Tuesday, January 15, 2008

Term Life Insurance Quotes: Can You Rely on Them?

One of the reasons you consider term life insurance is because you’re smart about prices. Term quote sites can show you lots of them. But are the prices they show anything like the price you’ll ultimately pay?

By Mary Pollman – SelectQuote

It’s easy to get term life insurance quotes online. If you Google “term life insurance quote,” you will get 311,000 search results. But can you believe the quotes you see on all those sites?

I went to five term life insurance quote sites, and the number of quotes I received varied widely from site to site. One offered 9 quotes. One offered 57. The price ranges were about the same. At my tender age, for $500,000 of 20-year term, the range was $97 a month to $123 a month. I had modestly entered “super-preferred” or “preferred plus” on all the sites when they asked about my general health/risk category.

The numbers are interesting, but frankly they’re mostly a come-on. To actually get any of these policies, I would have to fill out a full application and have a paramedical examination. An underwriter who worked for the insurance company would look at all the information and probably also check my records with the MIB (Medical Information Bureau, an organization that collects data for the insurance industry) and the Bureau of Motor Vehicles. Then the underwriter would decide whether the company would offer me a policy and, if so, at what price.

If the underwriter doesn’t think I’m eligible for that “super-preferred” rate, my online quote will have meant nothing.

I’m a big do-it-yourselfer, and I don’t like giving personal information online unless I really trust a site. So, shopping for term life insurance, I would probably make a quick visit to one of those anonymous quote-factory sites to get a broad notion of prices. But I would go back to their input screen two or three times, first indicating I’m “super-preferred” to see what those quotes look like. Then I’d go back and enter “preferred” and run the quotes again. Then I’d enter “standard” and check those quotes. That way I’d cover the waterfront and protect myself from sticker shock.

Because I’m a smart shopper, my next stop would be a site like SelectQuote.com. After I have a broad general notion of price, I want to get a realistic idea of the specific price I’ll be charged. And the best way to do that is to work with a person who knows what the life insurance companies and their underwriters are going to be looking for. Someone who can tell me which companies might actually consider me “super-preferred” and which wouldn’t. Or, if I smoke, someone who knows which companies have the best deals. Or, if I’m not in good health, someone who can steer me toward the companies that are most likely to consider insuring me. That someone is, in my opinion, the big plus that SelectQuote offers.

The other thing that a person can communicate much better than a computer screen with 57 quotes, is a sense of the character of the companies offering these prices. Many of the best term life insurance companies are not big brand names.

So, in summary, if you’re smart enough not to get attached to a specific quote, it’s okay to check the sites that will show you dozens of them. But if you’re really serious about getting the best price on life insurance from a quality company, don’t spend much time there. Go to a knowledgeable, helpful human being you can deal with online, by phone or face to face.

About the author. Mary Pollman, CLU, has been writing about life insurance, long-term care insurance and annuities for more than 20 years. She has contributed to insurance publications, websites, consumer product literature and agent training. Mary held senior management positions in communications and marketing with two life insurance companies. She is an editorial advisor to SelectQuote.

Get the best of both worlds with SelectQuote. Lots of term life insurance quotes. Personal expert advice. With SelectQuote, you can get plenty of price alternatives, all from highly rated life insurance companies. And, because you’ll be working with a SelectQuote Licensed Expert, you’ll know these are deals you’re likely to actually qualify for. Call us today, toll-free – 1-888-739-7965 . Or go to our website,

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