PT Money » Insurance

The Long Road to Getting Life Insurance

PT — Wed, 18 Nov 2009 11:00:02 +0000

Do you need life insurance? Ever wonder what it’s like to go through the process of researching and selecting a life insurance policy? I highly recommend you get life insurance, but I don’t necessarily wish the buying process upon you. It can be tough to navigate.

That’s why today I’m going to share the steps you need to complete while searching for and buying life insurance. I’ll share my experience with buying my own term policy as well. This includes getting the life insurance quote (from someone like insureme.com), selecting the insurance company, taking medical exams, filling out applications, and a lot of waiting. Hopefully this quick guide will give you the confidence to take the steps to protect your family.

Step 1: Research the Type and Amount of Life Insurance to Buy

The last thing you want to do is go into the buying process without doing your own research. You need to understand the particular type of life insurance product to buy. And you’ll need to decide how much coverage to sign up for. I’m not going to go into those decisions here because I’ve explained them in prior life insurance related posts. But I will tell you that making those decisions is easy once you understand the different options.

And unless you have a particularly rare family situation, you don’t need an insurance salesman to tell you what type or how much to get. While I’m sure there are some very helpful, honest insurance salesmen, you don’t really need them with the wealth of free information available to you on the subject, and the online services / company portals that can help you find the best price.

This process took me only a few days, but I took some time before requesting quotes. I ended up deciding that I needed a $500k 20-year term life insurance policy.

Step 2: Request a Life Insurance Quote Online

Once you know what you need to buy, you can begin to shop around. As with any major purchase it’s good to shop around and try and find the best deal you can. Here are some options for where to shop:

Use a Life Insurance Broker – Insurance brokers are usually paid by the insurance companies to bring you in, so there’s no extra cost applied to you. A broker is going to have access to different insurance companies’ policies and rates. Therefore, they can help you find the best price. A great broker to start with is Insureme.com.

Straight to the Insurance Company – If you already have auto or home insurance with the likes of an Allstate or State Farm, you should see what they can offer in the way of life insurance and a combined policy discount.

Consider Your Employer – If you work for a big company, odds are they already have you set up with a life insurance policy with a minimal amount of coverage. They also will usually offer more coverage at reasonable prices. You definitely need to compare these prices to see if it makes sense to just buy more from them.People with current health issues should especially consider this insurance because your company is likely not going to require a health exam or deny you because of previous health issues. Keep in mind that you need to make sure that the policy can be converted to your own term life insurance policy in the event you leave the company.

I requested quotes with Zander insurance (the Dave Ramsey endorsed insurance broker), Allstate (my home’s insurer), and ING (ingforlife.com), who just recently started offering insurance through newly acquired ReliaStar. I also checked out my employer options. The quoting process took only a day.

Step 3: Pick a Highly Rated Life Insurance Company

After you get your quote information, don’t rely on price alone to make the decision. Swing by insure.com and check the rating for the company who will be insuring you. I feel safe saying that you wouldn’t want to go with an insurer with a rating less than A. You might also consider doing some general searching online for any issues / complaints with the particular insurer.

I ended up picking ING (ReliaStar). They had the best price, good service, and a good enough rating. Plus, I already have a comfortable relationship with ING’s online banking product.

Step 4: Get a Life Insurance Health Exam

Once you decide on a company, they’ll want you to complete a health exam. They will cover this expense, but you’ll need to schedule some time with the medical company that they use to complete the exam. The exam usually involves a questionnaire, blood samples, height and weight measurements, and a request for medical records. It’s typically done at a time convenient for you, at your home, and is really quick.

I dreaded the exam portion of this process, but it ended up not being that bad. The examiner was very professional and it was over with quickly. It took about 2 weeks from the quote to get the exam performed.

Step 5: Turn in Your Life Insurance Application

The application is usually given to the exam company, who then passes it, along with exam results, to the insurance company’s underwriter, who decides on your insurance class. You may be given the option to pay for your policy at the exam and lock in your insurance. I opted not to do this and to wait to see the final price.

Step 6: Wait for the Insurance Underwriter

An underwriter is the person working for the insurance company who decides if they can insure you and how much it will cost to do it. They factor in as much information as they can about you. The biggest factors are obviously age and health. There’s usually at least a 2 week wait from the time the exam is complete till the underwriter makes the determination.

Step 7: Pay Your Life Insurance Premium

Finally, when the underwriter is done, you’ll be sent your policy and information to make your payment. Once payment is received, you’re insured.

So that’s what you can expect when trying to get life insurance. It’s not an easy process. But I do feel strongly that it’s worth the hassle. I’m happy with the coverage I now have and I rest a bit easier knowing that my family has a bit of protection in the event something happens to me.

Have you purchased life insurance? Was your process similar? If you haven’t purchases it, what’s holding you back?

Photo by Corey Leopold

High-Deductible Health Insurance Plan Plus HSA

PT — Fri, 30 Oct 2009 11:00:14 +0000

General Motors recently announced that they are moving towards higher deductible insurance plans. Such things wouldn’t normally be news worthy. But here we are in the middle of a government controlled health care battle. Every piece of health care news seems to have an impact.

So, should you consider moving to a high-deductible plan, if given the option? Odds are if GM (who traditionally has “Cadillac” insurance plans…pun intended) is moving towards higher deductibles, your company will be too. Therefore, you should likely be ready to make this decision for yourself when the time comes.

Below I’ll present an example of someone who’s making the move. I’ll also provide some things to consider when deciding whether it’s right to make a similar change.

Moving to a High-Deductible Plan: An Example

I have a friend who’s current health insurance plan (covering him and two kids) is costing him $614.63/month with a deductible of $500 and a $20 copay. He’s considering a new policy: $278.08/month with a deductible of $5,600. His tax bracket is 25%.

He calculates that the savings on his monthly premiums will be $336.55/month, which is $4,038.60 in a year. That’s incredible savings on the premiums alone! He’s considering using a Health Savings Account (HSA) to stash the difference in plan costs.

Policy	Deductible	Monthly Premium	Yearly Cost
Old	$500	$615	$7,380
New	$5,600	$278	$3,336
		SAVINGS	$4,044

But he knows he can’t stop the analysis there. He factors in estimated usage: best case, he says his medical cost for all three people including dental and prescriptions would be $2,000. He’s a young guy, so I’m sure that’s fair.

Under the new plan, he’d have to pay all of this $2,000 out-of-pocket, or out of his newly opened HSA. So the $4,038.60 in premium savings minus $2,000 actual medical cost plus $500 in tax savings using the HSA equals estimated savings of $2,538.60 per year. Pretty good, right?

He says the worst case scenario would be that he has $5,600+ in medical expenses. He gets 25% tax savings, so of the $5,600 deductible, he would only spend $4,200. His other deductible was $500, so to compare he can subtract $500 from the $4,200 to get $3,700. Which compared to $4,038 (saved above) would give him an actual difference in yearly cost of $338.60 to his advantage. Basically, even if he pays his entire deductible, he comes out ahead.

My friend goes on to say,

“Even in the 15% bracket, my worst case would be that I paid $221.40 more a year than I would have with the other plan, which I believe is worth the risk when the savings are so big. Plus I can roll over from year to year and could get an interest-bearing Health Savings Account.

As long as I keep it funded correctly (paying the difference in premium to the HSA until I have it where needed, it should be a great financial situation for me. Once I get it fully funded, I can take the money that I was spending to fund the HSA and put into savings, a Roth IRA, etc.”

Factors to Consider When Thinking of Moving to a High-Deductible Plan

Okay. Let’s extract from my friend’s example some of the key points he used to help make his decision:

Will you save on premiums? In the example above, the answer was “yes”, and in a big way.
What’s your estimated usage? I like the way my friend used an average and then compared it to the maximum estimated spend. It might be prudent to break out last year’s actual costs to provide some more perspective.
Should you be trusted to setup the HSA and contribute? My friend seems to think that would be a easy thing for him. And I agree. The fact that he’s even taking the time to make this calculation shows he’s got the initiative to make the savings happen. And he’s obviously had the money each month if he’s been making that kind of payment. There are some eligibility rules for HSA you should know about. I may discuss that in a later post.

But what are some other things to consider?

Are You Getting Similar Coverage with the New Plan? My friend didn’t mention a couple of things when discussing his old plan vs the new one. The maximum annual out of pocket allowed and the difference in the actual coverage of the plan. If he didn’t already, he should go back and factor those things in.
Are you healthy enough? If you’re already maxing out your current plan and you have some serious health issues that require prescription drugs, odds are a high-deductible plan isn’t for you.
Are you about to try to get pregnant?
Do you have pre-existing conditions?On an employer plan, pre-existing conditions aren’t a problem. Moving to a high-deductible plan will create a re-start in your coverage and the insurer is likely to charge you more for those pre-existing conditions.

Where to Find a High-Deductible, HSA-Compatible Plan?

I was doing some research of my own the other night after I learned of my buddy’s situation above, and I stumbed upon a nice website that will quickly provide quotes for high deductible insurance plans. I was surprised at the nice rates, the quality insurance companies listed, and the speed with which my quote was turned around (instant). It’s called eHealthInsurance.com. Click here for quick access to a quote on HSA-Compatible Plans.

What’s your take? How do you feel about the analysis done above in my friend’s example? Have you or are you considering a move to a high-deductible plan? Share your experience below…

Photo by Mozo Man

Why I Bought a $500k 20-Year Term Life Insurance Policy and You Should Too

PT — Mon, 05 Oct 2009 11:00:11 +0000

A good term life insurance policy is something most people should have.

I’m sitting here writing a check for my life insurance premium. I’m so glad to have this process over with. As most of my regular readers know I’ve been talking about getting life insurance since the birth of our first child, seven months ago. The process has been a long one. But I’m finally done. The receipt of this payment will seal the deal on a $500,000 20-year term life insurance policy.

When I first started this blog I was clueless about life insurance. It’s just one of those products no one wants to talk about. I started caring about it about the time I found out we were having a baby. Over the past year or so I’ve picked up a lot of good information and formed an opinion about what type and how much life insurance product works best for me. I actually have a small policy through work, but it’s only for a small amount. I knew I needed more.

Why Term Life Insurance?

I decided term life insurance was the way to go (vs whole life insurance or some other product) for the following reasons:

1. I plan to self-insure in the future. Twenty years from now I won’t need life insurance. I’m planning on having at least $500,000 of my own at that point. I’m taking serious steps with my retirement and short-term savings so that as soon as I’m able I can drop life insurance and rely on my own stash.

2. I’m of the opinion that investing and life insurance are two separate things. Why the heck did investing and life insurance ever get involved? Insurance products that promise investing returns are just an expensive waste. Keep investing simple, inexpensive, and separate from your insurance goals.

3. It’s inexpensive now. I was able to get my term life, 20 year, $500k policy for around $45 a month. For what it’s worth, I’m in my mid 30s, a non-smoker, and in good health. My weight was the only thing that took me down from the elite to the standard rates.

4. I don’t have a special needs child. People with special needs children should consider a whole life insurance policy since they may have a dependent for the rest of their lives.

Why 20 Years?

I decided on 20 years vs 25 or 30 because, again, I plan to be self-insured in 20 years. And, I expect all my kids to be close to adulthood by that point. They are why I’m getting life insurance, so it makes sense that I drop the insurance about the time they don’t need me anymore.

Why $500k?

I decided on $500k because that would be enough to replace a good portion of my income. If I passed, my wife would still have to work (which she plans to do anyway), but the extra income would allow her to breath easy and not put our home, her retirement, or our kid’s education at risk. Life insurance is all about replacement of income. But no one says it needs to be 100%. Especially for a couple that already lives well below their means.

Editor’s note: I realize my choice to go without life insurance on my stay-at-home wife is not the best answer for most people.

You Should Buy Life Insurance

As you can tell from my thoughts above, I’m of the belief that purchasing life insurance is a good thing for those who need it. If you aren’t self-insured and you have someone other than yourself dependent on your income (and they will be for some time), then it’s probably wise to get yourself some life insurance. A good term policy can be had for the price of Internet service each month. So if you are reading this blog post, you can likely afford it.

Later this week I’ll share my experience with actually getting the insurance. This includes getting quotes, selecting a company, taking exams, filling out applications, and a lot of waiting…

Personal Updates and Links: New Insurance for this Bada$$ Blogger

PT — Sat, 12 Sep 2009 12:45:35 +0000

It’s been a while since I’ve shared some of my personal updates as well as some of the more interesting things going on around the interwebs. I’ll take today’s post to get you up to speed.

Recent Local Blogger Meetup

I recently had the opportunity to meet another personal finance blogger that lives in my area. Jason from One Money Design and I met at our local library to discuss blogging, finance, life, and generally just get to know each other. I had a great time and enjoyed getting to meet someone from the online world in “real” life. You can learn more about Jason by visiting his blog (www.onemoneydesign.com), signing up for his free updates, and by following him on twitter (@onemoneydesign).

New Auto Insurance Policy

While I was doing some searching for life insurance (Yes, I’m still in the process of getting life insurance. Almost done though. I promise.), I stumbled upon a nice auto insurance deal from a professional organization that I’m a member of. I ran a quote with GEICO and was pleasantly surprised. I’m going to sound like a commercial here, but “I saved a bunch of money by switching to GEICO.” A word of caution to those who may be considering a similar move: be sure you compare the old policy and the new one side-by-side to ensure you’re getting the same coverage. My new policy has the same coverage AND it’s around $200 less per six months.

Blog Updates (if you care)

You may have noticed the subtle branding changes I’ve made to the blog. I’m moving away from the “Prime Time Money” name and simply going with “PT Money”. With the url being ptmoney.com, I just thought it made sense to make things concise and just go with the one name. But just because the name is changing, it doesn’t mean the focus is now all on me, PT. The goal will still be to provide you with content that’s of interest to you, first and foremost. Contact me if you’d like to discuss a particular topic, or if you have a story to share.

I’m happy to report that the side-income that I’m able to produce from the site has really been strong lately. In a future post I’d like to share how I make a bit of extra money from the blog. I occasionally let myself think of one day making a full-time living from this site, but realistically that’s still a few years away. David from Money Under 30 recently shared his story of becoming a full-time blogger. A great read if you’re into that kind of thing.

In other news…I’m a bad@ss. Well, at least my blog is. The fine folks at this Australian Credit Card website listed PT Money as on of the Top 25 Badass Personal Finance Blogs. Very cool list of friends, as well as some pretty sweet caricatures of some of us. Check out my bling, yo.

Does it look like me?

Further Thoughts on Life Insurance

PT — Mon, 16 Mar 2009 11:00:46 +0000

This post discusses whole vs term life insurance.

Over the last couple of weeks we’ve been discussing life insurance here on the blog. See Life Insurance Round-Up and a guest post titled Do You Need Term Life Insurance?. I thought I’d wrap it all up with my somewhat scattered thoughts on the issue and tell you what I plan to do.

If you’re in the market for some life insurance, I encourage you to do your own research or visit with a fee-only financial planner before making your own decision. Most of what I’ve learned on the topic recently has come from the round-up post and from Liz Weston’s book, Easy Money.

Who Needs Life Insurance?

The idea of life insurance never popped into my head until I had a kid. No one was solely dependent on my income until that point, nor did I have any debts jointly owned with Mrs. PT that she couldn’t handle on her own. That view was probably a bit short-sighted, but since I have a small policy with my current employer, I thought I was fine.

Mrs. PT even had a small policy of her own when I met her and I encouraged her to drop it, thinking that no single person should ever own life insurance. I mean, who’s going to benefit besides her creditors? Bob at Christian Personal Finance discussed life insurance for people with no kids in greater detail. I encourage you to check out his thoughts and the comments.

Anyway, the general rule of thumb here is that if you’re single or married with no kids and each spouse has their own solid income, it’s unlikely that you need life insurance. Everyone not in that group should seriously consider life insurance, to protect those dependent on their incomes.

How Much Life Insurance Should You Get?

The next logical question is “how much to get?” Again, I’m going to throw out another rule of thumb here: 8 to 10 times your current annual income. Your particular situation may warrant another number, but it’s best to be conservative and over insure.

Things to consider: ages of your kids, whether your spouse also brings in a equitable income, your level of dependence on both incomes, the amount of debt jointly owned by you and your spouse (the surviving spouse becomes solely responsible upon your death), and other factors. Do a search for “how much life insurance” calculators and work the numbers for yourself.

If you’re already getting life insurance from your employer, don’t heavily count on it. You’re likely to change jobs at some point and your coverage typically won’t follow you.

Can Insurance Be An Investment?

Something brought up in the comments of the guest post was the use of the term “investment” when discussing life insurance. Some find that offensive and label it a sales trick to convince you to move away from term life insurance products to the more involved (commission friendly) whole life insurance policies.

What’s the Deal with Whole Life Insurance and is it an Investment?

A friend recently contacted me through my Facebook profile saying that he had someone trying to sell him a whole life insurance policy. My friend is a single guy with no dependents. I immediately advised him that he doesn’t need life insurance at this point and that anyone suggesting he “invest” in a whole life policy is likely just wanting a commission. My friend, who’s in his 30’s with little or no debt, could do much better to invest his extra money in index funds and interest bearing savings accounts.

So are whole life policies inherently bad? I think they’re not. It could be said though that most people just don’t need them. Liz Weston points out a couple of situations where whole life might be a good choice:

People with disabled and/or permanently dependent children
People that are extremely wealthy that need insurance money to cover their estate taxes

Although there are many types of insurance products that fall under the “whole life” umbrella, it can generally be said that they are often more expensive, unnecessarily complex, and make poor use of your extra savings.

Still, insurance in whatever form, is simply a financial product that can be used for positive or negative results. A quick example:

Who’s the smarter investor:

the 60 year old widow who currently has her money “invested” in a whole life, cash-value insurance plan? Or,
the 60 year old widow who currently has her money invested in a diversified (defined prior to 2008) portfolio of stocks and bonds?

The former is likely retiring when she originally planned. Due to the downturn in the Market, the latter is potentially re-thinking her strategy and planning to retire later in life now that her investment has gone south.

Another type of insurance you might consider is return-on-premium term life insurance.

What We Plan to Do

We plan on purchasing a term life insurance policy (likely 20-25 yrs) on me, the primary earner, for 5 times my current income. We’ll shop around at the following providers to determine the best place to purchase the policy: Allstate (current home and auto insurer), Zander.com (Dave Ramsey recommendation), and through my professional organization discounts.

We’re also going to insist that the policy is convertible to a whole life policy (should we need it) and from a provider with a high rating.

One last point: we plan on living well within our means throughout our lives. In fact, our goal is to be able to live within one of our incomes at all times. Even when Mrs. PT (who’s now in grad school) goes back to work full-time. That being the case, we hope that life insurance is never a big part of our overall risk reduction plan. We plan on “self-insuring” as much as possible by eliminating our debts and building solid savings and retirement accounts.

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Okay. This is topic is officially dead (pun intended). Mrs. PT said she is tired of this topic and wants to just buy it and move on. So that’s what we’ll do. As usual though, I welcome your comments below if you’d like to carry the conversation forward.

Do You Need Term Life Insurance?

Guest — Wed, 11 Mar 2009 11:00:35 +0000

Do you really need term life insurance? Term life insurance can offer your family many benefits. Before you decide on a policy, you should determine your specific needs. Knowing more about this insurance option will help you find an affordable term life insurance plan with the benefits you want for your family.

The Benefits of Term Life Insurance

Term life insurance can be purchased for the specific times in your life when you need some extra insurance. Since you are not expected to keep the policy for your entire life, the they are often cheaper than whole life insurance options because there is a smaller chance that your family will actually need to use them. In comparison to the alternatives, many industry experts argue that whole life policies are not the best investment as the return on investment is very low. Thus it might make more money by investing in the term life policy, as it is cheaper, then use the excess to invest in stocks or a different long term investment.

The Disadvantages of Term Life Insurance

While it is something you buy hoping to never collect on , one of few disadvantages of term life insurance is that you can only get a return on your investment if you die, unlike whole life which gives a return at the end of the policy regardless if the party is living or deceased. Some insurance companies will give you the opportunity to extend the term of coverage, but the rates can become much higher and discourage consumers from continuing their coverage

Who is the Audience for Term Life Insurance?

Term life insurance policies are useful for families that significantly rely on the incomes of one or two people in the household. Typically, couples buy term life insurance when they have children and need to take their financial well being into account. If one of the parents dies before the child is grown, the other will get money from the policy to help raise the child and pay any expenses.

As your children grow up, though, you might not need the extra insurance. They can take care of themselves, so there is not a reason to continue paying for the term life insurance. Likewise, at this point in your life you are probably more financially secure. If you suddenly died, your spouse might be able to live without your monetary contribution much more easily than when you were younger and had children in the house.

As with any investment, it is best to take into account all factors that surround it (including how much life insurance do you need?) to ensure that you will receive adequate coverage for the investment.

Today’s post comes from Barbara Waltz at 247QuoteUS.com:The Smart Insurance Blog [RSS]. Barbara was kind enough to expound on the benefits or term life insurance, a product Mrs. PT and I are interested in since having our little girl.

Life Insurance: When and Where to Get It?

PT — Fri, 27 Feb 2009 12:00:53 +0000

In this post I share responses regarding when and where to get life insurance.

With the arrival of our new baby, the question of what to do about life insurance comes to mind. To help us get some perspective, I reached out to some of my blogging friends and readers and asked them this question:

“ Do you currently have life insurance on yourself or your spouse and where should one go to find the right life insurance?“

Their answers are below:

Sense to Save – We have life insurance on myself (a SAHM) and my husband. We have policies through my husband’s employer and also through Zander.com.

No Credit Needed – My wife and I both have term life policies, purchases through a local life insurance agent. He gave us a comparison of several life insurance companies, and we chose a company with a combination of low price and high rating.

Free From Broke – I get life insurance through work. I must admit this is an area we have to look into more thoroughly though.

Wide Open Wallet – We both have life insurance. I think it’s an absolute necessity while raising kids. In my opinion, term life insurance is the only way to go.

The Happy Rock – Yes we do. We have about 6 times my current salary. With no debt except a mortgage that sum will easily pay off the mortgage and give my wife plenty room to decide were the family needs to go. We probably need a little more insurance on my wife, so that I would be afforded similar options though. When we search we will only buy 20 or 30 year level term insurance from a highly rated company. It isn’t worth bother with things like whole life and other so called insurance innovations that are really just ways for them to make more money.

My Money Minute – As far as Life Insurance goes – we went through Dave Ramsey’s recommended broker, Zander Insurance. They give you quotes for a bunch of different insurance companies, and you can choose which one you want. We have 20 year term life insurance. You may need less, but we each got a $1MM policy. It costs about $75/month ($900/year) total for both policies, and we bought them about 18 months ago. For what it’s worth, I would tend to agree with Ramsey’s analysis on term vs. whole life insurance. I’d rather just insure against catastrophe and invest my money elsewhere.

No Debt Plan – Yes, yes, and yes. We both have life insurance policies. We used AccuQuote.com to find the cheapest deal specifically because we had read about it in Money Magazine. I think SelectQuote is similar if you want to really price compare. We were happy with the cost and got that taken care of in 2007. They are 20 year term life plans — none of that whole life garbage for us.

Budgets Are Sexy – YUP! The spouse and I signed up for it a couple years back when we first moved in together. We both have 30 year Term Life Insurance and pay about $55 total each month for a $350k policy each. The first place I’d recommend hitting up is USAA if you’re eligible (had to have been in the military, or related to someone who is/was). They’re always super competitive, and their customer service is beyond any other I’ve come across! Next, I’d check around w/ other PF Bloggers and see which companies they like.

The Shauls – We applied with a insurer but were denied due to our occupation. I guess it’s hard to measure a missionary’s risk level. I am going to reapply, however, with a different company. For me, it boils down to the right information with the right agent. If I feel like the guy on the other side of the table is just interested in selling me something, I’m moving on. Good thing for me is, insurance runs in the family. After three generations of private ownership, my relatives know their stuff. Look no further than http://chastainotis.com/.

Christian Personal Finance – I recently discussed this with my wife and because of our current favorable financial position we had decided against getting life insurance until we had kids. I wrote a post explaining my reasons for not having life insurance as a D.I.N.K, but thanks to some enlightening and persuasive comments from the readers I have been rethinking my decision.

ABCs of Investing – Life insurance – yes I have it. I’m the sole breadwinner in my fam so if we want my wife & kiddies to keep the same standard of living if I kick the bucket then it is necessary. You should be able to look up quotes online.

Moolanomy – Right now, I have a group term life through my job and my wife has a term life. I am in the process of shopping for my own term life, but with limited success. If you have a good relationship with your insurance agent, you can start there. Otherwise, you can try sites like NetQuote or InsureMe.

Rocket Finance – Life Insurance is one of the cheapest ways to provide for your family – everyone should consider long term care insurance as well.

Good Financial Cents – I currently have third party life insurance on myself. My wife has term insurance through her employer. Any reputable insurance agent and/or company will do. Be sure to check the stability of the insurance company and also shop around. When you do get a quote, make sure that they are not quoting you the “Superman” rate (unless you truly think you are that healthy). I would first start with your employer with insurance (group rates tend to be cheaper than third party). Your employer will only typically insure you up to a certain amount. If you need more, then go to the third party. In my experience, going to third party carriers that only offer proprietary insurance will be more expensive i.e. State Farm, AIG, Farmers. It might not always be the case, but several years ago my wife worked for AIG, for a bit, selling insurance (Thank goodness no more). With my old firm, I could offer AIG insurance as well as many other different carriers. She ran a quote for a guy and, out of curiosity; I ran a quote for the same guy with same type of AIG insurance. Guess what? If he bought it through me, it would be about $20/mo cheaper. I’m not exactly sure why, but since then; I’ve always assumed that by going to just one company, you will probably pay a bit more. Editor’s note: read where Jeff discusses term vs cash value life insurance.

My Dollar Plan – We also have life insurance on both of us. Term insurance both through group coverage at the employer and purchased outside from a quote on Insweb.

Bible Money Matters – As far as life insurance, that’s one of those things I keep meaning to do, but don’t get around to. I’ve done some searching through Dave Ramsey’s suggested zander insurance, as well as insureme and netquote (I believe).

Free Money Finance – Yes, we have life insurance on both of us (though different amounts.) I went online, got a low price, then told an agent who I knew that he could write the policy if he matched the price. He did.

Reader J – We have limited life insurance through our job, but I’ve been considering Prudential. They hold my 401(k), and seem to be weathering the storm so far.

More reading from Four Pillars: How Much Life Insurance Do You Need.

Thanks for all you solid answers, guys. I appreciate the information.

If you’ve got an opinion on life insurance, I’d love to hear it. Share it in the comments below.