How to Compare the Whole Life Plans of Various Insurance Companies
Whole life insurance is more than just coverage for when you die; it's also an investment. If purchased correctly, whole life will provide money not just for your loved ones but for your retirement. Whole life is much more expensive than term life and therefore is a purchase that requires careful research. Comparing different policies is important to selecting the right policy for you.
Other People Are Reading
Instructions
-
-
1
Add up all the fees and commissions associated with each policy. This information should be in each policy folder but ask the insurance salesman to explain these details. Some companies take the whole first year of payments to cover fees and commissions. Know how much you are investing compared to how much you are paying for the investment management.
-
2
Look at the monthly payments. While you can decide to some degree your monthly payments based on your investment strategy, make sure you can make the payments. You'll want to have enough insurance to cover your funeral expenses and to cover any financial burdens your family might face when you die, such as paying off the mortgage and providing for your familiy's future. However, you should not purchase so much that you don't have the money to pay your bills and have money for short term savings as well.
-
-
3
Research each company's financial history to see how well each does at managing investments. Find out how long each company has been around and how financially secure each insurer is for the future. You can find this information from rating companies such as A.M. Best.
-
4
Compare the rules for removing money, in part or in whole, early. There may be fees and limitations that can prevent you from getting your money out. This information should be included in your policy papers; ask your salesman to explain the details. Calculate how much you will lose if you have to stop making payments, cancel the policy or take out various amounts of money for an emergency.
-
1
