Comparing Life Insurance Companies
by Penny M. Hagerman
Though sometimes a complicated product, the
advantages of life insurance are many. By providing funds that help families
become independent and self-sufficient, the right life insurance policy takes
care of things when providers no longer can.
4 Simple Steps to Finding the Right
When loved ones pass, spouses and family members
often have a difficult time thinking clearly—and dealing with life insurance
companies and financial matters can be a bit overwhelming.
But by taking these four simple steps to finding a
quality life insurance provider, it's easy to smooth that life transition—and
protect loved ones, when the time comes:
- Request quotes. When matched with companies, give
them a call or send them an email and ask questions about things that aren't
clear. If not sure how much or which what type of life coverage is needed, let
companies offer assistance with their expertise.
- Before doing business with companies, check with
the state department of insurance to make sure each is licensed in the state of
residence. (Since licensing is handled by states individually, not all companies
are licensed in every state.) With the backing of the state department of
insurance, families are covered if there's ever a problem—financial or
- Compare contracts and policies carefully. Read the
fine print, and ask life insurance agents about anything that's not clear.
Better to find out ahead of time than to leave loved ones confused and looking
for answers after the fact.
- Compare ratings from independent rating companies
online, such as A.M. Best, Moody's, Standard & Poors or Weiss. These
services rate life insurance companies based on how they perform
professionally—and provide valuable information that can help in selecting the
right life companies.
Choosing Between Insurers
With the above information at your disposal, next
consider and compare the following identifiers from one company to the next.
They'll help you choose the right insurer: one that can be relied on and trusted
during vulnerable times.
- Product. Most insurance companies offer a broad
range of policies and features, so choose the company that suits the situation
- Company Identity. Different companies often have
similar names. Some life insurers use words suggesting financial strength,
sophistication, maturity, dependability, government involvement or
well-respected Americans—which may be misleading. Become familiar with each
company's full name, home office location and affiliation for a true
representation of its identity.
- Financial Solidity. Use ratings from independent
rating agencies mentioned earlier to select financially sound companies that
will be around long term.
- Advice & Service. Because life insurance is a
complex product, find communicative, attentive companies that respect your
- Claims. Check with the state insurance department
to gauge the volume of consumer complaints vs. satisfactory claims service. This
will give you an idea what to expect come claim time.
- Premium & Cost. Compare similar life insurance
plans from different companies to get the best deal. Insurers base premiums on
age, policy type and features, as well as the amount of life insurance being
purchased—but price is sometimes flexible.
Security & Ease
Don't risk leaving loved ones unprotected. Take
steps to secure your family's future today. It'll give security to those you
love—and make life just a little bit easier.