Those sneaky insurance agents!
"I spoke to an agent who quoted me a price for life insurance. I filled out the forms, I let a stranger come to my house to take my most prized possessions - my blood and urine- I waited and waited, and now...they want more money from me!"
This is a common conversation I have with people who are shopping for life insurance. They tell me that when they applied for coverage they were quoted one price and now the insurance company wants more money after doing a medical exam. In this blog post I’ll explore why this happens, tell you if its your fault, the agent’s fault or neither's fault, and what to do in these cases so that you can get the best rate on life insurance.
Life insurance companies use health ratings to price your policy. The healthier you are, the less at risk you are of dying (young that is) and in turn you get a better price. You were quoted one health rating, and after the exam a lower rating was given by the underwriter (the person who is responsible with reviewing the exam results and doctor’s records). So why weren't you given an accurate quote to begin with? Whose fault is it, because I’d like to fire him! Woa - Not so fast - let’s explore who may be the responsible party here.
If you are working with a competent insurance agent they should be able to quote you appropriately. When I give someone a quote for insurance, I usually give them a range of where I think pricing might come in after an exam, and typically I come pretty close to the right number. Your agent should be doing the same thing. If they are very confident you would get a certain price, I would see that as a lack of experience, because you never know what can be found on an exam. So if your agent knows what they are doing, why didn't they quote you properly?
It could be your fault. When it comes to life insurance the rule is disclose,disclose,disclose. Don’t leave anything out. It’s your agent’s responsibility to probe, but you should take ownership of disclosing as much as you can about your health, or any other fact that might impact your pricing (like if you ever filed bankruptcy, got a DUI, or spent last Christmas in the slammer). For example if your agent asked you if you smoked and you said no, you should disclose if you just quit 2 months ago, 2 years ago, or 5 years ago - all these factors can impact your rate.
You should disclose things like family history of heart disease, stroke, or cancer and if you have parents that died under the age of 70. If you smoke an occasional cigar - or smoke anything else for that matter - disclose it. While the onus is on the agent to ask, the more you disclose the more accurate a quote you should get.
If your agent is newly licensed and doesn't have much experience it may be the agent’s fault. Maybe they just wanted to get you to apply for a policy so they quoted you the best price, without taking your current health or situation into account, or maybe they simply don’t have the experience to quote properly based on asking you the right questions.
Sometimes you disclose everything you should and the agent asks all the right questions, but something comes up on the exam you’re not aware of. I've had the unfortunate experience of telling people who thought they were perfectly healthy that they have diabetes, high cholesterol, and even an enlarged prostate. These are things that come up that can affect your pricing that nobody could predict ahead of time.
When you find out that your rate is higher than originally quoted ask your agent for the reason why the rate is higher. In addition request a copy of the lab results from the medical exam that you had done. This information will enable you to know what to do next. For example if your rate is higher because your cholesterol is high, you will want to know exactly what the numbers were (which you should find out anyway for health reasons).
Your lab report should include total cholesterol,HDL,and LDL. Knowing these numbers and sharing them with an independent agent (like me) allows an agent to review the cholesterol guidelines of multiple carriers and see if you can get a better health rating, and in turn, better price with another carrier. It’s possible that the increase in rate will be across the board with all carriers, or that you can find an insurance company that will offer a better deal.
If you intend to stay with the same carrier you still have options to lower your cost. For example if you applied for a 30 year $500,000 policy, you can request the pricing on a 25 or 20 year policy and see if that more closely matches your intended budget. You can also lower the coverage amount and find a happy medium between price and coverage.
Captive agents represent just one company - for example Allstate, or State Farm agents are considered captive. When you don’t get the intended results, the agent will only be able to try and convince you to stay with them, because they don’t have alternatives.
When you shop with an independent agent and don’t get the intended result with one company, your independent agent can simply go to another company that might offer you a better health rating. Going back to the cholesterol case, today I had a client that was approved at Standard Non Tobacco with Protective Life, based on total cholesterol of 298. Protective Life requires a 220 total cholesterol or less to qualify for their best pricing. ING on the other hand allows up to a total cholesterol of 300 for their best pricing as long as the HDL is less than 75 for men or 90 for women. In this case the client’s HDL (a female) was 91. My plan is to speak directly with ING and see if this client can get preferred plus or preferred pricing and get a better rate than with Protective.
The above example is the benefit of using an independent agent that is unbiased, versus an agent that works for just one insurance company.
If you've been quoted one rate and now have a higher offer, I can help you review your lab results as well as discuss your specific situation.
In this blog post I’ll explore how to get life insurance with the premium locked in to age 100, why it would or would not make sense for you to consider a policy to age 100, as well as discuss pricing for policies with level premiums to age 100 as compared to alternative term periods. You can compare rates for yourself right below using our quote tool, or keep reading for more on term to 100 life insurance.
When you buy a term life insurance policy your options are usually between a 10 year, 15 year, 20, 25 or 30 year policy. Most people will find that one of these options will help them get the coverage that they need during the years they need it most. For example many people under 50 will choose a 20 or 30 year policy, while those over 50 may find that a 10 or 15 year policy meets their needs.
However there are times when people want to make sure that they have a policy that lasts for a longer period of time. Maybe it’s to leave money to cover final burial expenses, or just leave an inheritance to children or other family members. Others have longevity in their family history and want to have a policy that covers them well into their 90s or longer.
In instances of someone looking for a policy that guarantees premiums remain the same until age 100 there is an option, however it isn’t a term policy.
A Universal Life Policy with a No Lapse Rider is a life insurance policy that can have premiums that are guaranteed never to go up. Policies exist with options to lock in the rate to age 90,95,100 or even 121. This type of permanent life insurance is essentially the same as term insurance, except that the premiums are locked in for a longer period of time.
While a universal life with no lapse rider can build up some cash value, it really isn't designed to build up significant cash value the same way a whole life policy is designed. The result is a cheaper policy than whole life, while providing coverage on a permanent lifetime basis.
When compared to a term life policy a Guaranteed Universal Life policy is more expensive. However it is a form of permanent life time coverage with premiums that are guaranteed never to rise. In addition these policies are much cheaper than whole life policies.
There are several companies that offer competitive rates for these types of policies:
North American Company for Life & Health
Mutual of Omaha
How does pricing differ between a term policy and a guaranteed universal life policy?
Let’s take an example of a 50 year old male at Preferred Plus Non Tobacco for a $250,000 policy. We’ll compare rates between 20 year term, 30 year term, and a Guaranteed Universal Life to age 100 policy:
You can see that a guaranteed life time policy in this case is about 3 times the price of a 20 year term, and about twice the amount of a 30 year term.
In this article I’m going to write about 10 year term life insurance rates – including which companies have the best rates for 10 year term life insurance, examples of quotes for 10 year term,medical vs non medical exam 10 year term life insurance.
There are several reasons to consider a 10 year term policy:
If you are looking to get the most coverage at the cheapest price, a 10 year term policy is the way to go. 10 year term will not make sense for everybody, for some 15,20,or 30 year term may make more sense, however 10 year term will be your best priced option for life insurance – so if you need life insurance and have a limited budget, 10 year term life is the way to go.
If you need life insurance to secure a personal or business loan, a 10 year term life insurance policy would be the best choice. Typically your loan will be for 10 years or less and this coverage will satisfy the lender, bank or the SBA (small business administration).
A 10 year term policy would also be suitable to secure coverage when you need it most. If you have kids over age 10, a 10 year term policy would make sure that your kids are protected until they are able to be on their own and not rely on you for income.
Perhaps you are in your 50s or 60s and within 10 years of retirement – a 10 year term policy would make sure that your spouse/partner would have a replacement of your income should the worst happen.
So you have an idea of pricing for 10 year term life insurance, I’ll provide some examples of pricing for a 40 year old, 50 year old and 60 year old male for $250,000 and $500,000 of coverage. Note that pricing for females of the same age would typically be less since women have longer life expectancy than men. I’ll provide pricing at Preferred Best Non Tobacco rates for those in excellent health, standard non tobacco for those in average health (for example overweight individuals) and standard tobacco rates. The rates below are monthly rates.
$12.09 at Preferred Plus Rates
$21.57 at Standard Rates
$61.69 Smoker Rates
$18.99 at Preferred Plus Rates
$37.85 at Standard Rates
$117.50 Smoker Rates
$24.59 at Preferred Plus Rates
$48.94 at Standard Rates
$143.28 Smoker Rates
$43.50 at Preferred Plus Rates
$92.66 at Standard Rates
$280.88 at Smoker Rates
$62.09 at Preferred Plus Rates
$116.80 at Standard Rates
$301.88 at Smoker Rates
$117.68 at Preferred Plus Rates
$215.52 at Standard Rates
$589.60 at Smoker Rates
While we work with over 30 life insurance carriers, here are the top 10 life insurance companies for 10 year term life with the most competitive quotes:
If you need to get your life insurance quickly, or if you simply want to avoid having a medical done, consider getting a No Medical Exam Life Insurance policy. You can typically get up to $250,000 of coverage without a medical exam. If you are in excellent health, you will get better rates with a medical exam, and we can help you compare rates for between companies that require a medical vs life insurance companies that don’t require a medical exam. If you are considering another term period we can also help you compare rates, for example 10 year term vs 20 year term.