When comparing low cost life insurance in the state of Connecticut, there are a few rules you should follow:
1. Compare term to term and whole life to whole life: There are marked differences between term and whole life policies. To compare pricing of a term policy against whole life policy will do you a disservice. They are as different from each other as renting an apartment is from purchasing a house. Here’s a brief overview of each policy:
a. Term Life: Term policies are written for a specific period of time (anywhere from 1 to 30 years). The policy remains in force until either the policy expires or the death of the insured. If the policy term expires prior to the death of the insured, there is no return in premium (similar to renting an apartment). Term policies are generally the cheaper of the life insurance policies.
b. Whole Life: Whole life polices terminate upon the death of the insured. In addition to providing death benefits, they are also used as an investment option (like purchasing a house). The various options available when purchasing whole life insurance polices tend to make them more expensive than their term counterpart.
2. Make sure the company is financially stable: Company’s with low financial stability ratings may charge lower premiums, but the last thing your beneficiaries need is to have a company unable to pay the death benefit. Have your agent has several ways to check financial stability. They can use either A.M. Best, Fitch, Moody’s or Weiss Ratings. Each of these companies rate the financial stability of insurance companies.
3. Analyze: When it comes to comparing low cost life insurance policies, it is best to sit with a paper and pen and write down the various options and clauses. Once you’ve gone through each policy’s terms and conditions, you will be able to make an informed decision. You may find that price isn’t the only determining factor.