Should You Purchase Life Insurance Online?Article Posted by Expert Author: Adam Foley on 09/03/2013
Most people today use the internet when looking for information. While it can be much quicker than calling companies, special care should be taking when using the internet to buy life insurance.
Do Your Homework
Before you even begin searching for life insurance coverage, it's important to do a little homework first. Find out what kind of policy you think you will need. This will mean choosing term coverage, whole life or universal life policies.
Next, figure out how much your family will need to cover their expenses should something happen to you. Then, you will need to figure out for how long you will need coverage for. Finally, your monthly budget will definitely come into play. How much will you need to spend per month on your life insurance premiums?
The Importance Of Your Source
Just like anything else you do on the internet, it's important to be sure that you are getting your information from reputable sources when you search for life insurance options online.
One of the ways to do this is to check their ratings with the Better Business Bureau. The BBB website has extensive listings for companies all around the world. You can read about customer complaints, and hear from the customers on what kind of job a life insurance company did in a time of great need.
Types Of Life Insurance Quote Sites
Be aware that there are three types of life insurance web sites: lead capture, corporate and broker sites.
Lead capture sites do not provide you with an online quote, but inform you that insurance companies will call you with a quote instead. In order to get a quote, you must provide them with consumer information which will then be sold to insurance companies.
Corporate sites allow you to compare only the products that they offer, and not quotes from different companies.
Broker sites offer coverage from several insurance companies, and allow you to compare multiple companies with one interface. So if you're searching for life insurance companies in Kansas and how to compare them, you'll want to keep this information in mind.
Can You Really Cut Out The Middle Man By Getting An Online Quote?
Many people who are looking for life insurance coverage expect that they will save more money on that coverage due to there not being an agent involved. But this couldn't be further from the truth.
If you want coverage for ten years, and that coverage will cost you $500 per year, this might result in an agent commission of 50%, meaning just over two dollars per month when the commission is averaged over a decade. This means you only save a couple of dollars per month, even if you eliminate the commission.
Underwriting, And The Agent's Role
Because going online for a life insurance quote means never meeting an underwriter in person, those underwriters only have your application information to rely on when deciding on the rate class you will receive. Your rate class will be super-preferred, preferred, select, standard or substandard.
By purchasing insurance coverage online, you may find that underwriters are less aggressive with their decision. This can be especially true if it’s determined that you fall between one class and another. Having an actual agent can mean better communication with the underwriter, which could very well result in a better rate for your life insurance policy.
You'll want to deal with only those life insurance companies that have a long track record of serving consumers through fair practices, and you'll also want to make sure you are comfortable with the policy benefits and price points you are being offered.
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