making life simple
By Kirby Thomas
It's easy to see why many people think life insurance would be easier to buy if life insurance itself was simpler to understand. Consider the two major types of life insurance: Temporary and Permanent. Within these broad categories, you can choose from such products as Level Term, Decreasing Term, Whole Life, Universal Life, Variable Life, Variable-Universal Life, first-to-die, second-to-die, and so on. Life insurance policies can be customized with the addition of "riders" that reflect your individual circumstances and personal preferences. Moreover, life insurance companies use a form of legalese in the policies they offer because life insurance is a legal contract.
As if all the choices weren't enough, some agents, in an effort to be precise, use the same legal language to talk to non-industry individuals. For this reason, life insurance sometimes loses clarity from the first words of a conversation between an agent and a potential buyer. It's not the only reason, but its right up there at the top of the list. An experienced, successful agent is an active listener who identifies her clients' needs in order to present life insurance policies that offer the right coverage for each family's unique situation.
I consider myself a good agent because I try to be clear and factual, among other things. So, when I call a new client for the first time, I like to provide an easy-to-understand description of the two major types of life insurance.
There is temporary life insurance and permanent life insurance. Temporary life insurance is called Term Insurance and it lasts for a period of time: one to five to 10 or even 15, 20, or 30 years. The number refers to the period of time that the payments and the coverage are kept level. It's usually the cheapest form of life insurance.
Permanent life insurance lasts for the rest of your life. Whole Life insurance is what some people ask for, but let's be clear; what they usually mean is "permanent insurance." There are several types of permanent insurance and Whole Life is one of them.
Interest sensitive policies such as Universal Life and Variable-Universal Life are also permanent. The most expensive form of permanent life insurance is Whole Life and the least expensive form of permanent life insurance is Universal Life.
Any buyer of life insurance realizes after a couple of minutes that one of these is what they had in mind and that the rest are not. Some buyers may question the utility and cost of each of type, so I supply answers that illuminate the advantages and disadvantages of each in a search for the appropriate type of plan that fits that particular buyer's needs.
Searching for quotes on the Internet is best accomplished with the help of licensed agents because they can provide guidance and clarity, which comes with knowledge and experience.
Getting a quote is a good thing. But getting an agent who will clearly explain life insurance and help you find the right plan is a better thing. Want proof? Here's your quote: $358. Ok, now what? Would you buy that number? Of course not, since no one ever buys the number. What you buy is the coverage described in the plan. Coverage that is either right for you or isn't right for you. With a little help from an agent who can make the process simpler and clearer, you can be certain that your dollars are well spent on the right plan that will provide security for your family.