How to Buy Life Insurance

Why trust our opinion?

Our content follows strict guidelines for editorial accuracy and integrity. Learn about our and how we make money.

A life insurance policy is an essential part of financial security. However, it doesn't often pop up in dinner conversation because nobody wants to handle it. Why? Well, it's annoying, depressing, and confusing.

However, as soon as somebody depends on you for financial support, maybe a spouse or a child, having life insurance makes economic sense. Why wait? Life insurance is more affordable when you're still young, productive, and healthy.

Let's have a look at how you can go about buying life insurance.

There are three basic methods of buying life insurance. These include:

Directly from an Insurance Company

Purchasing life insurance directly from the company can save you some money. For one, you don't have to pay fees and commissions for agents. And the process is quite straight forward.

However, you have to spend some time going through underwriting guidelines. If there's a different product that suits your needs, you might not learn about it. You may also find yourself repeating the same processes, as mistakes are likely to occur during the application process.

Through an Independent Local Insurance Agent

Life insurance pricing is quite complicated. That's why you should always consider buying from a local independent agent. Local agents will reduce the amount of paperwork you have to do as well as guide you through various options, though you may have more travel time and in-person meetings than with other options. 

Via an Independent Online Broker

Making online purchases adds speed and convenience to shopping for any product. You can run through various insurance companies and compare their policies and premiums. Once you find the kind of insurance you want, you can contact an online agent. This option will cost you less time and money when compared to the previous methods. Online brokers like PolicyScout are required by law to be licensed to sell insurance in your state, so you can trust their knowledge of the law and products available.

What Kind of Life Insurance to Buy

There are two types of life insurance policies, complex and simple. Complex type life insurance includes a variety of investment and retirement products wrapped into a life insurance policy. Such options include permanent life, whole life, and universal coverage.

You've probably seen ads for such on TV; they are the type that promises cash value on your premiums. For most people, this type of coverage isn't the smartest financial move. While there are some tax benefits and investment options that make these a good option for certain high-income people, for most people, the difference in premium between these and simple policies is better invested in other financial products.

The other, and more common type of coverage is term life insurance (and similar products). This option offers affordable solutions, and it's as simple to understand as auto or homeowner's insurance. Once you pay the premiums for the first year, you're covered. Your dependents receive death benefits upon your passing. Besides, you stop paying premiums when the policy expires. There are policies available for many situations, even higher-risk applicants like single parents and pregnant women.

Where to Get Online Life Insurance Quotes

Shopping for life insurance can get tiring. Luckily, you don't have to call an agent to get a quote. These days, insurance companies have brought their services online, making it easier to get an accurate quote.

The best thing about such online services is that it's quicker, and you can get a quote from wherever you are. You also don't have to deal with those aggressive life insurance salespeople that often want to upsell you on things you don't need.

However, some of these websites may still call you, so you should vet them to find out which ones don't have such behavior. 

Here at PolicyScout, we can give you a quick, easy, and free quote today – no hassle. 

Information You Need to Get Your Quote

You don't need any specific document to get a quote. But, you'll need to be familiar with your medical history or the results of recent physical exams. Here are a few steps involved:

Filling a brief form about yourself: Expect to fill in a form with things like your weight, age, gender, or if you smoke. Smoking is the most determining factor; it could double your premiums. You might also have to give your contact information before receiving a quote.

Selecting how much insurance you need: It's common to buy life insurance that's sufficient to replace your after-tax income until your child's 18th birthday. It would help if you also had a policy that can replace your income in the event of your death so that your family can remain comfortable. If you feel unsure, we have a quick guide on how to determine your coverage needs (step 5).

Settling on how much you'll pay: Most of the figures you'll see are convective estimates. The more detailed information you provide upfront, the more accurate your quote. 

Find out your preferred class: Insurers use a broad range of metrics like family history, smoking status, and age to determine your risk class.

How to Apply for a Life Insurance Policy

 Once you find a favorable quote, it's time to apply for the life insurance policy. This process may take weeks, and you should expect to answer many personal questions, undergo medical examinations, and fill in some paperwork.

So, what happens after you apply?

  1. Application verification:

     You will speak to an agent on the phone to verify all the information you provided online. Then the agent will give you some documents to sign and submit to the insurer.

  2. Scheduling a Medical exam:

     The insurer will require a medical exam. They usually contract paramedic professionals like nurses to perform these exams. So, expect one to contact you to schedule the exam.

  3. The exam and long wait:

     The medical examiner will take an in-depth look at your medical history and confirm the info in your application. They'll also check your blood pressure and take samples that will be sent to the lab for further testing. You will receive the results via mail.

The insurer will go through the results to determine how much you should pay. This process may take a few weeks.

What to Expect After You Apply

Once your policy is approved, you will receive a notification and a complete copy of the policy. The insurer will also ask for the first deposit on your premium.

In some cases, insurance companies allow you to make the first deposit before the medical exam. Such a measure binds your policy once you submit your application. Please note that the insurer has the right to raise your premiums or cancel your policy if the medical exam reveals any previously undisclosed medical conditions. So, honesty is paramount. 

Don't cancel your old policy just yet! First, ask when the policy will take effect. You will receive a hard copy of the policy from the agent. Ensure to make a copy and keep the original in a different place. And, don't forget to tell your spouse where they can find the document.

Finally, you can rest easy as you've just made one of the soundest financial decisions in life.

It's that simple! Although it seems like such a drag, buying life insurance is easier than most people think. The only hassle to it is scheduling your medical exam and waiting for the results.

In summary 

These days it's easy to buy life insurance. Among all the options, term life insurance will give you fewer headaches. Also, when looking for life insurance online, our experts like will help you demystify life insurance policies.