Whole Life Insurance Comparison

Shopping for life insurance is the last thing that you want to do, but it is an important task when you are planning for your future. If you have been comparing various type of life insurance plans and you have decided that whole life insurance is best to suit your personal needs, the next step in the process will be to do a whole life insurance comparison.

Whole life, also called traditional or ordinary life, is a permanent type of insurance that stays in force the rest of the named insured’s life, but some companies offer special features that you should be aware of before you commit to any type of plan.

Not only should you research the features and riders available to you when you purchase a whole life plan, you should also research the carrier that is providing you with coverage that could last as 20, 30, 40, 50 maybe even 60 years.

You will be building a very long-term relationship with the provider that you choose, and knowing that the provider that you chose has a good reputation in the marketplace is imperative when you buy a permanent life insurance product.

If you are not sure how to compare one whole life product to another, read this guide to whole life insurance comparison shopping and learn the step-by-step process of qualifying a product and then qualifying an insurer that will ultimately pay the death benefit.

Once you finish this straightforward guide, you can start to compare policies and then pricing. Use our FREE comparison tool above now!

How does the typical whole life insurance plan work?

The thing that differentiates a permanent life insurance plan from a term life insurance is the cash value feature.

When you buy traditional whole life, the cash value is what essentially helps to pay for the premiums as they rise when you get older.

This traditional type of product has a term life insurance feature and also another savings type of component built into it.

A whole life product offers you a guaranteed death benefit for the whole life of the policy and you will also pay level premiums.

Many people choose this cash value plan over alternatives because it is the only one that is predictable over time. It is also the only product that will give you a guaranteed rate of return.

Another great feature that is included in all whole life plans is the opportunity to earn dividends to essentially maximize your death benefit. After the second year that your policy is in place, the company may pay dividends into your cash account if the investments are performing well.

These dividends are not guaranteed, but they can be accessed while you are living or left to sit and accumulate interest in the cash account if you want a larger benefit over time.

The cash accounts in whole life plans should not be touched unless it is a last resort because it can affect how the premiums are paid by the cash account as the cost for pure life insurance goes up.

This is why it is best to choose an insurer that is known to offer high dividends on an annual basis if you plan on accessing the cash account as a living benefit.

What type of features should you look for when buying whole life?

The traditional structure of a whole life insurance product may not change, but there are special features that can provide you with additional protection if you are unable to pay your premiums or a member of your family is not able to qualify for coverage later in life.

By knowing what types of riders and terms to look for, you can avoid buying a plan that does not provide you with the added protection that you can benefit from.

Here are some of the riders that you should see if the carrier will offer as a standard feature of the plan or for an added premium:

Waiver of Premium Rider

If you become disabled and you are not able to make your normal income, it may be difficult to cover the cost of your insurance premiums. A waiver of premium rider will waive the policy premiums if you are totally disabled and not able to work. This waiver will generally expire when you reach 60 or 65.

Guaranteed Insurability Rider

You have to qualify to buy life insurance, especially if you are buying a permanent plan. Just because you are in good health when you apply does not mean that you will always be in good health.

If you are diagnosed with a medical condition, you may not be eligible to buy more coverage or a separate plan.

Luckily, when you purchase the guaranteed insurability rider, you can buy additional coverage at certain anniversaries.

This means that you may be able to increase your death benefit by $50,000 even if you have cancer, diabetes or other conditions that can lead to a denial.

Disability Income Rider

Some plans may offer you disability income payments when you are diagnosed with a critical illness or disablement. This can help you pay for living expenses and medical care expenses while you are living so that your family does not carry the financial burden.

Additional Term Life Insurance Rider

Permanent insurance can be expensive when you have large financial obligations life a mortgage or other debt. If you cannot afford a large whole life plan, there is a rider that will allow you to purchase additional term life coverage for a specified time period so that you have more protection while the burdens exist. You also do not have to do a medical exam to get this added protection.

Accelerated Death Benefit or Critical Illness Rider

If have been diagnosed of a critical illness and your life expectancy is one year or less, this rider allows you to use a portion of your death benefit while you are living. This rider is usually free from companies that believe in offering this rider for protection when the named insured is critically ill.

Child or Spousal Riders

If your spouse or child does not have their own plan or cannot qualify, you may be able to add them to your plan for a small amount of cover. This is beneficial if you do not want to apply for a separate plan or go through separate underwriting.

The only drawback is that your child’s cover or spouse’s cover will expire when you pass away or when your policy cancels.

How to Find the Best Whole Life Provider

You will need to take the time to find an insurer that offers the riders and features that you want, but you also need to consider the reputation of the carrier in the marketplace.

Some insurers offer strictly term life, some carriers offer permanent life, and others offer all types of lines of life insurance.

The carriers will be priced to offer specific types of products to specific niches, and you need to find the company that will offer you affordable permanent life premiums and still offer you a quality product. Here are some characteristics to look for when you are comparing carriers:

Financial Stability

The most important factor to consider when you are doing company comparisons is financial stability and strength. A company needs to be strong to be able to pay out all of the claims that are filed for death benefits.

The strength of the company will depend on how long they have been in business, how much experience they have with whole life, and the investment moves that they make with their portfolio. You can check the financial rankings through consumer agencies like A.M. Best, which ranks all financial companies.

Marketplace Investing

The only way an insurer can pay out death claims for a whole life plan when the premiums collected do not equal up to the death benefit is by making smart investments.

This is also how the insurer can pay their policyholders dividends that help to increase the benefit on the plan.

Make sure that you find out how stocks and bonds are invested and the success trends of the insurer.

Customer Service

You may need to contact your insurer to make payments or to make changes to your plan while you are living. If you need to contact the insurer, you want to get quick, easy and quality service.

Check complaint databases and customer satisfaction records to narrow down your list.

Now that you know how to do a whole life insurance comparison, now is the time to get started. You can sift through your list and then compare pricing quickly by using an online rate comparison tool.

By using this advanced tool, you can access one source to price the cost of coverage through all of the top-rated insurers in the industry offering whole life cover.

Use the FREE tool below to start comparing quotes instantly!