When was the last time a life insurance agent knocked on your door? It’s probably been more than 10 years, if ever. The days of an agent calling on you in your home are for the most part over. This has led to a decrease in overall awareness of the need for life insurance, which means fewer consumers than ever are buying a policy. According to Gary Lardy, CEO of IntelliQuote (www.intelliquote.com), an online life insurance agency, it is up to the consumer to be proactive and conduct their own research when buying life insurance.
In a recent study conducted by LIMRA, a financial services industry think tank, researchers found that approximately 30 percent of U.S. households (35 million) have no coverage, up dramatically from 22 percent in 2004. The news comes as the industry marks its seventh anniversary of Life Insurance Awareness Month (LIAM), a full-fledged effort through the month of September to raise awareness about the importance of life insurance.
According to the LIMRA study, only 44 percent of U.S. households have an individual policy. This is, in part, attributed to difficult financial times and lack of available resources; approximately one in four middle-market households admit they don’t know how to reach their financial goals, including buying life insurance.
Online resources make it easier and faster.
Despite fewer consumers purchasing life insurance, the process has never been easier. Over the past 20 years, there has been an emergence of online insurance agencies and brokers, giving consumers the opportunity to educate themselves and purchase life insurance online without the pressure of an in-home visit.
Lardy notes that conducting your search on the internet saves time and money, but you need to know where to start.
“Shopping online offers a greater choice of competing products and 24-hour access to tools to help you determine the right policy for you or a loved one,” said Lardy. “Finding the right resources online is key to ensuring you’re buying the coverage you need, with a company you can count on to be there when your family needs them most.”
Most consumers are familiar with comparison shopping. Buying life insurance is no different when shopping online.
Things to consider when buying Life Insurance Online:
TYPE OF PLAN
There are three primary types of life insurance plans: term life, whole life, and variable life. Term life is usually the simplest and least expensive option that provides coverage for a specified period of time. With whole life your premiums are fixed, though typically much higher than for term life, and the policy remains in force throughout your entire life. Variable life allows you to allocate a portion of your premium dollars to a separate account comprised of various investment funds within the insurance company's portfolio. This type of policy is considered an investment risk as the cash value is dependent on the performance of the investment portion of the policy.
Online tools such as IntelliQuote’s life insurance calculator can help you calculate recommended coverage for your age, income, monthly expenses, and other factors, such as future expenses, earning potential and inflation.
The younger you are, the longer the time you need to estimate your family will need to be protected in the event of your death. And as you add dependent children or parents, student loans, mortgage payments and debt, or get closer to retirement, your need for coverage will change.
Your policy’s premiums may be less than you think, particularly with so many choices online. Premiums may differ by state and insurance carrier, as well as by policy attributes.
Most companies will arrange for you to have a medical exam as part of the application. Not all plans require a medical exam. However, those that don’t require a medical exam typically come with higher premiums.
Compare ratings of the insurance companies offering the plans you like. A. M. Best Company independently compares companies and assigns ratings based on a company’s financial strength.
Some websites offer links to hundreds of plans and companies; others may be published by independent agencies quoting from a pool of companies they are contracted with to do business. And, many online companies offer licensed insurance agent support, including IntelliQuote.
WHAT TO EXPECT
Now more than ever, the process of buying online is easy and straightforward. At your own pace and convenience you can compare quotes and insurance companies, review available plans and features, and request an application online. And in most cases, online insurance agencies connect you directly with a licensed insurance agent at no cost to ensure you’re purchasing the policy to provide the right coverage for your family.
“The biggest step to take is to decide to buy life insurance. Don’t wait for someone to knock on your door or call you on the phone,” said Lardy. “There are many options to make it easy to buy for your specific situation.”