All too often, a life insurance company is selected based on the competitiveness of its quote. Sure, price is an important factor, but it shouldn’t be the only reason for selecting an insurer. When it comes to selecting a stable and reputable life insurance company, there are a few things to consider to help ensure that your trust is well-placed.
1. Check the company’s financial rating.
Life insurance is a product that promises to provide financial protection for the people you love after you’re gone. The last thing you want is to pay premiums for years, and then, when your family needs it the most, the insurer can’t keep its promise. One way to check out the financial strength of an insurance company is by looking at its ratings. An insurance company’s credit rating indicates its ability to pay policyholders’ claims and to honor any guarantees provided by the contract. The rating is not an assessment or recommendation of specific products, policy provisions, premium rates, performance of the products, or to the practices of the insurance company. Four independent agencies that rate the financial strength of insurance companies are A.M. Best, Fitch, Moody’s, and Standard & Poor’s.
Good to know tip: You have the right to know the financial stability of the life insurance company before placing your trust in it. In addition to their current ratings, look at a company’s rating history (watch for things like big changes from year to year) and their posted financial statements (look for continuity and profitability).
2. Conduct company research.
Life insurance companies are regulated by the Department of Insurance (DOI) for each state they do business in. DOIs are responsible for many things, including tracking complaints filed by consumers. DOIs allow consumers to research information on insurance companies, agents, financial service providers, and brokers to look for recent complaints and, more importantly, to see how any complaints were resolved. You can also check on whether a company or individual is licensed in the state.
Good to know tip: Each state has its own department or bureau of insurance that allows you to conduct an online search by company and by the type of complaints filed by consumers. The National Association of Insurance Commissioners offers searches on administrative orders to see which regulatory actions (if any) the department in your state has taken against financial professionals or life insurance companies.
3. Get to know the company’s history.
How established is the life insurance company you are considering? Have they been around for a few years or several decades? Life insurance is important coverage and a long-term financial commitment. When a company has stood the test of time, it speaks volumes about their financial stability and their legacy of serving policyholders.
Good to know tip: Companies that are proud of their longevity and financial commitment to policyholders often display company history on their websites, as well as sharing their mission, vision, and values.
4. Interested in a company? Get online and have a look around!
These are just a few aspects to consider when shopping for a life insurance company.
Interested in covering funeral costs and more with final expense whole life insurance? Visit peaceassured.com today to get a fast, no-obligation quote, or call 866-353-8995 to talk with one of our non-commissioned licensed life insurance agents.