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LIFE & DISABILITY INSURANCE -
Factors to Consider When Buying Life & Dis. Coverage (cont.)
j. Employer group disability plans may be a good deal. If you require short-
k. If you buy your disability policy from an insurance company where you have your life insurance policy you may receive a discount. You may also receive discounts if you buy life or disability policies from the same company where you purchase your homeowner’s and automobile policies. Just ask.
Getting the Best Price for Life & Disability Insurance
Although life and disability insurance companies are regulated by your state insurance commission, their rate structures vary widely. So, it pays to shop around for the best rates, which could easily save you hundreds or thousands of dollars annually. Consider plans offered by your employer, as well as any associations where you have membership. But make sure you shop around for policies from other sources also. When shopping, keep the following in mind:
1. Meet with two or three of the major life and disability insurance companies such as Met Life or Northwestern Mutual. Work with these companies to figure out what types and amounts of coverage are right for you. Once you decide what coverage you want, get a quote from each of the companies based on this coverage.
2. Using the coverage descriptions discussed above, contact other major insurance companies and get a quote. If you qualify because of prior experience in the Armed Services, make sure to contact USAA to see what they have to offer.
3. Using the coverage descriptions, contact two or three independent insurance agents to get quotes. Independent insurance agents generally represent several different less well known, but reputable, insurance companies that may offer better pricing.
4. Using your coverage descriptions, go to the Internet and apply for coverage with some of the better known insurance companies that sell over the Internet to get a rate quote. You may also want to visit sites like Insurance.com where several insurance companies are represented, and rates can be compared.
5. Now that you have decided what types of coverage and amounts you want, and have found an insurer that you like, consider the following before making a final decision.
a. Because of state regulation, it is rare that an insurer will fail and not be able to pay your claim, but it does happen. So if you have decided to deal with a less well known insurer, and they are represented by an independent insurance agent, have that agent demonstrate to you that the insurer is financially secure. This will generally be done by showing the rating an insurance company has received from an independent insurance rating agency. If the company is not represented by an independent agent, or you are still concerned, call the State Insurance Commission to inquire or do some research on the Internet at insurance company rating sites like Moodys.com and AMBest.com.
b. While the company you are considering may be financially solid, they may or may
not have a reputation for settling claims in a hassle-
6. Unlike automobile and property insurance, now that you have chosen your insurance company you will most likely keep your insurance policy for many years to come. However, if your health continues to be good, you may want to shop around every few years to see if prices have come down. If so, inquire with your insurer to see if they can make a premium adjustment. Also, if you are considering buying more life or disability insurance you do not need to limit your search to the companies that carry your present policies. It is perfectly fine to have policies with different companies at the same time.
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