One of my 2013 goals was to get life insurance. I had a pretty hefty life insurance policy with my old employer, but now that I’m self employed, I don’t have any life insurance coverage at all.
Anyway, I’m looking for a 20-year term life insurance for $250,000. This will be enough to pay off our primary residence with a little bit left over for a cremation (or just donate my body to science). My retirement accounts and social security benefits should be plenty to raise RB40 Junior and put him through a state college.
*Whoa, I just found out that Oregon allows you to just use your backyard as long as you disclose the grave when you move. Now that’s cheap.
Last month I made an appointment with my Country Financial insurance guy and went in to get a blood test. The rates are different depending on how healthy you are and your safety habits. If you use tobacco, alcohol, drugs, travel to foreign countries, or have a lot of speeding tickets, then your premium will be probably be higher. They have 3 rates – standard, preferred, and preferred plus.
My blood test result came back quickly and I’m in the standard group. The rate is $525 for 1 year. That’s quite a bit more than I wanted to pay. I was hoping for around $300/year. The blood test result showed that cholesterol and triglycerides are a bit higher than normal, but everything else looks good. Even my blood pressure is much better than I thought at 114/80. I’m 5’4 and 135 lbs so my BMI is not bad either. I guess you need to be in perfect health to be in the preferred groups.
I figured I’d better shop around a bit. Maybe I can get a better rate with someone else. I tried American General Life next and they gave me a pretty quote. I think it was around $260/year. I’m sure it will go up once they get a hold of my blood test, though. I scheduled a blood test, but it kept getting delayed. Here’s what happened.
A nurse was supposed to come by and take a blood test last Saturday, but we had to cancel. She got into an accident and totaled her car on Friday. We rescheduled for this Friday, but it got canceled again. I think she had to see a doctor or something like that… (Hope she’s ok.) Now I need to reschedule again.
Third time is a charm?
I think I’ll try MetLife next. Snoopy is our lucky charm and maybe we will be able to get a reasonable rate. Their online form gave me a $360 quote. That’s not too bad. Let’s see if I can get a blood test scheduled and make it official.
Shoulda Woulda Coulda
Well, this is quite a learning experience. Now that I know more about life insurance, I wish I could have purchased some extra life insurance in my 20s when my health was perfect. The premium would have been set at a lower rate and stayed the same over the 20 year term. I had a ton of life insurance through my old employer and I got complacent. I think the coverage was 10x salary plus accidental death. I should have purchased extra insurance outside of work instead of going through my old employer.
It’s also not any fun to have your blood drawn for every application. Yuk!
If you only have life insurance though your employer, perhaps you should take a small policy out while you are young. Does anyone know a good affordable life insurance company I should talk to?
Get a quote from Fidelity Life through this link.
Response from a former insurance agent (Thanks Mr. D!)
I used to be licensed to sell life insurance, so I’ve got a little bit of experience on this from the other side. Depending on the firm that you apply with, they may be able to shop your policy around themselves. The benefit to this is that you would only need to go through one Paramed exam; to go through more than one is wasteful to all parties involved. For example, I used to work at MetLife. One of the reasons I started working for them was that they sold me on how they can write policies through 30+ different carriers; just get one exam and shop it around. However, once I got in the door, it became very clear that there was SIGNIFICANT pressure to push MetLife products over these other carriers, even if the other carriers had better rates, which was a contributing reason to me leaving there. I was young and learned some lessons from it.
Joe, what I would recommend is reaching out to your Country Financial agent and seeing if he’ll shop your policy around (to places like Genworth, Great West Life, Banner, MetLife, etc.). If so, you shouldn’t need to go through another exam. If he can’t, look for an agent from an independent agency (they can usually write through many, many providers). Also see if you can get them the results of the paramed exam. You may luck out and not have to go through it a second time. Even if you do have to go through it a second time, by going through an agent that will shop your policy, you’ll help ensure that you won’t need to go through a third exame.
Lastly, while this may seem obvious, be firm with the agent. Term life, while easy money for an agent (commissions are usually around 100% of first-year premium, minus the agency’s cut), because many people decide to go that route, every agent is trained to try to increase the amount that the customer puts with them, whether by increasing the coverage levels, pushing permanent insurance versus term insurance and/or by pushing for investment business as well. Especially if an agent gets the idea that there’s quite a bit of money available to manage – commissions on a variable annuity can be around 7% (as an example), so an investment of $500K is worth $35,000 to an agent. With that in mind, you’ll see why most agents will continuously ask probing questions, trying to divert attention toward what they’re interested in versus what you’re wanting.