In this post, we’re going to explain how choosing the wrong agent can end up costing you thousands of dollars over the life of your policy. Even when you’re shopping from the best life insurance companies in the market. You see, there are 2 groups of agents – Independent Life Insurance Agents and Captive Agents. Knowing the type of life insurance agent and how they can help you is important in your quest to purchase the best life insurance policy available.
Anyone who has purchased life insurance in the past knows that it can be an overwhelming experience. You not only need to make sure you’re getting the right type of insurance, but also the right company for your specific health and needs.
Buying life insurance and finding the right company when there are hundreds available can make your head explode. The good news is that this search can be easily completed using an independent life insurance agent. In basic terms, an independent agent will simplify the entire process.
Independent Life Insurance Agents
Independent life insurance agents do not work for any specific life insurance company. Instead, they work for themselves and for you. An independent agent has access to multiple companies and sells policies from life insurance carriers that they contract with.
In other words, they sell policies from any company that they contract with – the more companies the better odds they have of finding the perfect company for your health and needs. If you have any risk factors that can increase your rate or make getting an approval challenging – an independent agent can shop you case around.
Captive Insurance Agents
A captive insurance agent can only offer you one life insurance company. The captive agent is limited to a single carrier because they work directly for them. State Farm is an example of a captive agent company. Captive agents and companies are not all bad. If you can qualify for their lowest rates and they beat the competition – then there’s nothing wrong with buying their products. The difficult part is that they won’t comparison shop for you. They only provide you their company’s rates.
Why Buy From Independent Agents
Independent life insurance agents can help simplify the process if you have any sort of risk that you’re aware of (or not aware) that can make securing a life insurance policy.
Life insurance underwriting is very complex. Every single life insurance company has their own unique underwriting rules. In other words, one company can be strict and another lenient when it comes to each underwriting factor. Just to give you an idea of what life insurance companies will be looking into before they approve and rate you:
- Your current and past health information
- Your current and past medication use
- Height & Weight (Build Chart)
- Motor Vehicle Report
- Financials & Bankruptcy
- Tobacco Use
- Family Health History
Take any variable and each these factors can vary from company to company. For example, let’s look at one variable like Height & Weight. Let’s say you’re 5-11 and 225 lbs – one company may rate your higher because of their underwriting guide and another may rate you lower because their Build Chart is more lenient. If you start to combine risks, it gets even more complicated.
The reality is that consumers like yourself and captive agents don’t have access to these underwriting guides – but independent agents do. They’ll find the best company for you based on your specific health and lifestyle. It’s even more important if you are an impaired risk or high risk individual.
Which Agent is Best?
The best type of life insurance agent will be based on your specific situation, budget, health and needs. However, if you’re looking to comparison shop multiple companies and rates, then an independent life insurance agent will be able to help you.
Let’s look at how an independent agent gives you the best chance at finding the best life insurance policy.
1. Reduced Conflict
Remember that independent life insurance agents work for themselves and not a specific carrier like captive agents. Independent agents don’t get a salary from insurance companies, but they do get a commission from the policy that you buy. Their main focus is finding you the best policy at the lowest price from all the companies that they have available.
For example, here at Life Insurance Blog, we use over 60 life insurance companies. We don’t push any specific company. Instead, we listen to your needs and ask you the questions that the insurance companies want to know. We simply present you all of the top companies that you can qualify with and you pick the one that you prefer. Concerned about life insurance company bankruptcies?
When you have access to multiple companies, you don’t have to gamble on a carrier that could possibly be insolvent in a few years.
2. Comparison Shopping
Do you ever shop on Amazon? Do you like searching for a product only to have 1 result? Of course not. Smart shoppers always compare costs from multiple companies before buying. The key is to make sure you’re comparing multiple carriers and not just one.
>>TIP: Did you know that the cost of a specific life insurance product is the same no matter who you buy from?
That’s right- the cost is the same. In other words, the cost of a Prudential 30-year term life policy at Standard will be the same. So if you buy direct from the carrier, from any agent, or website (like SelectQuote) – your price will be the same.
Why is that? Rates need to be approved by the state before they’re sold. There are no “discounts” or “Flash Friday Sales” when it comes to life insurance. So make sure you save yourself a headache and don’t waste time jumping from website to website looking for a lower Prudential rate when you already got one. Use an agent like Life Insurance Blog that will give you 1 on 1 personalized help.
3. Best Rates
An independent agent gives you the best chance for the lowest rates now and in the future. As we mentioned before, the price of your policy will be based on your health and all the other underwriting factors. An independent agent will shop your case based on your current situation now. However, your health can improve and they can shop in the future too. This is a common situation with many of our clients who were rated up on controllable factors.
Some examples of shopping and lowering future rates are with weight loss, quitting tobacco, and improving a specific preexisting condition. Some companies may reduce the rate of your current policy and some situations require shopping to a new company. Your independent agent can help you with either situation.
How to Find An Independent Life Insurance Agent
Good news, if you’re reading this – you’ve found one. Life Insurance Blog is an independent life agent that uses over 60 companies for our clients. If you’re looking for another independent agent, simply search online. Make sure any agent you work with is licensed.
Buying Insurance From an Independent Life Insurance Agent
Working with Life Insurance Blog provides you the easiest and best way to buy affordable life insurance. Our independent life insurance agents are licensed and will shop from dozens of the best life insurance companies in the market. You don’t need to spin your wheels and waste hours doing this on your own. Let us help. We’ll provide you honest suggestions without any pushy sales talk.