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Life insurance from the big guys?

Is bigger always better when it comes to buying term life insurance online? Is it better to get a term life insurance policy directly from the big life insurance company or is it better to get a policy from one of the big term life insurance sales companies? The answer is no and no. However, there is a logical explanation. There are three ways to buy term life insurance.

  1. Buy direct from a big life insurance company.

  2. Buy from mega term life quoting companies.

  3. Buy from an independent agent.

Buy Direct

Buying term life insurance directly from a big life insurance company may be attractive. However, there are drawbacks. In most instances, there are limited types of term life insurance available. Many insurers tend to offer life insurance policies directed at a certain segment of the population. People that have health issues may be at the greatest disadvantage of relying on only one life insurance company. If the insurer chosen declines or postpones offering life insurance coverage, that denial will make it more difficult to go to other life insurance companies for a life insurance policy. Life insurance companies share general life insurance underwriting information through an organization called the Medical Information Bureau. At the outset of applying to another life insurance company, they will know that another life insurance company declined to offer coverage. Almost all life insurance applications will ask if you have been rated or declined. Regardless of how you answer, a cross-check will be made through the Medical Information Bureau, and an applicant will be left explaining the circumstances.

Buy From Big Term Quoting Companies

The second way to buy term life insurance is through one of the large term life insurance sales companies. These companies do offer many term life insurance quotes. A common statement made is that customers can get quotes from top life insurance companies immediately. That statement is so overused. Mega term life insurance quoting companies have drawbacks because of the nature of their way they do business. These companies thrive on volume, so if you are not in top notch health, the quote you receive probably will not be very accurate. The other drawback that tends to bother most people is that your data is passed on to other agents or possibly sold to outside life insurance agents. Since this type of life insurance sales company emphasizes a sales quota on agents, there is a turnover of agents. The result is if you did not buy a policy when the first agent contacted you, your number would be passed on and on to other agents.

Independent Life Insurance Agent

The third way to buy term life insurance is through an independent life insurance agent. Independent agents offer a simpler way to buy life insurance. Depending upon your health condition, independent life insurance agents will offer a proposal for life insurance coverage that includes quotes from many companies. Top rated companies are important, however depending upon the health condition of the person applying for life insurance, a moderately lower rated life insurance company may be appropriate. If a person applying for life insurance has some type of issue with their health, moderately lower rated companies may offer better rates or even guaranteed coverage for certain customers. Independent life insurance agents are usually more experienced and able to help a customer determine if a lower rated insurer may be in their best interest. This is not to say lower rated companies are the best option. Higher rated companies are always a better option if they are competitively priced. Understanding the financial stability of a life insurance company, how they are monitored, and regulated by each state is important when choosing a life insurance policy that will possibly be in place for decades. An independent agent is best suited to help clients in this situation.

Another significant advantage an independent life insurance agent can offer is that you will generally deal with one experienced agent. And your information will not be sold. Here are how the advantages of dealing with an independent agent can be summarized. Customers get low priced realistic quotes from an experienced life insurance agent who is dedicated to helping their customers find the right life insurance.

For more answers to insurance questions, visit our Q & A page.

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