Tag Archives: Life Insurance

Mar 14 2026

Shopping for life insurance

esent and future sources of income, other savings and income protection, group life insurance, pension benefits, Social Security, and, of course, the financial strength of the company.  Here are some tips in purchasing life insurance.

  • Make sure the agent and company are licensed to sell insurance. If you buy from an unlicensed company, your beneficiary might not get paid if the company fails. Licensed companies belong to a guaranty association that pays claims for failed companies.
  • Check a company’s financial rating and complaint history. To learn about a company’s financial rating and the number of complaints against it, call your state’s Consumer Help Line.
  • Shop for a low- or no-load policy. You might save money if you buy a policy with low commissions and fees, which are known as the load. Financial planners who are licensed insurance counselors often sell these policies. They usually charge clients a flat fee.
  • Get quotes from several companies. Rates vary by company.
  • Compare “apples to apples.” Be sure the policies you compare offer similar coverage. A less expensive policy could have fewer features or a lower death benefit. A more expensive policy might be a better value when you consider the amount of the death benefit per premium dollar. Don’t choose a policy on price alone.
  • Know how much coverage you’re buying. Talk to your agent about the coverages and amounts you need. Think about how much you’ll need to help your dependents after your death.
  • Know how much your policy will cost. Your company should tell you exactly how much your policy will cost. If you’re not OK with the cost, ask the company if they have a different policy.
  • Use your free-look period. Most policies have a free-look period of at least 10 to 20 days. During this time, you may cancel the policy for any reason and get a full refund. Use this time to be sure the coverage is right for you.
  • Review the information an agent gives you. Agents often use charts to show how a policy’s cash value might grow. These are usually projections and aren’t a promise of a policy’s performance. You could earn less than the projection. Ask for a history of the actual growth of cash values.
  • Watch out for illegal acts. Agents can’t offer you a gift or a discount on an investment or loan to encourage you to buy life insurance. If you think an agent has made an improper offer, call your states’ Consumer Help Line.

For more information, click here.

Teaching Suggestions:

  • Ask students why it is important to understand and know what your life insurance needs are before you make any purchase?  Also, why is it important to review the company to ensure they can meet your needs?
  • Ask students if they check their coverage periodically, or whenever their life situation changes, to ensure that it meets their current needs.

Discussion Questions:

  1.  Why is it important to know the ratings of the insurance company?

  2.  What should you do in examining a policy before and after the purchase?

Feb 3 2024

Do you need life insurance?

Think about your age, your financial situation, and if you have loved ones who depend on your income. If you do decide to shop for life insurance, here are some things to consider.

  1. How much life insurance do you need?

Life insurance helps your loved ones with financial needs when you die. Consider your mortgage and other debts, how much income would need to be replaced, money to cover a funeral, and college for the kids. Add those up, and you’ll have a good idea of how much insurance you’ll need.

2. Term or permanent?

There are two main categories of life insurance:

Term life insurance is the simplest and least expensive option. It covers you for a set period of time. You might consider term life insurance when you have a family that depends on your financial support or while you have a mortgage. For example, you may want a term life policy that lasts until your children are out of school.

Permanent life insurance provides coverage for your entire life as long as you keep up the payments. Because of the length of coverage, it costs more than term life insurance. These policies may have features that offer a cash value that can be used to invest or pay some of the premiums later in life. Permanent life policies are complicated so it’s best to talk to a financial planner when deciding if one is right for you. If you do buy a permanent life policy, make sure to check with your agent each year to see how the policy is doing and if you need to adjust your payments.

3. How much will it cost?

Insurance companies consider things like your age, health, job, and tobacco and alcohol use when setting prices. It will cost more to purchase life insurance as you get older and if you have health problems. Some companies may require a medical exam before selling you life insurance.

4. Who will benefit?

You can leave money to a spouse, children, other family member, or friend. This is known as the policy’s beneficiary. You can also name an institution as your beneficiary, such as a business or charity. And you can choose more than one beneficiary and specify how the money will be divided.

For more information, click here.

Teaching Suggestions:

  • Have students create situations which point out the different reasons for buying Life Insurance.
  • Have students survey several other people to determine their reasons for buying Life Insurance.

Discussion Questions:

  1. What is the relationship between age and the amount a person pays for life insurance?
  2. What personal, social, and financial factors should influence the amount of life insurance a person might desire?
  3. Why might many insurance agents dissuade you from buying low-cost-term insurance?