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I though term life was cheap! Do I need to shop around?

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  • afan
    replied
    Originally posted by Tim View Post
    Rest assured that a captive agent can quote and get a great quote and result in a denial. Aggregators as well.
    And independent agents can do the same thing.

    The last time I shopped home and auto, I shopped direct writers and used two different independent agents. The best deal come from one of the independents. If I had gone only with the first independent agent, I would have ended up with a far worse set of policies. Even when they got prices from the same insurers there were big differences in costs. The direct writers were better than what I got from independent agent 1, but not as good as what I got from independent agent 2.

    I would never have known this if I had not shopped.

    Leave a comment:


  • afan
    replied
    And again, the OP HAS an application approved. They can buy that policy, then shop for another, once they know what they need.

    I never shopped for life insurance with health problems and last shopped a long time ago. Nonetheless, the process of submitting an application was so different from that for getting a quote that I find it hard to imagine confusing them. The quotes were given based on information over the phone, I never signed anything for getting a quote. The applications were long forms that had to be completed and signed.

    The problem with using only captive agents or companies that sell directly to customers is that they will not show you quotes for companies that sell exclusively through independent agents. The problem with using independent agents is that they will not show you quotes for companies that sell exclusively directly or through captive agents.

    The only way to see prices from both parts of the market is to shop both parts of the market.

    The market is competitive and you find the best prices by comparing quotes from different companies.
    Shopping for insurance while ignoring a huge share of the market would be like shopping for a car but only looking at a single dealer for one specific make and model. You would have no way to know whether you got a good price.

    If the OP takes the policy offered, then shops, gets a better quote but the application is denied, then the OP can keep the policy they have.

    Leave a comment:


  • Tim
    replied
    Originally posted by FIREshrink View Post

    He's not going to get the most important information, which is: what companies are most competitive for his specific condition? Experienced non captive agents know this. Maybe there's one company out there which rates IBD better than standard.

    Aggregators are fine if you don't have health condition but if you do those quotes are pretty meaningless.
    Anonomous inquiries are possible by the agents. Rest assured that a captive agent can quote and get a great quote and result in a denial. Aggregators as well. The name of the game is volume.

    "It is not a sexy topic, but it is one of the most important (if not THE most important) topic in personal finance for doctors. Here are the top 10 questions about disability insurance for doctors, and an answer to each. Don’t skip this. It’s important, and that is coming from someone who screwed this up and cannot get disability insurance now." The Physician Philosopher has written much about this for a good reason. With a medical condition, do it yourself can have potentially harmful impacts. Some more serious than others."Oh, you mean you wanted a quote instead of an application? You said "Yes". Sorry about that. It was clearly stated in the box, "accept our 20 pages of disclosures". It costs you nothing. If you want to get a competitive quote, do it after you have a policy application approved.

    Leave a comment:


  • FIREshrink
    replied
    Originally posted by afan View Post

    To be denied, one has to apply. We are talking about getting quotes, which happens before application.
    OP has already been approved by one company.
    He's not going to get the most important information, which is: what companies are most competitive for his specific condition? Experienced non captive agents know this. Maybe there's one company out there which rates IBD better than standard.

    Aggregators are fine if you don't have health condition but if you do those quotes are pretty meaningless.

    Leave a comment:


  • afan
    replied
    Originally posted by Tim View Post

    Denials count, They are required disclosures and influence others. Shared application data.
    To be denied, one has to apply. We are talking about getting quotes, which happens before application.
    OP has already been approved by one company.

    Leave a comment:


  • Tim
    replied
    Originally posted by afan View Post
    What is wrong with getting prices from captive agents and aggregators?

    These quotes are free for the asking.

    If he does not like the policies he finds by doing his own shopping, then he would be under no obligation to buy them.
    Avoiding those sources of quotes simply means he will do an incomplete search and perhaps miss the best option.
    Denials count, They are required disclosures and influence others. Shared application data.

    Leave a comment:


  • afan
    replied
    What is wrong with getting prices from captive agents and aggregators?

    These quotes are free for the asking.

    If he does not like the policies he finds by doing his own shopping, then he would be under no obligation to buy them.
    Avoiding those sources of quotes simply means he will do an incomplete search and perhaps miss the best option.

    Leave a comment:


  • FIREshrink
    replied
    Originally posted by VagabondMD View Post
    30 years, 3M is going to be an expensive policy and likely much more than you need. Split it up and you can probably lower the rate. Or shorten the term to 20 years and look how much less expensive it is.

    How about 10 years $2M and 20 years $1M. Or ten years $1.5M and 20 years $1.5M. Or 10 years $1M, 20 years $1M, and 30 years $1M. There is a good chance that you will not need any life insurance from age 55-65 and an even better chance that you will not need a full $3M of life insurance at age 64, so there is no need to pay a rate that assumes that you do.
    30 year typically costs double a 20 year. This policy seems excessive and that is why it is expensive. As you suggest stacking policies is probably cheaper and doesn't over insure in the later years.

    Also since he has a medical problem, he definitely needs to see an independent agent and not a captive agent and not use an online aggregator.

    Leave a comment:


  • afan
    replied
    Inflation.

    The term policy pays nominal dollars. 10 or 20 years of inflation will dramatically reduce the value of those nominal dollars. Rather than guess at the amount needed, do some planning.

    Will there be more kids? What is the cost of living in your area? Are you now or do you expect in the future to help out parents or other family members? How much do you plan to pay to help with college costs? Grad school? Will you be buying a house? Will the spouse go back to work later? If so, what income might they expect?

    These answers can vary widely among people with the same income and assets. Such people would need very different amounts of life insurance. Work your way through and come up with an informed decision about how much insurance you need and for how long.

    For now, you could take the policy, then do financial planning and shop at your leisure.

    You could try the various online services to look for policies. Given the health issues, you will not know the real rate until the company goes through underwriting. Decide whether you are comfortable with waiting for that to happen.

    If it were me, I would get a policy in place now then do my planning and shopping. If I were to find I needed a different amount, different term or could get a better price, then I could switch.

    Leave a comment:


  • Dusn
    replied
    If you have a medical issue you need to shop around. You also probably don’t need 30 years if you’re saving well.

    My wife also has well controlled IBD on local therapy and had the same issue — she doesn’t even need systemic meds. But insurance companies aren’t doctors. They don’t know the difference. So shop around because the rates will vary widely.

    Leave a comment:


  • childay
    replied
    I doubt 30 year 3M is necessary with your income you should be able to self insure before then

    Leave a comment:


  • cards67
    replied
    Don't forget to account for SS survivor benefits, but personally I chose not to ladder.

    Leave a comment:


  • Tim
    replied
    “For term insurance policies, Prudential’s options are:
    • Term Essential.
    • Term Elite.
    • PruTerm One”
    One 30 policy is probably not what you need.
    The bells and whistles also add to costs.

    Basic term life is what you need. This is a commodify item. Shop what you need and don’t buy bells and whistles.

    Leave a comment:


  • Scott at MD Financial Services
    replied
    You should just do a pre-scan with about 50 carriers and then you will find out really quick if that offer is spot on or if you should look elsewhere. Probably will take you about 10-15 minutes and your agent a few hours of time, answers are usually back in 4-5 business days.

    Leave a comment:


  • SpacemanSpiff12
    replied
    I went through PolicyGenius - it was quick and easy to get quotes from 20+ companies. Simple to set up the actual policy as well.

    I think the WCI website has some independent agents listed who might be helpful too. But this is definitely a scenario where you want to compare many different companies. It's easy to do so and you can rest assured you'll be getting a competitive rate.

    Completely agree with the comments above about laddering.

    Leave a comment:

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