How to Compare Life Insurance Quotes

Online quote tools make it easy to shop a monthly number and stop there. That number is only a starting point. Two quotes that look far apart may be for different term lengths, different riders, or different assumed health classes. Two quotes that look identical may hide a conversion privilege on one policy and none on the other. A fair comparison holds the important parts constant, then looks at what happens after underwriting — because the issued premium can differ from the illustrated one.

This is general information, not a recommendation, and not a rate quote. Premiums vary by age, health, and the amount of coverage. The insurer, not a website, makes the underwriting decision. For product background, see term versus whole life versus IUL, how to choose a term length, and life insurance riders explained.

Hold these parts equal before you compare price

• Death benefit. Same face amount, not “about the same.”
• Term or structure. A 20-year level term is not a 30-year term, and neither is a decreasing term or a permanent policy. See decreasing term versus level term.
• Riders. Waiver of premium, child coverage, or accidental death on only one quote will change the price and the benefit.
• Assumed health class. A preferred-plus illustration next to a standard illustration is not a comparison. Be honest about health, tobacco, and driving history so the class is in the same neighborhood.
• Who owns the policy. Individual coverage you own is not the same as group life that may end with a job. See group versus individual.

If you are comparing permanent products, also hold the payment pattern and the guarantees constant, and read illustrations with the same care described in how to read an IUL illustration. Illustrated values that are not guaranteed do not belong in a “cheapest premium” contest.

Look past the first monthly number

Ask whether the quote is a guaranteed level premium for the full term, or whether it can change. Ask about the conversion privilege: can you convert to a permanent policy later, until when, and to which products? A convertible term policy can be worth more than a slightly cheaper term with no conversion if your health may change. See can you convert term life to permanent.

Ask how underwriting will actually be done — a medical exam, an accelerated program with no exam, or a mix. A lower quoted class that you are unlikely to receive is not a bargain. See what to expect at a life insurance medical exam and life insurance without a medical exam.

Financial strength of the insurer, complaint history, and the exact contract language also belong in the comparison. The National Association of Insurance Commissioners (NAIC) provides consumer material, and you can verify that the person offering the policy is licensed in Missouri. See how to verify a Missouri insurance license. Do not treat a brand name, or the absence of one in this article, as a substitute for that check.

Return-of-premium term will usually cost more than a comparable term policy that does not return premiums. Compare the extra cost with what you would do with the difference, not only with the idea of “getting money back.” See return-of-premium term.

After you apply, the quote can still change

Underwriting can confirm the quoted class, issue a different class, reduce the amount, add a flat extra, postpone, or decline. That is normal. The useful habit is to apply with truthful information, keep existing needed coverage in force until a new policy is issued, and read the issued contract before you drop anything. If two applications are outstanding, disclose that, because financial underwriting looks at total coverage. See more than one policy.

A licensed insurance broker can place the same amount and term with more than one insurer and show you the issued offers side by side, including what each contract does if you later want to convert or if you miss a premium. See what happens if you miss a premium. You can also start with a coverage calculator so the amount you are quoting is tied to a need, not to a round number that looked good in a form.

A simple side-by-side you can actually use

Write five columns: amount, term, riders, assumed class, and monthly premium. Add a sixth for notes — conversion end date, exam or no exam, and anything the quote assumed that might not be true. If a line in one column is blank, the comparison is not finished. When an issued offer comes back at a different class, update the sheet rather than keeping the original illustration as if it were the policy.

If you live in the St. Louis area, you can also start from a need-based amount rather than a round shopping number. See how much life insurance do I need in St. Louis and the life insurance calculator. A licensed insurance broker at Emerson Financial Group can then compare equal illustrations without mixing term lengths or rider sets.

The bottom line

Compare life insurance quotes only when the amount, term, riders, and assumed class are the same. Then look at conversion, underwriting path, and the issued contract — because the first monthly number is an estimate. The cheapest illustrated premium is not always the policy that will actually be in force at the price you expected. A licensed insurance broker can help you hold the variables still and read what is left.

Sources: NAIC, Life Insurance · Missouri Department of Commerce and Insurance

Frequently asked questions

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This article is general and educational, not an offer to sell insurance or financial, tax, or legal advice. Coverage, benefits, and availability vary by carrier, product, and state, and all coverage is subject to underwriting.