When considering homeowner’s or auto insurance, you probably count on your insurance agent to assist you in understanding the many options available. For instance, what deductible should you choose? Should you pay for emergency road service or not? Should your teenager have their own policy? How much coverage do you need? You value this relationship, but you wonder if you might get a better deal on your life insurance if you buy directly and cut out the intermediary.
While you may attain a better price, it is also likely that you may not. More importantly, you may get what appears to be a better deal on the surface but, on closer examination, is not as good as you initially thought.
If you call a life insurance company and apply over the telephone for the life insurance they quote you, you may be in for several surprises, either now or later.
First, cutting out your insurance professional does not always result in a lower life insurance premium. However, it does mean you will have to depend on an “800” number and the person answering the phone. As with any telemarketing organization, there is often high turnover in these positions, so you may never develop a relationship you can rely on.
Second, you should be warned that all “comparable” policies are not created equal. Although insurance plans may appear the same on the surface, there could be vast differences when you examine the details. The period where the premium stays the same (for term life) may vary; the guaranteed and current interest rates may change (for universal life); the investment options may not meet your needs (for variable life); and the interest/dividend crediting may not be what you think (for whole life). Many riders, options, and other features can make one plan more suited to your needs. Unless you know about these options and can tell the voice at the other end of the phone exactly what you need and want, you may end up with the wrong insurance policy.
Third, your trusted insurance professional knows you and understands your needs. Someone you have never talked to before may not know about your disabled daughter, your planned pregnancy, or your need for spousal insurance. How will they learn to ask about these things if they can’t tell you? An advisor who knows you and your family is in a much better position to ensure you obtain the right type and amount of life insurance. They can also decrease the likelihood of being surprised after underwriting with a much higher premium than initially quoted.
Fourth, you may have existing life insurance that can be adapted to meet your current needs, and this reduces or avoids underwriting and may save money in new premiums.
Your financial situation is complex as well as ever-changing. Working with Brian Gruss, who knows you and can meet with you face-to-face, can help you avoid problems and may help prevent costly mistakes when buying life insurance.