Life Insurance Made Easy

Free life insurance quotes available online are changing the face of the insurance sector. And for once, things have changed for the better.And things are changing rapidly. As with any other business, the Internet has come in, the whole mode of insurance business.

Previous Scenario

In the days before the Internet, buying life insurance was difficult. And that is to put it mildly. However, to be exact buying an insurance policy wasn't that much of a problem; the problem was you never get the one you needed.

The whole process started with you seeing an ad on TV or in the newspaper. You wrote down the number to call. Once you call you are connected to an insurance agent. You now had to fix an appointment meet the agent and learn about the policies available. He of course had limited choices to offer you. And most of them would not suit you. So you were left with a maximum of two to three policies to choose from, if you were lucky.

Present Scenario

Enter the World Wide Web and things change. Now there are hundreds of sites which are ready to offer you free life insurance quotes. They vary in the kind of quotes they offer and the number of quotes they have. But there are plenty of good ones.

And then there are the companies which have put up their own website to provide information about the policies they have. They also offer you the ability to select the policy online and purchase the Internet too.

Now how do these websites which offer you free life insurance quotes make money? Well the idea is simple. But it works great. Once you enter the website you will be asked to fill out a form to provide your name and contact details. Once you have completed the form, you are ready to access hundreds off free life insurance quotes absolutely free. What these websites do is to provide your contact information to insurance agents for a fee. They also tell the insurance agent about the kind of insurance you are looking for, thus helping them to market their policies better.

So all it takes to access free life insurance quotes is a computer and an Internet connection.

Permanent Life Insurance

For many of us the thought of having a life insurance policy is not a pleasant one. To get life insurance for yourself is in a way to accept that you are going to die one day. And however much truth that does contain, it is always hard to accept such a fact. But at the same time none of us would want to see us our family landing up in acute financial distress after we pass away. Nor would someone like to see his long-term business partner face a severe financial crunch because his business partners untimely death. Getting a permanent life insurance policy solves such problems.

What is Permanent Life Insurance?

Permanent life insurance gives coverage in the event of your death. The insurance is valid as long as you live and you pay your premiums. It never runs out of term. Another great thing about permanent life insurance is you get to pay the same premium all your life. No matter if there has been a war or the economy is going through severe depression, you will have to pay only the amount that you and the insurance company had agreed upon at the beginning of the agreement. What this means is that with a permanent life insurance in place you can think about planning other aspects of your future.

Benefits of Permanent Life Insurnace

Apart from insuring you for your whole life, permanent life insurance also offers you several benefits. We list a few benefits below.

1. Protection from mortgage: In case you have had a mortgage the money from your policy can be used to pay off the mortgage. Similarly any other debts you may have can be paid from the life insurance money.
2. Funding after retirement: Once you retire and you feel you can do with a few extra dollars you can obviously access your cash values. But that would mean that the value of your death benefit will get decreased.
3. Funding charities: It might always have been there in the back of your mind to help a charitable organization. But probably you believed you never had enough money to make a significant contribution. Well, here is your chance. You can assign a certain part of your permanent life insurance to a charitable organization.

If the company with which you have your insurance has had a very successful business year its board of directors might consider providing a dividend to all its consumers. This however is not guaranteed. But if you are lucky you can get dividends against your permanent life insurance. This dividend you can take in the form of cash, use it to buy a new policy, or you can use the dividend to lower the premium you pay.

Another advantage of permanent life insurance is that the money your beneficiaries receive is usually free from federal income tax. So you will at least have the comfort that you are not paying taxes even after your death. Some consolation.

Life Insurance Terms

Your Life Insurance Glossary

Here are a few common terms you'll want to be familiar with when you shop for permanent or term life insurance coverage:

Beneficiary: A person other than a participant who may become eligible to receive, or is receiving, benefits under an insurance policy.

Cash surrender value: The amount payable to an insured who surrenders cash value life insurance, which terminates all insurance benefits.

Convertible term life insurance: A plan that permits you to exchange the term life insurance policy for a permanent one at some point.

Free look period: Under the laws of some states, a period typically at least 10 days) during which time you may cancel the policy without penalty.

Insurable interest: A requirement that if you want to buy a life insurance policy on someone else's life, you must have an interest in that person remaining alive or expect emotional or financial loss from that person's death.

No-load policy: A type of policy that some insurers sell directly to consumers without having to pay commissions to agents and brokers.

Permanent cash value) life insurance: A type of life insurance that combines a death benefit with a cash value component that builds over time; offers lifetime protection.

Risk factors: Factors that the insurance company takes into consideration when calculating your premium for permanent or term life insurance; these include your age, your health, whether you use tobacco, your family health history, and the type and amount of life insurance you're buying.

Term life insurance: A type of life insurance that provides coverage for a specified period of time--generally one, 10, 20, or 30 years, or until the insured reaches 65 or 70 years of age.
Find out more about Term Life Insurance.

Universal life insurance: A type of permanent life insurance in which the cash value varies with the purchaser's payments and the insurer's investment returns.
Find out more about Universal Life Insurance.

Variable life insurance: A type of permanent life insurance in which the cash value fluctuates depending on the investments purchased by the purchaser for his or her portfolio.
Find out more about Variable Universal Life Insurance.

Whole life insurance: A type of permanent life insurance. Whole, universal, and variable life insurance each has their own provisions, but all cover you for the remainder of your life.

Life Insurance Beneficiary Q & A

Choosing a life insurance beneficiary is one of the most important aspects of putting together a policy, and potentially one of the most confusing. In fact, the topic of beneficiaries raises a host of interesting, and sometimes eyebrow raising, questions from consumers. Here is a list of frequently asked questions on the subject, ranging from the practical to the cinematic, along with some simple, straightforward answers to get you in-the-know.

• Can a Beneficiary Kill Someone and Collect on the Life Insurance? --Whether you're watching 1944's Double Indemnity, or 1994's The Last Seduction, movie and TV plots about disgruntled wives who knock off their husbands (or vice versa) for the life insurance money have been a staple in Hollywood ever since the invention of "talkies." But is it possible? Only if you don't get caught. Under U.S. common law you can't collect on insurance if you "feloniously or intentionally" kill someone, and more than half of the 50 states have specific statutes that prevent murderers from collecting on life insurance benefits tied to their victims. Surprisingly, you can kill yourself and still receive benefits in most states, as long as you've carried the policy for at least 2 years and were not contemplating suicide when you took out the policy.


• Who Should You Name as Your Life Insurance Beneficiary? --The answer to this question is an easy one: whoever you want. Spouses, children, parents, siblings, close friends, universities, and charities are all common life insurance beneficiary designees (or choose a combination if you like). The important thing is to clearly state in your policy who is the beneficiary, and how much each recipient will get if you divide the benefits between multiple parties. Naming secondary and tertiary beneficiaries is also important (see below), and if you designate a minor as a beneficiary, be sure to name a trusted custodian to manage the money until the minor reaches legal age, as well.


• What If No Life Insurance Beneficiary Has Been Named? --According to Gerry W. Beyer, the Governor Preston E. Smith Regents Professor of Law at Texas Tech University, a shocking 60% to 75% of the U.S. population dies without a named beneficiary to receive their life insurance benefit. Known as "dying intestate," this phenomenon is usually the result of the primary beneficiary having passed away, in which case the benefit will revert to the estate of the deceased, and distribution will be determined by your state's specific intestate succession laws. Not comfortable with the state settling your affairs? Naming secondary and tertiary life insurance beneficiaries is an easy solution.


• Can You Insure Someone Else Without Their Knowledge and Name Yourself the Beneficiary? --In a more devious spin on the scenarios posed in question #1, the wife takes out a policy on her husband without him knowing it, and then knocks him off to collect the benefits. In addition to the obstacles noted above, life insurance policies of any significant value are rarely issued without a medical exam of the insured, making this a tough way to strike it rich. That said, there are exceptions in some states for those who rely on another's income to survive (insuring an ex-husband who pays child support, for example), and "confidential life insurance" is available for businesses (e.g. - a bank insuring a client who takes out a significant loan, or a movie studio insuring an actor), though these policies usually exempt blood relatives and spouses.


• Will Your Beneficiary Have to Pay Taxes on Your Life Insurance Benefit? --That depends. If you name your estate as beneficiary and your estate amounts to more than $3.5 million, the government can claim up to 45% of the final amount of your estate in taxes. On the other hand, you can name a spouse as a beneficiary and the government can't take a single penny, even you have a $100 million policy.

On a parting note, the best way to get quality life insurance coverage, and to find answers to all of your pressing life insurance beneficiary questions, is to use an online insurance quote service like NetQuote.com to round up a number of quotes and providers to talk to. Not only will you be able to compare rates, coverages, and services of a handful of providers, but you'll get the opportunity to ask industry professionals the tough questions about life insurance beneficiaries, and life insurance coverage in general, that are unique to your specific life insurance needs.

Major Factors that Determine Your Term Life Insurance Rate

While the economic outlook remains uncertain and unemployment a constant threat to continued financial security, life insurance is making a big comeback. And whether it's an underwater mortgage or skyrocketing health insurance premiums, many individuals recognize the potential risk to their families in the event of a personal has never been higher. Yet, you probably also recognize that you need to find a low term life insurance rate to fit the extra expense into an already tight annual budget. Without any personal information, it's impossible to estimate how much your term life insurance might cost. By taking just a few minutes to fill out NetQuote's short online form, you can generate preliminary quotes for a life insurance policy, but it may also help to take a few minutes to look at the major factors that will determine your individual term life insurance rate.

Two Major Factors for a Term Life Insurance Rate

There are two factors that trump all others when calculating your term life insurance rate: your health status and your policy's death benefit. If you have a health condition that makes you particularly risky to insure--tachycardia with a family history of heart disease, for example--your premiums will be much higher, no matter what other policy choices you make. Some particularly serious health afflictions may make you altogether uninsurable. Likewise, if you want your family to be fully protected by a death benefit of, say, two million dollars, you can expect to pay a higher premium rate, regardless of other discounts.

Other Factors that Determine Your Term Life Insurance Rate

• Long-Term Life Insurance Policies: With most items, the bigger the purchase, the better the rate. With term life insurance, longer-term policies tend to be more expensive for the simple reason that the older you get, the likelier you are to pass away. Longer term life policies can be structured so that higher future rates are accounted for in the beginning, allowing a consistent insurance premium, year-in and year-out. Or, they can account for the higher risk, as you go along, requiring that you pay a slighter higher premium with each passing year.


• Convertible Life Insurance Policies: If you're uncertain of your future life insurance needs, but don't want to invest in more expensive whole life insurance, this is a great option for you. Essentially, by paying just peanuts more for your insurance premiums, you can automatically renew your term-life insurance for a longer term or convert it to a whole life insurance policy at some point down the road.


• Life Insurance Medical Exam and Family History: You may be in good health currently, but other warning signs and markers can still lead to somewhat higher prices. If, during the medical exam, you have slightly elevated blood pressure, this can lead to a higher risk profile. Likewise, if you've been even a social smoker over the last three years, you'll have to pay more for life insurance. Many term life insurance policies don't require a medical exam, but these guaranteed issue policies also tend to cost more simply because the company has less certainty when calculating your insurance risk.


• Personal Profile: There are also several items of personal information that will influence your rates. The three most common items are gender, occupation, and location. The reasons are pretty self-explanatory: Women tend to live longer, some jobs are more dangerous than others, and the air in Seattle, WA is a lot cleaner than the air in Pittsburgh, PA.

Online Insurance Quotes and Preliminary Rates

The best way to shop for a term life insurance rate is over the Internet, at least at first. By simply filling out a brief, online form, you can get matched to several companies that fit your insurance needs and will offer you preliminary rates. This method of soliciting rates is an incredibly efficient way to create a starting point for shopping for life insurance. Indeed, it's hard to underestimate the benefit of calmly shopping for insurance from the comfort of your own home. Be aware, however, that the first rates you see are the lowest possible rates given your basic risk profile. Once you begin discussing actual policies, there is an excellent chance you'll want to opt for a few extra guarantees that will cost a little more.

Understanding Guaranteed Life Insurance

If you're considering buying a life insurance policy, you already know why it's beneficial to your family. They can use the money to pay your unpaid debts, medical and funeral costs, or simply to supplement a portion of lost income. The main questions most people have are what kind of policy to buy and how much that will cost. Guaranteed life insurance makes sense for many people, for a number of reasons.

What Is Guaranteed Life Insurance?

The "guaranteed" part sounds great, but what exactly are you buying? Well, guaranteed life insurance is essentially the same thing as whole life insurance. The entire amount will be paid out when you die, and the premiums are guaranteed to stay the same. Your premiums will pay for the insurance and accrue the cash value of the policy, which usually takes about two years. It's also guaranteed to everyone, with just a few exceptions. For someone who's having trouble getting an affordable life insurance policy (or any policy at all), guaranteed life insurance is a great option.

The Advantages of Guaranteed Life Insurance

There are several reasons this type of life insurance policy is advantageous:

• No medical exam: You won't be subject to an exam, or have to share medical history. For someone with a history of illness or a chronic condition, this is a huge benefit.


• Set premiums: Once you enact your policy, your premium will stay the same, regardless of inflation or a new medical condition.


• Full payout: As long as you pay your premium, the full amount will be paid out when you die.


• Ability to borrow: While the exact logistics might differ according to insurance provider, you can generally borrow money from the cash value for emergency expenses.

Some Finer Points

Since it does take about two years for value to accrue, guaranteed life insurance has something called graded benefits. This means the payout is related to the amount of time it takes for value to build. If you have a serious condition that will likely cause you to die in a matter of months, then a guaranteed life insurance policy is highly unlikely to pay full benefits that quickly. And while this is generally a very inclusive type of policy, there are likely age limitations--age 70 and over--from most providers. Finally, in order to guarantee payment, insurers usually set a maximum amount for your benefits. You can probably get up to $50,000 in coverage, but usually not more than that.

How Does the Cost Work?

In order to guarantee payment, insurers generally set premiums higher than term life insurance. You'll know exactly how much you have to pay as long as you live, but that amount might be high. However, a number of insurers offer guaranteed life insurance, which means you can search online for providers and easily compare their quotes. If you use a free service such as NetQuote.com, you can find dozens of offers in no time and compare their premiums side by side. And that's guaranteed, too.

Finding the Right Group Term Life Insurance

By providing benefits for employees, whether health or life insurance, you give them security against terrible accidents and events. You also protect your own business. Numerous studies have shown that companies with better benefit packages attract more talent and are able to retain that talent. From that perspective, group term life insurance is a cost you can likely make up with better productivity. And with online comparisons of dozens of quotes, you'll save money on your group plan from the beginning.

Getting to Know Group Term Life Insurance

Whether you're an employer or the head of the labor union, when you enact a group life insurance plan, you'll be the policyholder for a group of people. Usually you will pay the premium as well, which will be a lump sum payment for the entire group. If you choose group term life insurance, the policy will typically run for a year. You will normally have the option to renew each year, although it's possible that your insurer may decide against this. Rates might change year to year.

The Choices

There are three types of group term life insurance policies:

• Basic: Most employers choose this option, in which they pay the premium, employees receive straightforward coverage, and the premium is regarded as a tax-free benefit for the employees.


• Supplemental: Through this option, employers give employees the opportunity to purchase coverage in addition to the basic coverage. The amount can differ from person to person, and the employee will pay the premium.


• Portable: If an employee retires or leaves the company, they can take this kind of policy with them by paying premiums directly to the insurer-though usually not past age 70.

Amount of Coverage

Group term life insurance isn't designed to replace years of income. It's really more of an emergency fund, which the beneficiaries receive only if the insured dies within the term. There is no cash buildup in the policy. Often these benefits cover things like funeral costs, medical bills, etc. How much coverage you purchase for each employee is up to you. A typical amount is $50,000 because any amount over that includes a taxable fringe benefit, though you may decide to provide enough for funeral costs and a year of salary.

The Costs of Group Term Life Insurance

You won't know exactly how much you have to spend until you begin comparing quotes. There are too many variables, such as the number of employees and amount of coverage. You may also encounter additional costs due to higher average age of your employees, or a staff comprised mostly of women. However, there are so many insurers available online that you can find competitive quotes. If you let NetQuote.com manage your search, you can quickly compare offers for no cost. Then you can create a great benefits package for a modest cost.

Invest in Your Family's Future: Life Insurance Annuities

You may have found a health insurance policy that will help you live a long and prosperous life. But no matter how good you feel in later life, you're going to want to retire and enjoy those years. It's imperative to plan ahead so that you have the means to retire with financial stability. Even before retirement age, you may want an additional savings fund in case of an emergency expense. For either scenario, life insurance annuities are a great place to start. The additional advantage of this kind of investment is that you can name a beneficiary who will receive the payments if you die. Acquaint yourself with these funds and you'll be ready to find the investment vehicle that provides the returns you need.

Defining Annuities

There are many forms of annuities, and even more providers, but essentially they operate as a contract between you and the insurer. You donate money into the annuity, which is like an investment fund, and then you eventually get returns-either an accumulated amount, a set monthly payment, or some combination. If you want life insurance annuities, then you'll designate a beneficiary who will receive the funds. The main reason many people prefer annuities is the tax benefit-the money you put into your annuity can accrue at a higher rate because it won't be taxed.

How Life Insurance Annuities Operate

In the broad view of annuities, there are two basic properties to understand:

• Deferred or Immediate Payments: You may start receiving regular payments immediately, or state a date in the contract on which the benefits will begin. For life insurance annuities, payments are likely deferred to death of the policy holder.


• Fixed or Variable Returns: If you choose fixed, you'll receive a guaranteed return, and your funds will be invested in a low-risk fund. For the life insurance component, you won't be able to withdraw any money for a specified term, but you can choose to have your beneficiaries receive benefits for a fixed term, such as ten years. Variable returns have no such guarantee. They are subject to market fluctuation, but may provide much higher returns than the fixed option.

Distributing Benefits from Life Insurance Annuities

You will first name an annuitant and a beneficiary, who may or may not be the same person(s). The annuitant may be you. Insurers determine future payments based upon the life expectancy of the annuitant, so you should consider setting payments for your beneficiary based upon a longer life expectancy if you want regular payments in the future. Your life insurance version will include a guaranteed death benefit, which means your beneficiary will receive the amount invested, minus a withdrawal fee.

Choosing the Right Annuity

A lot depends upon your willingness to deal with market risk. Are you more comfortable with fixed payments, or do you want to take the chance that your beneficiary might receive a much greater payment? You'll also need to review withdrawal options and fees, in the case that you end up using this investment for retirement rather than life insurance. When you shop around, take into account both the interest rates and contribution amounts, but also take a little time to review the insurer's history if you can. Usually you can find some information on the performance history of a suggested investment fund. Arm yourself with information, and then make a wise and cost-effective choice.