Positive experiences with Life Insurance brokerages????

[SHIVAN]

I need to get a term life policy, has anyone had glowingly positive experiences with one brokerage or another from either a current buyer, or recent (10 years) beneficiary?

If so, please let me know. I don't need to know the amounts, types or anything else. Just if you are happy with your experience and the pricing, or the way a death was handled via the insurer.

Thanks.

[chadbag]

I don't have a personal experience with them but since I trust Dave Ramsey, when I need to get a new policy in a year I will be going through Zander insurance, which is who Ramsey plugs.

[6933]

Don't touch a brokerage with a ten foot pole. Are you eligible for USAA? If so, the search is over. Very pleased with terms, coverage, and cost. Otherwise, try Amica and then MetLife. USAA #1 in rankings and Amica generally #2. Isn't Ramsey paid by, and part owner of, Zander through Zampo?

[MC988]

+1 on USAA, great company.

[JackOSU]

As mentioned before say away from a brokerage. They are crooks and will often times not explain to you all the fine details that CAN be in a life policy. If you have your personal insurance with a reputable company like USAA, State Farm etc you need to sit down with your agent and discuss things. Make sure if you buy a term policy from no matter what company the rate is guaranteed for the whole term. Make sure that the policy has a guaranteed convertability option until the last day of that said term.

Some companies will give you a rate on say a 20 year term policy, but the rate is only guaranteed for the first 10 years and you're like WTF when the rate goes up. With the convertability option it's very important b/c what if say during year 19 month 11 you are diagnosed with terminal cancer? There is no way you'll ever be able to buy insurance again. Now this may or may not be important to you, but if you want to leave your familiy something you will need to have a company who's term policy is guaranteed to let you convert to a permanent policy up to the last day of that term without underwriting requirements at their standard rating.

Now this is important b/c even though you may be 20 years older from the time you got that 20 year policy and it's really going to be more expensive for that say 6 months or until whenever it is you die you'll know that the death benefit your familiy will receive tax free will be worth it versus the short term burden of cost. Sometimes this situation is hard to talk about and I've had to sit through a few times where it's a balling fest with the family b/c they know the other is dying and there is nothing that can be done so the very point of planning their death sometimes doesn't settle well with some. I can't blame them. It would be pretty tough sitting in someones office talking about this b/c you're dying in 4-6 months.

Note however during this convertability you cannot increase the death benefit amount so number one is determining your actual need for life insurance. The best way to do this is following the below acronym for LIFE. Once you have the amount you and your spouse each need it's a matter of determining how much you can afford in your budget and buying as much as you can possilby afford. It's also very important to review your finances with your agent. If he's worth a grain of salt he should be able to help you find additional funds to help pay for this policy.

I love it when clients of mine come in with a $5 cup of Starbucks, but say they have no money to help protect their family and want to pass on paying $30/month for a basic term policy. I do not allow them to walk about without setting them straight with the facts. Hey I may lose one or two out of thousands I talk to about this b/c they get offended by me calling them out on it, but I'd rather do that and have all of the others walk out of my office better protected than saying, "oh that's okay well just keep that in mind" etc. How am I going to feel if they get into a car accident and pass away and their familiy comes to us asking if they had a life policy and we have to tell them no all b/c I was too chicken shit to call them out as they sip their $5 cup of coffee.

L- Loans: school, vehicle (for most this is revolving debt with a car loan), mortgage balance, cc debt, etc.

I- Income replacement: This is often the most over looked area. Most are advised to only get enough coverage to pay off all debt and put one in a pine box and be done with it. This is not doing the client justice. Your spouse and family will need time. This figure is that time. The best rule of thumb in order to more properly replace the income you have made for your family in order to help them sustain the same lifestyle they were accustome to. This is different for each family, but generally I suggest 5 times one's salary to buy time short term. If one is looking to possibly be able to use said funds in the death benefit they receive and invest it a certain way so that the principal will never be touched and they can earn their spouses former income solely by interest then you may need anywhere from 7-12 times their income depending on how much they brough home NET wise. Again you are buying time for grieving with this figure. It is often the highest figure/category for determining how much coveage you need.

F- Funeral/Final Expenses: The average cost for a decent funeral in my area is 10-12k. This include all burial and plot costs etc. Now just remember that this figure like all figures can change dramatically with inflation. Most suggest that the actual cost of things will double in 12 years on average. So plan accordingly so you don't end up in just a pine box.

E- Education: This is primarily geared for your children of any family member. Some also view it as the gifting section if one wants to leave monies to a foundation or their church etc.



Please note that some of what I have gone over is only one small piece of the pie of my discussion with a potential or current client and is not the end all be all. There are many things I would ask and talk about, but there's no way I could type it all out here so I guess this is my disclaimer in a sense, but just make sure you're dealing with a solid person you trust and again stay away from a brokerage if at all possible. I've even heard horrible stories from someone's financial advisor giving them bad information b/c they dont' understand the policy they are selling for as amazing as that sounds. Make sure the company you buy from has no less than an A rating in the industry. Their financial strength is very important. Stay away from companies that invest their funds used to pay off death claims in risky investments or the market in any way.

Most importantly when it comes to life insurance stay away from Dave Ramsey. His philosophy is to buy term and invest the rest if you will. He does not believe in permanent life insurance, but I've had countless clients come in who've lost everything to most of their "never money" in the market whether small or large cap to whatever was the latest and greatest thing at the time that made up their portfolio with the invest the rest action/mentaility.

I can then show you clients who've been steered away from that and gone with a permanent policy and are waaaayy ahead of the game. Their policies are so well off it's rediculous. One good book I higly recommend when looking at some very very basic knowledge is a book called "Missed Fortune". If you truly are interested in how a permanent life policy "could" help you some what in your life with your finances etc you will be amazed at the powerful information in this book. That isn't to say that this mode is for everyone to know or even implement but if one has the ability to follow this advice for how they view money etc it's a great start. Then if you're ready to take it to the next level check out the book "Becoming Your Own Banker" by Nelson. Sorry I know I've rambled on quite a bit here, but good luck with your hunting and make sure not to buy on a whim and do some research first! The most important thing is that you understand that you need the coverage and that's the hardest hurdle to get over sometimes.

[Gramps]

Don't know yet. Haven't died yet!

Shame on me. No one in my family has gone with one yet so I don't know.

[A-Bear680]

+1 on USAA, great company.

Another vote for USAA. They recently expanded their market to include everyone with documented honorable US military service.

[SHIVAN]

I do not qualify for USAA. My employer's default life coverage is through Metlife.

State Farm has a clause that allows for a variable premium over the life of the term, which I do not like.

I looked at Prudential, Acacia, State Farm and Metlife so far. I'd rather not use Metlife, only because if something happened they would be paying one policy already, and I would rather not complicate it with a second through them.

[Left Sig]

I already went through this earlier this year.

Avoid any insurance company that also does P&C (Property & Casualty, i.e. car, home, etc.) - stick with one that specializes in life insurance. You will get an agent that knows the product better because of the specialization. Also avoid companies that are stock based - stick with mutual companies.

Go with one of the top mutual life insurance companies in terms of their financial position and dividend rates. That usually means Northwestern Mutual, Guardian, Mass Mutual, and a couple others.

My wife and I went with Northwestern Mutual. Since we are relatively young, we bought term-to-80 (80 years old) policies with guaranteed conversion for the first 20 years. The rates are not level, but scheduled to increase slightly each year. This is not as bad as other people might lead you to believe for a variety of reasons, and offers several benefits.

The whole Dave Ramsey thing is funny. I like the guy, listen to him occasionally and find some of his advice is pretty good. But some of it is just bad too. Mostly, the calls I've heard are from people with stupid high credit card balances and big loan payments on cars they don't need. In those cases, eliminating the credit card debt is the first priority. He wants everyone to be debt free, but that's not the most financially sound decision in many cases. When I hear him tell people NOT to invest for retirement until all of their debts are paid off I cringe. Sure, don't invest money at a 5-10% return if you're paying 27% on credit cards. My wife and I carry grad school tuition debt at 2-3%. There is no reason to pay it off at that rate, since the long term return from retirement investments exceeds that and we are money ahead if we invest.

Buying term and investing the rest is actually not a bad idea, except most people never actually invest the rest. And the few that do often invest it in such a manner that they get poor returns.

Permanent life insurance offers a modest but consistent return, that is better than or equal to other conservative income generating investments. Any balanced portfolio should have a mix of high risk/return equities along with lower risk/return investments. If you're young and have 30-40 years until retirement, you're going to be invested mostly in equities. But the older you get, the more you need to balance the portfolio away from high risk/return to more stable investments. Life insurance can be that stable investment in your portfolio just as well as money market funds, CD's, or income funds can. Income funds are usually based on insurance company debt, which is kind of ironic.

[EzGoingKev]

+1 on USAA, great company.

I am not a member of USAA but I did work for a company that was contracted to provide a service to them and their membership. I can say that all of their members that I dealt with always spoke very highly of them. I might have even dealt with some of you here.

To them you are not a customer, you are a member. Member satisfaction is their #1 priority. They dispatched appraisers and resolved claims faster than any other insurance company I had dealings with.