The underwriting process in life insurance will classify you in a particular rate class. A rate class is the price you have to pay for life insurance coverage, commonly known as premiums. Life insurance companies scrutinize your application, and look closely into the outcome of your physical exam, as well as into other supporting documents such as criminal offences, medical history, driving history, etc. Then taking your age and sex into consideration it brackets you into a certain rate class. Different life insurance companies have different names for their rate classes. However, the commonly used terms are Preferred Plus (the best rate only awarded to someone in excellent health, with no bad habits), Preferred, Standard and Substandard (for someone who has serious health conditions). Life insurance rates are cheapest for the Preferred Plus rate class, and increase for each lower rate class. That’s why qualifying for a better rate class can save you a lot of money.

Tips for qualifying for a better rate class
If you think you are too entrenched in a bad habit, and there is no hope, do not despair. Even minor changes can improve your rate class and give you a go at cheaper premiums. The following tips will tell you more.

• Lose the pounds. Even if you don’t have health problems but are overweight, you won’t qualify for the best rate class because weight gain is associated with medical conditions such as higher cholesterol levels and heart ailments. You should know that life insurance companies use a weight table to determine the height to weight ratio. If you are even a few kilos overweight it may affect your chances of qualifying for the best rate class. If you are an overweight woman, apply to a life insurance agency that uses a unisex weight table so that you can take advantage of men’s higher weight averages to qualify for a better rate class. Talk to your doctor for help in reaching your ideal weight. Also, if you have lost weight since you purchased a life insurance policy, ask for a review so that you can qualify for a lower rate class.
• Health conditions. Sometimes, when a condition such as diabetes or blood pressure is within check, you do have a chance of qualifying for a better rate. Check with your doctor and include supporting documents to prove that you have kept it in check for long enough.
• Tips for smokers. Whether you have just one cigarette a day, or you are a chain smoker, you will qualify for a separate rate class and will be offered a ‘smoker’s ‘ policy. Tobacco usage is associated with serious health problems such as lung and heart disease, and that’s why if you have these health conditions in addition to being a smoker, you will have to pay sizeable premiums. The good news for tobacco users is that life insurance companies do reward you if you have quit smoking. Depending on the life insurance company you approach, if you can prove that you have been smoke-free from between 1 to 5 years, they will re-evaluate your policy application and offer you lower premiums.
• Are you in a dangerous profession or risky hobby such as scuba diving or bungee jumping? Then you are likely to qualify for a higher premium. However, if you can show that you are certified and have taken safety classes, you might be able to get a better rate.
• Practice responsible driving: As underwriters see it, if you are flouting road rules, you are also most likely to be involved/ be the cause of serious road accidents. If you had a traffic violation or a DUI conviction in the recent past, you won’t qualify for the best life insurance rates.
• Are you credit worthy? If you have filed for bankruptcy in the recent past, it could adversely affect your chances of qualifying for lower premiums.

Why you should buy from a multi carrier life insurance provider
As mentioned earlier in this article, different life insurance companies have different standards on which their underwriting process is based. If you buy life insurance from a local agent, or directly from a life-insurance carrier, you won’t really get a chance to know if the life insurance quotes offered to you are from the carriers who could be partial to your particular requirements. On the other hand multi-carrier agency websites deal with hundreds of life insurance companies, and their automated quote-matching service will be able to pick up policies from life insurance carriers that look more favorably on your application than others. Best of all, their quotes reflect the best rates (for your particular requirement) and can be quite accurate.

Many people lie on their life insurance applications. Remember, that if your lie is found out, you may never ever qualify for life insurance. The better way out is to change one’s bad habits, and then apply for life insurance. Lifestyle and health changes can really save you a fortune on your life insurance premiums.

Your family should not suffer because you have been careless with your health and lifestyle choices. Always focus on the real reason why you want life insurance. They will thank you for it.

About AccuQuote:
AccuQuote is a leader in providing term life quotes to people across the United States. In 1986 it began operating with a single goal: to make the process of buying term life insurance as easy as possible for its customers. Their experienced professionals consistently deliver the most affordable term life insurance rates by comparing thousands of life insurance policies from dozens of top-rated carriers.

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Permanent life explained

Permanent life insurance will remain in effect until the insured dies, after which the death benefits will be paid out to the beneficiaries. The premiums on permanent life are designed to remain equal throughout the life of the insured. Premiums are high because permanent life policies develop cash values that can be accessed by the insured through surrenders or through loans against the policy.

The cash values in permanent life insurance policies typically include two components:

• A guaranteed cash value, already referred to above. The cash value grows based on a pre-set schedule, and grows to a sizeable amount upon maturity of the policy (typically at age 100).
• Most permanent life insurance policies additionally have a non-guaranteed cash value element, typically made up of dividends or earnings on the cash value, which can enhance the value of the life insurance policy over time.

There are many permanent life policies in the market today with varying features and varying degrees of control over the cash value component of premiums.

Permanent life vs term life

In sharp contrast to all the cash-value possibilities that permanent life can offer, term life insurance policies only offer you the death benefit, and only cover you for a particular number of years, called the ‘term’. Because of the absence of cash values and the temporary nature of this policy, term life premiums are more affordable.

Permanent life insurance can be substantially more expensive than term life insurance, but the death benefit is guaranteed as long as premiums are paid. On the other hand term life policies can buy you the same amount of death benefit as a permanent life insurance policy, at a fraction of the premium cost.

The pros and cons of permanent life insurance

The drawbacks of permanent life insurance are:

• With most permanent life insurance policies, you don’t have a say in the investment portfolio to which your cash value component is linked.
• Because of its investment component, the best benefits on a permanent life policy are gained in the long term. So this is not a great life insurance policy for someone who wants a stopgap life insurance policy.
• If you fall short of funds the cash value portion of permanent life policy can be borrowed against. This attracts interest, so it is advisable not to borrow against a permanent life policy unless it’s a last-resort effort to access money during a tough financial situation.
• The investments of most permanent life insurance policies are by nature very conservative (variable permanent life policies are the exception) with a strong possibility that if you were to invest the same amount of money elsewhere, you would earn much more on your investments. In fact there is a school of thought that advocates that permanent life insurance may not be worth the money at all when compared to the benefits of buying term and investing the difference in premiums (between term and permanent).

Let’s move on to the advantages of permanent life.

• If you have difficulty exercising discipline in money matters, permanent life is a great option because it offers you ‘forced savings’. If not for the policy, you probably would have difficulty investing money so consistently into an investment avenue.
• Permanent life is a life-long insurance policy and the premiums are consistently level. Though it can be quite a pinch in the first few decades of your policy, as the years pass, it can get more affordable.
• When you outlive a term life policy, you will need to buy more insurance, predictably at higher premiums. This problem does not arise in permanent life because the policy is lifelong, and premiums are consistently equal.

Is permanent life insurance right for you?

It all boils down to the life insurance needs at your current stage in life. If you are very young and have several financial obligations such as small kids, their college education to think of, mortgages, loans, etc. then permanent life policies may not be right for you just yet because of their high premium costs. Term life would be a lot better. On the other hand, if you are older, and are mostly done with your financial obligations you will need a life insurance policy to cover you for the rest of your life, and that’s where permanent life seems the more feasible choice.

How long do you plan to keep your life insurance policy? If you want to be insured for several decades, you have to think of permanent life and not term, because even though term premiums are low, they will increase each time your policy expires, and you take out a fresh policy.

However, one must also consider the fact that permanent life insurance investments grow conservatively. Therefore, those who are looking at great returns on their investments are better off buying term and investing the difference (that they save on premiums) in tax-deferred investment vehicles like IRAs, Roth IRAs and even educational accounts like the 529s. The general opinion is that if one can make sound investments elsewhere with this savings in premiums, the returns would be much greater returns than a permanent life policy could provide. If you look at it from this angle, permanent life insurance doesn’t really seem worth the money. The choice however, should totally depend on individual considerations.

Finally…

You need to spend some thought on how much your coverage should be. With permanent life especially, you don’t want to be over insured because defaulting on your premiums can cancel your policy. You don’t want to be under insured either, and put your family through tough times. So use an online life insurance needs calculator for an accurate estimate of how much life insurance you will need.

Shop around before you buy your life insurance. You can do this online in a hassle-free manner by getting quotes from a reputed online life insurance agency. Check if the website is BBB-accredited, and you can be assured of its authenticity.

AccuQuote is a leader in providing term insurance quotes to people across the United States. In 1986 it began operating with a single goal: to make the process of buying term life insurance as easy as possible for its customers. Their experienced professionals consistently deliver the low cost life insurance (http://www.accuquote.com/low-cost-life-insurance.cfm) by comparing thousands of life insurance policies from dozens of top-rated carriers.

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The underwriting process in life insurance will classify you in a particular rate class. A rate class is the price you have to pay for life insurance coverage, commonly known as premiums. Life insurance companies scrutinize your application, and look closely into the outcome of your physical exam, as well as into other supporting documents such as criminal offences, medical history, driving history, etc. Then taking your age and sex into consideration it brackets you into a certain rate class. Different life insurance companies have different names for their rate classes. However, the commonly used terms are Preferred Plus (the best rate only awarded to someone in excellent health, with no bad habits), Preferred, Standard and Substandard (for someone who has serious health conditions). Life insurance rates are cheapest for the Preferred Plus rate class, and increase for each lower rate class. That’s why qualifying for a better rate class can save you a lot of money.

Tips for qualifying for a better rate class
If you think you are too entrenched in a bad habit, and there is no hope, do not despair. Even minor changes can improve your rate class and give you a go at cheaper premiums. The following tips will tell you more.

• Lose the pounds. Even if you don’t have health problems but are overweight, you won’t qualify for the best rate class because weight gain is associated with medical conditions such as higher cholesterol levels and heart ailments. You should know that life insurance companies use a weight table to determine the height to weight ratio. If you are even a few kilos overweight it may affect your chances of qualifying for the best rate class. If you are an overweight woman, apply to a life insurance agency that uses a unisex weight table so that you can take advantage of men’s higher weight averages to qualify for a better rate class. Talk to your doctor for help in reaching your ideal weight. Also, if you have lost weight since you purchased a life insurance policy, ask for a review so that you can qualify for a lower rate class.
• Health conditions. Sometimes, when a condition such as diabetes or blood pressure is within check, you do have a chance of qualifying for a better rate. Check with your doctor and include supporting documents to prove that you have kept it in check for long enough.
• Tips for smokers. Whether you have just one cigarette a day, or you are a chain smoker, you will qualify for a separate rate class and will be offered a ‘smoker’s ‘ policy. Tobacco usage is associated with serious health problems such as lung and heart disease, and that’s why if you have these health conditions in addition to being a smoker, you will have to pay sizeable premiums. The good news for tobacco users is that life insurance companies do reward you if you have quit smoking. Depending on the life insurance company you approach, if you can prove that you have been smoke-free from between 1 to 5 years, they will re-evaluate your policy application and offer you lower premiums.
• Are you in a dangerous profession or risky hobby such as scuba diving or bungee jumping? Then you are likely to qualify for a higher premium. However, if you can show that you are certified and have taken safety classes, you might be able to get a better rate.
• Practice responsible driving: As underwriters see it, if you are flouting road rules, you are also most likely to be involved/ be the cause of serious road accidents. If you had a traffic violation or a DUI conviction in the recent past, you won’t qualify for the best life insurance rates.
• Are you credit worthy? If you have filed for bankruptcy in the recent past, it could adversely affect your chances of qualifying for lower premiums.

Why you should buy from a multi carrier life insurance provider
As mentioned earlier in this article, different life insurance companies have different standards on which their underwriting process is based. If you buy life insurance from a local agent, or directly from a life-insurance carrier, you won’t really get a chance to know if the life insurance quotes offered to you are from the carriers who could be partial to your particular requirements. On the other hand multi-carrier agency websites deal with hundreds of life insurance companies, and their automated quote-matching service will be able to pick up policies from life insurance carriers that look more favorably on your application than others. Best of all, their quotes reflect the best rates (for your particular requirement) and can be quite accurate.

Many people lie on their life insurance applications. Remember, that if your lie is found out, you may never ever qualify for life insurance. The better way out is to change one’s bad habits, and then apply for life insurance. Lifestyle and health changes can really save you a fortune on your life insurance premiums.

Your family should not suffer because you have been careless with your health and lifestyle choices. Always focus on the real reason why you want life insurance. They will thank you for it.

About AccuQuote:
AccuQuote is a leader in providing term life quotes to people across the United States. In 1986 it began operating with a single goal: to make the process of buying term life insurance as easy as possible for its customers. Their experienced professionals consistently deliver the most affordable term life insurance rates by comparing thousands of life insurance policies from dozens of top-rated carriers.

There are no posts related to Changing Bad Habits Can Save You A Fortune On Life Insurance.

Advantages of Guaranteed Acceptance Life Insurance

The main obvious advantage as we have already discussed is that you can’t be turned down for an application due to health or lifestyle issues.  With other policies you may have to answer some health questions and/or have a medical exam as part of the application process.  With the guaranteed acceptance policy, there are no questions asked, as long as you pay the premium costs you are covered, and the company does not have the right to cancel the policy. This means your policy will stay the same rate even as you get older.

Disadvantages of Guaranteed Acceptance Life Insurance

One of the biggest disadvantages to buying a guaranteed acceptance policy is that the premiums you have to pay tend to be considerably higher compared with other types of life insurance. This is because by accepting everyone who applies, the company is taking a bigger financial risk and could end up paying out more in claims than a company who only insures lower risk customers.

Another substantial disadvantage is the payout amounts, which often fall significantly short of payouts you would expect from other life insurance policies. There is usually a maximum payout amount of around $15,000 – $20,000, and many policies only offer enough to cover funeral expenses. Even with the maximum payout, it is unlikely this will replace the insured persons income for a number of years or pay off the mortgage. It is vital to find out the total cost of the premiums you will be paying before you opt for this type of life insurance as some polices may lead you to pay out more than your beneficiaries would receive.

Although this policy is describes as ‘guaranteed acceptance’ this is sometimes misleading, as for most policies of this kind there is often an age restriction, generally from 50 – 85. This isn’t generally too much of an issue as it is this age group that typically has the most difficulties in getting regular life insurance.

Many polices of this type also have what is called ‘graded benefits’ during the first couple of years. For example if the insured dies within the first year the beneficiaries may only receive a refund of the premiums paid plus only 5/10% of the interest. This method is used so insurance companies are protected from people who are close to death buying policies when they wont be paying into the plan for at least a few years. There are some plans however that will pay the full death benefit in the first couple of years if the death was accidental.

As you can see there are many more disadvantages to this type of policy than advantages and it is only ever used as a last resort if you cant get any other type of policy due to poor health, age or circumstances. If you are in this position it can be a sensible option as long as you make sure you are getting a good deal. The best way to do this is to go on a comparison website, of which there are many, where you will be asked to only enter in your name, address, and beneficiary. You can then get quotes and compare them for the best rate for you. Make sure you read all the policy terms and conditions before you commit to buying a policy.

To learn more about life insurance click here where you will also find valuable information on rates, other types of life insurance, life assurance, and much more.

To find money saving tips for life insurance click here

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