Atlanta Quote Blog: Life
10 Tips for Life Insurance in Atlanta
Ahhh, the joys of buying Life Insurance in Atlanta, Georgia, or anywhere for that matter! Or, the joys of re-visiting Life Insurance after having purchased and owned for quite some time. I have put together 5 Tips (arbitrary # that I now must come up with tips on) to help you in your Life Insurance Pursuit.
Tip #1) Price does matter! Do not be fooled. The first quote and the second quote are not enough when buying life insurance. There are a multitude of companies which exist today having both a GREAT credit rating and fantastic risk management systems to manage their exposure. Therefore, you can find two awesome insurance rates, but the next one could be 10% cheaper. I was working with a client needing $5mm of Term Insurance. The price range was 30% from top to bottom. He had a relationship with an insurance agent from years ago. I told him, "no sweat, get rates from him. This is about what is best for you as a client." Well, the other agent came in at 10% higher than what we had shown him. Once the other agent found out about the other "quotes," he proceeded to come up with more competitive rates. This, by NO means, is meant to say insurance agents or those offering rates are trying to stick one to you! This only means, sometimes you have to search a little more for the best as in any business. Leading to Tip #2
Tip #2) If you do use an Agent, tell them "I am looking for the best insurance rate I can find for what I need. I am going to check with some other people as well." This will make him/her "search" for the best rate. Now, there is one other caveat to this leading to Tip #3.
Tip #3) You should use a local agent! Why? Because there are so many factors which can affect the outcome of your insurance. a) What type; permanent or term. If permanent, there is Whole, Variable, and Universal Life. If term, there is 5-year, 10, 20, 30. There is even Return of Premium Term insurance which charges 10% to 20% more but gives it back at the end of the term with a rate of return. Not a bad investment vehicle in these times. Although a good asset allocation plan works a wee better. But, your getting insurance with this one! Also, back to Local. Your really, really need to sit down with someone. There is nothing like someone understanding your needs and concerns. This, of course as you have figured out, leads to #4
Tip #4) You Needs. There are many ways to figure out how much insurance someone should have for themselves and their families. Common thoughts are 10x earnings to 15x earnings. However, does a household with $60,000 of combined income need $600,000? If they are in their late 20's or early 30's with a young child. Could be. If they are older and the kids are out of the house, hummm, a little bit more analysis is need to figure out their Life Insurance needs. Hence, going back to Tip #3. This is not something which can arbitrarily be decided by an online column, newspaper article in the Atlanta J&C, or some other Atlanta publication. Before putting your hard earned assets into something which, for the most part, you will never see, have someone look at your situation.
Tip #5) Bells and Whistles!! Sorry, no lead in from Tip #4. Didn't have a good segue...As our population ages, more and more people seem to want, need, or have to have life insurance. Not certain of that sentence...however, because of these changes, competition amongst insurance companies has become very heightened. For example, in Tip # 3 I mentioned Return of Premium Life Insurance. Well, this is a bell and whistle. Something special to juice up a companies product offering. You also have a new change as of late; guaranteed convertibility of your term life policy into a permanent policy. Let me explain that one. If you buy (rent) a 20 year term policy, you can (depending on the insurance company) convert this policy into a nice, new permanent universal, whole, or variable life policy (the type depends on the insurance company). However, there are some major differences between insurance companies. Some, in the 20-year example, will only let you convert for the first 10-years or until 70 years old. Others will let you convert until the policy ends in the 20th year. I wonder, which is the better deal? If the premium is the same you would probably say the company with the 20-year conversion. What if I was to tell you, as of today, at your age in 10 years the permanent policy costs for the "better" company is 15% higher than the "bad" company.
Company A 20-Year term: can convert in 10-years only [To buy a permanent policy in 10 years would be, lets say $4,500]
Company B 20-Year term: can convert in 20-years [To buy a permanent policy in 10 years would be, lets say $5,000] (for educational purposes only. Not real $$'s)
I know we are converting in 10 years opposed to 20 years, but the example is to illustrate that "a lot" goes into choosing the right policy, amount, type, etc.
Hope these tips helped. Each of these tips could be expanded on in an article by themselves. However, I will not subject you to my poor attempt at grammatical structure. If you need some more details, feel free to blog back. KN
Posted on July 8, 2008
