What is the best way to get a >500k term life insurance policy on myself

December 16, 2013 9:55 AM

’d like to buy a 1 million dollar life insurance policy for myself to protect my family and dependents should I die unexpectedly. I already know to get a term plan and avoid the other trappings that insurances may offer. Now the question is how do I do this? More inside

I’m a 30 year old man looking to get a 1 million dollar insurance policy. I have looked at the following brokers such as those on AccuQuote.com and SelectQuote. At work, I was offered a policy sponsored by the National Teacher’s Association Life Insurance company, a small insurance group with an A- rating. I took them up on their offer of 250k insurance for 26 dollars per month. However that still leaves me with a 750k shortfall.

My question is this: Where do I go to get a no hassle 1 million dollar life insurance policy. I want to pay as little in broker’s fees and am willing to undergo whatever underwriting medical procedures they want to use. I am in good shape, non-smoker and am risk-averse, hence the policy. There is a family history of diabetes and heart disease. I am not on that course yet as I try to take care of myself by running and exercising and not eating too much saturated fat.

So the hive mind, what do I do? Whom do I turn to? The AccuQuote people want me to sign up with Banner Life Insurance Company based out of Rockland, MD. Is this a good idea? Should I just set up an appointment at Geico or MetLife or Mutual of Omaha. Will going through directly to them get me a better deal. Explain it to me like i’m a (weird) 10 year old. Any recommendations and past experiences welcome. Please help!

posted by RapcityinBlue to Work & Money (11 answers total)

Hassle free and life insurance do not, for better or worse, really go together.

That said, life insurance policies are complex contracts between you and the insurer. I'd recommend that you review any contract you're asked to sign in detail and ensure that you fully understand all the terms and conditions to which you would be subjecting yourself. If necessary retain the services of a competent attorney who can help you navigate any questions.
posted by dfriedman at 10:03 AM on December 16, 2013

We went with this fellow, Ian Sumner (quoted in this Motley Fool article), who had been frequently recommended to us on a neighborhood listserve. He charged us no commission, very patiently explained everything to us a few times, and when we compared the rates he got us, they were the best we could find anywhere. I highly recommend him and will memail you his contact info.
posted by semacd at 10:04 AM on December 16, 2013

I've got a $1 million policy from State Farm. There is a physical (of course), but I don't remember any weird fees or problems. Try going to whomever does your homeowner/renter/car/etc. policies. It sounds dumb (since that's what all of the TV ads are trying to get you to do), but I think they do try to give you a good deal when you get a bunch of things from the same place.
posted by originalname37 at 10:10 AM on December 16, 2013 [2 favorites]

I'd also recommend talking to an independent financial broker in your neighborhood.

They shouldn't charge you any fee at all.

1 million shouldn't be a problem if you're willing to go through the medical underwriting.

There are a lot of insurance products around and having your own broker is the best way to avoid getting someone's crappy off-the-shelf bank product.
posted by ServSci at 10:13 AM on December 16, 2013

I went to my regular insurance agent who handles my homeowners and auto/boat policies. He is an actual person with an actual office (with state farm), and it was fairly straightforward, but I did need to get a minor medical exam, but they sent a nurse practitioner to my house to do this. This was for a $1 million, 20-year term life policy.
posted by tylerkaraszewski at 10:16 AM on December 16, 2013 [1 favorite]

We have recently been looking at getting more life insurance and talked with a financial advisor about how to find a policy. The advisor's suggestion was that finding a reputable, stable company is more important than getting the best deal, because you want to be relatively confident that the insurance company will still be around in 20 years. We haven't chosen a company yet, but Amica and USAA were both mentioned by our advisor as good choices.
posted by medusa at 10:39 AM on December 16, 2013

The one problem with shopping for life insurance is that if your benefits under the policy ever become payable, you won't be around. I don't think people whose loved ones have died will be quite that forthcoming about reviewing life insurance providers, so you may have trouble doing your research.
posted by tckma at 11:08 AM on December 16, 2013

Assuming you are located in the United States, I respectfully disagree with the suggestion that a life insurance contract needs to be reviewed by an attorney. This is because language in these contracts is monitored and approved by the state insurance departments. For the same reason, it is not necessary to take your auto or home policy to an attorney for review. Otherwise, it truly would be a nightmare for consumers.

There are different characteristics from one term policy to another. The biggest thing is to ask for how many years the rate they offer is guaranteed. Most term insurance policies terminate at a specific age often 70 or 80, or they terminate after ten, twenty or thirty years after which you may be without coverage, or the rates may skyrocket.

I do agree with the suggestions to work with a reputable company that is admitted to do business in your state. I like State Farm, I like Nationwide, but of course there are many good ones out there. You can get financial ratings at ambest.com, and I suggest only working with companies that are rated A+
posted by elf27 at 11:43 AM on December 16, 2013

Get multiple $250k policies from different companies that total up to 1 million.
posted by stormpooper at 12:04 PM on December 16, 2013 [1 favorite]

I used AccuQuote, but they gave me a variety of prices for different companies. I paid a little bit more for a company with a better rating. The process was simple; they sent me paperwork, I filled it out, they arranged for an inhome medical appointment, and that was that.

I think four $250,000 policies would be much more expensive than a single $1,000,000 because of the administrative overhead.
posted by Mr.Know-it-some at 12:35 PM on December 16, 2013

If you use an independent insurance agent, he or she will be able to give you a price comparison among companies and policies. I highly second the idea of limiting your choice to an A+ rated company. The cost is likely to be a little more, but there is more security.

Then again, several highly-rated companies disappeared a few years ago. There is always some level of risk in that business.
posted by yclipse at 1:45 PM on December 16, 2013