Choosing a Life Insurance Company
What to Consider When Choosing a Life Insurance Company
How do I choose the right life insurance company?
If you’re shopping for life insurance coverage you may want
to consider several tips when it comes to choosing the right company for your
We all want to make sure the insurance company we choose
will still be in business when we pass away, so they will be able to pay the
life insurance policy death benefit to our loved ones.
That’s why the financial strength of your insurance carrier
is one of the most important things to consider when selecting a life insurance
When choosing a company for life insurance you may want to
consider the following:
- Financial Strength – What is the A.M. Best financial
strength rating of the insurer? The financial strength rating of an insurance carrier is an
indication of the insurer’s ability to pay their life insurance claims and meet
their financial obligations.The higher the rating, the more financially secure the
insurance company. The highest rating for life insurers offered by AM Best is "A++" Superior.There are several independent rating agencies that review
the financials of insurance companies and issue ratings. Some of the leading independent rating agencies include A.M.
Best Company, Moody’s, Dunn & Bradstreet, and Standard & Poor’s.Choosing a life insurance company with a rating of at least "A" Excellent by AM Best may be a good rule of thumb for selecting a
financially secure insurer.
- Pricing – Compare life insurance rates from several carriers
to help you find the most affordable plan from a highly-rated insurer. When you
compare rates online you’ll receive the price comparisons from multiple
companies and these quotes will show you the financial ratings of the
- Types of Policies – Make sure the company offers both term
life insurance and permanent life insurance. That way, you can compare plans
and pricing for short and long term life insurance coverage.
- Customer Service – Does the insurer have a good reputation
for customer service? Do they provide 24/7 customer service?
- Claims Handling – Does the insurance company have a good
reputation for paying out life insurance claims in a timely manner?
- Complaints – Does the insurance carrier have any complaints
filed against it with the Department of insurance in your state?
- Total Assets and Liabilities – A life insurance company with
a low ratio of assets to liabilities may not be as financially secure as other
- Number of Life Insurance Policies – What is the number of
individual life insurance policies issued by the insurer in the past few years?
Do they have millions of policyholders or thousands?
- Ranking – Is the carrier ranked in the top 50 or 100 of all
life insurance companies in America?
- How Long in Business – In what year was the life insurance
carrier established? The longer in business the more experience.
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Choosing a Life Insurance Company
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