iQuanti: Thinking about and purchasing life insurance can be an emotional and difficult time, because it's hard to think about what will happen once you're gone. However, a life insurance policy is a great way to help your beneficiaries pay for funeral expenses, medical bills, outstanding debts, and other financial obligations they may have after you pass.
Once you've decided it's time to purchase a policy and have done some research on the type of policy you want, you must choose a life insurance company to buy the policy from. With hundreds of life insurance companies to choose from, representing billions of dollars in policy benefits, it can be challenging to know where to even start.
Here are five tips for picking the right life insurance company for you.
Know what's available in your state
Not every company is licensed to operate in every state, and you should choose a company who is licensed in the state you live in. That way, if something were to happen with the company, you could rely on your state's insurance department to help and fund your policy.
To know where a company is licensed, you can check with the company itself or contact your state insurance department.
Consider the type of policy you want to purchase
Most life insurance companies offer different types of policies and features, but not all offer everything available. Because not all companies offer all options, you should have a general idea of the type of policy you want to purchase and know any particular features that are important to you and choose a company that offers what you need.
The type of policy you choose will depend on how much death benefit you need, for how long, whether you want a policy that accumulates cash value, and other factors.
Compare company finances and reviews
Choosing a company that's able to withstand economic ups and downs is important, especially since you could have a policy with a company for many years.
First, look at the company's financial strength ratings, which are judged by a variety of factors including their ability to pay death benefit claims. These ratings are issued by companies like Standard & Poor's, A.M. Best, and Moody's. Most companies have these ratings posted on their website, and in general you should look for ratings in the 'A' range.
You should also do some research on general consumer ratings and feelings about the company, which you can find on social media, Google ratings, and insurance company comparison websites. Learn about how existing policyholders feel with the quote and purchasing process, fulfillment of claims, customer service, and other factors that are important to you.
Know how your health affects your coverage
Your medical history, age, and other factors such as if you're a smoker, can all have an impact on the cost of the policy and which type of policy and/or insurance company are right for you. You may find some companies are more flexible with selling policies to people with poor health, preexisting health conditions, or are above a certain age, while other companies are not.
Additionally, some medical underwriting may be required depending on the amount of the death benefit applied for. This means you have to answer questions or even be evaluated by a medical professional prior to purchasing a policy.
Work with an agent
While most insurance companies allow you to read about their policies, features, and even get a quote online, navigating the number of companies and options can be difficult and confusing. Insurance agents can help you decide which policy is right for you, what terms and benefits are important, and which company meets those needs. They can also help you through the application process, and answer questions you have along the way.
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Original Source: How to Choose a Life Insurance Company
