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Buying life insurance is probably not a task that most people look forward to doing. While it’s not enjoyable, it no longer has to be inconvenient to buy life insurance to protect your family’s financial future since many companies have online quoting tools and applications.
Start comparing life insurance rates now by using our FREE tool above! If you’re tight on time but you realize that you need to commit to financial planning, applying for life coverage online could be the answer. Read on and find out how to find the best term products online and then how to apply for these policies.
Decide Which Type of Term Insurance is Best for You?
Term insurance is the most popular type of life policy sold today. While it’s the most popular category of insurance, there’s multiple types of products that fall into this umbrella.
A term insurance policy, simply put, is a policy that provides the named insured with death benefits for a stated period of time.
You’ll need to know which policy you want before you choose the wrong policy by default. Here are the offerings available:
- Annual Renewable Terms
Annual renewable terms (ARTs) were once very popular but have declined in popularity in the recent years. These products offer the named insured a guarantee that they can renew their coverage for a set number of years but the premiums will rise as the person ages. It’s best to buy ARTs when you only need coverage short-term.
- Level Terms
Level terms are much more popular because they are affordable and the premiums stay level for a much longer period of time. Level terms can be purchased for terms of 5, 10, 15, 20, 25 or 30 years depending on the company. Longer terms come with higher premiums but secure fixed premiums until a higher age.
- Return of Premium Term
A Return of Premium term policy is a special form of insurance that’s been written to eliminate some of the risk involved with buying a policy you won’t use. In essence, you’ll receive cash back at the end of the policy if you’re still living. Unfortunately, these policies carry much higher premiums and they aren’t available through many carriers.
How Much Coverage is Enough Coverage?
Now that you’ve decided on an annual, a level or a return of premium term, the next step will be to decide on a death benefit. Choosing a death benefit isn’t as easy and straightforward as you might think. Not everyone’s reasoning for buying insurance is the same and this is something you’ll need to remember. Here’s some valuable tips that you should keep in mind as you’re deciding how much life insurance to apply for:
- If someone is dependent on your income, you must decide how long you want to offer your family with income replacement?
- What is the balance of your mortgage?
- What’s the balance of your credit card, auto loan, and student loan debt?
- Do you have dependents? What’s the estimated cost for childcare and future college expenses?
- How much does your family spend each month for monthly needs?
- What’s the estimated amount your heir would pay in estate taxes based on your current net worth?
- How much will you need to put away for final expenses?
- How much coverage do you have? Is any of the coverage group life that you can lose if you leave your job?
- Do you have a savings to cover any expenses?
What can you use online to calculate your life insurance needs?
There are plenty of tools online that you can use that will help you factor in all of the totals so that you don’t forget any of the key areas. Online life insurance calculators are free to use and easy to navigate through. Just be sure that you enter the dollar amounts in the fields properly and don’t leave any of them blank so that you get an accurate assessment of your needs.
Gathering All of Your Information for a Quote
Now that you have a policy type, a term and a death benefit, you can get to the quoting process. Life insurance companies ask for your personal information, information on your habits and physical characteristics as well to underwrite risk. Here’s some of the information that you’re asked for when you’re quoting and applying for coverage:
- Age and gender
- Tobacco user?
- Occupation and employer
- Height and weight
- Annual income and net worth
- Hobbies and lifestyle habits (skydiving, scuba diving, piloting, etc)
- Medical conditions and recent surgeries
- Prescriptions you currently take
- Family medical history
- Driving record and serious violations
Be Sure to Research Life Insurance Carriers
Price is important, but it’s not everything when you’re buying something as important as insurance. You’ll need to find reputable companies that you can trust to pay out claims and care for your beneficiaries after you’re gone. Here’s some factors that you can review to find out if a company is right for you:
- Financial stability is crucial. You can check to see if an insurer has the money to cover claims by checking their financial ratings
- Customer service ratings can help see what the reputation of the insurer is after the policy is purchased
- Find out methods of contact to see if they’re convenient
- Claims satisfaction ratings can help you discover how quickly claims are settled
Submitting Your Online Application
After you’ve solicited quotes online, you can submit your application by electronically signing documents and disclosures and agreeing to go through the underwriting process. This process may involve having your medical records reviewed and also submitting to a paramedical exam to check your vitals and weight.
Once the application is approved, you’ll pay your premiums and the policy will take effect.
If you’re ready to buy a term life product online, now’s the time to start pricing plans. Decide on a term, a death benefit and the riders you want. Use an online rate comparison tool and you can not just compare the premiums with several different trustworthy providers, you can also start the application process via the web. Start comparing life insurance rates now by entering your ZIP code in our FREE tool below!