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How to Compare Life Insurance Quotes

There’s a good reason why shopping for life insurance might still be at the bottom of your to-do list. How can you justify spending a large amount of money for something you don’t understand?

That concern is reasonable. After all, you have two valuable things on the line: your money and the financial security of your family. If anything stops you in your tracks when trying to make sense of life insurance quotes, it’s confusing.  We hope to alleviate some of that confusion by providing guidance on the most important factors you must consider when you shop for life insurance. The better you know how to compare life insurance policies, not to mention how best to compare life insurance rates, the closer you will be to making the best decision that protects both your money and your family’s financial security.

What is life insurance?

Life insurance can be used for several things, but the most important one is to properly provide for the people you’ll leave behind one day. Covering lost income, mortgage payments, credit card debt, living expenses, funeral expenses, or even college tuition are critical concerns when you have others dependent on you.      Life insurance is the one thing that can help alleviate those concerns.

Life insurance products keep evolving and the options seem limitless. It is easy to get overwhelmed when choosing the right one     . The best place to start is understanding the two primary life insurance categories and the distinct purpose each one serves.

Term life insurance

For many, term insurance fits exactly what they need a policy to do: provide money to their family if they die prematurely. It’s that simple. You pay a fixed premium for a set number of years. After that time ends, you can either renew the policy, typically at a substantially higher rate, or drop it all together if it is no longer needed. These policies are perfect for younger families who only need to cover a specific time span while they still have dependents under their roof.

Whole life insurance

Those who have longer term needs, perhaps with a spouse or special needs adult child who relies on your income, will fare better with whole life insurance. Although this insurance type is a bit pricier, it offers a whole lot more than term life. Unlike term, premiums will stay fixed as long as the policy is kept active. Cash value is accrued within the policy that you can access tax-     free at any time and there is a guaranteed minimum return according to the policy’s terms.

So, what’s your best option? It really depends on what you want your insurance to do. Term life insurance is the cheaper option while you’re young, but it gets extremely costly as you age. These substantially higher rates are the reason why most term policies lapse. Having a policy that ends before you do means that the money you spent didn’t accomplish what you intended: provide a financial safeguard for your loved ones when they need it.

The most important thing to understand about life insurance is that for it to work, you must die with the policy in force. That’s why whole life insurance may be the better option if you’re either nearing or already in retirement. It offers permanent protection with fixed premiums regardless of changes in your health status, giving you lifelong coverage.      In fact, it’s an ideal solution for covering those costs your family members can expect to pay, such as burial and other final expenses after you pass.

How are life insurance quotes determined?

What are quotes?

Quotes are estimates of what an insurance provider will charge you for your policy. They are not the final offer nor a written contract, but rather an estimate of how much they think it will cost to buy insurance.

How are quotes determined?

Life insurance quotes are calculated through a process called underwriting. At its basic function, underwriting is the process used to assess risk and assign a cost to that risk. Beyond that, things get more complicated. Insurers are on the line for a significant amount of money when new policies are issued. Therefore, underwriters must account for a number of several factors relative to a mortality table to determine your life expectancy. No easy feat.

Underwriters receive most of the information they require from you, beginning with a stringent application that reveals your medical history and lifestyle choices that affect health. This information will give the insurance company a better understanding of how much to quote or even if they should proceed. If they give the greenlight, you’ll move forward with a medical exam given by a designated healthcare practitioner that will reveal more critical information to derive an accurate assessment of your health.

However, if you’re concerned a current health condition could get you denied, it’s comforting to know that different insurance companies treat medical conditions differently. Each company has their own unique process for handling underwriting. That’s why it’s a good idea to get quotes from a few different companies to ensure you can get the best life insurance quote from the right provider.

What factors could affect my quote?

Although a considerable amount of information goes into the underwriting process, it’s not foolproof. After all, no one can predict the future. However, insurance carriers are meticulously examining all past and future factors that could affect your health and potentially premature death. The biggest factors that move the dial one way or the other include:

  • Age: The older you are, the costlier more expensive you are to insure.
  • Gender: Men tend to receive higher quotes than women since their life spans are shorter.
  • Health: More health conditions will increase your cost of coverage.
  • Weight: The more you weigh, the more you pay.
  • Alcohol & Tobacco Use: Smoking and excessive alcohol use are known to undermine health and cause premature death affect life expectancy and result in higher premiums.
  • Lifestyle: Engaging in dangerous activities such as sky diving or rock climbing.
  • Career: Specific jobs such as being a firefighter or police officer carries higher risk.
  • Amount of coverage: The higher the death benefit requested, the higher your premium will be.

What can I do to get the best life insurance quotes?

When it comes to finding the best quotes, some things are outside of your control such as age and specific health conditions. This can make it challenging to shop for life insurance quotes. However, there are other areas of your life you can change or improve to bring quotes to a more affordable level and ensure your policy does what you intend it to do.

Start as soon as you can

You can’t make yourself younger, but time is still on your side today. The longer you delay, the older you get. As the adage goes, the best time to start was 20 years ago. The second-best time is today.

Attack the health factors you can control

Nothing sends out a red flag more than obesity, smoking, or excessive drinking since they impact your health at many levels. Before you consider applying for life insurance quotes, it’s a good idea to quit smoking and get your weight under control if you want those rates to be more affordable.

Work with a healthcare professional

Even if you have a serious health condition such as diabetes, working with a physician or other professional to get it under control will work in your favor. Insurance providers see this as a good sign because it shows you're serious about maintaining a healthy lifestyle.

Disclose everything

As tempting as it is, don’t withhold lifestyle or health conditions that could lead to higher insurance quotes. Insurance companies are good at examining everything when it comes to your health. It’s likely they’ll discover your hidden medical condition during the medical exam. To protect themselves, many life insurance providers give themselves two years to rescind the offer and cancel your policy in the event critical information was withheld. If you were to die within that time, they will check your medical records against your application to find possible misstatements. This will only leave your family without the death benefit they were counting on. If you withhold critical information, your claim may be denied when your family needs it most.

What should look for in a life insurance quote?

The best life insurance quote reflects a policy that not only supports your family when you pass but is also affordable.

Unfortunately, looking for life insurance quotes is no easy feat. Available options seem limitless. There are a variety of choices that can easily overwhelm and complicate the process. To help simplify things, here are a few factors to consider.

1. Does it provide the coverage that you need?

It’s true that any amount of life insurance you leave your family will be helpful. But it’s likely not your intention to have them barely scrape by after you pass. That’s why it’s important to firmly establish what you want your insurance policy to accomplish so you can accurately examine every quote.

To make it simple, choose your most important goal and go from there. Do you want it to sustain the same standard of living your family is accustomed to? Do you need to cover a mortgage and or other outstanding debts? Do you want to provide supplemental funds in the event of unforeseen healthcare expenses? Or, maybe the only thing your loved one needs is the ability to cover funeral costs and other final expenses associated with your death.

Getting your objectives down will ensure your quote will carry the proper coverage your loved ones need so you can effectively evaluate whether the cost is truly worth it.

2. Does it contain the benefits you want

While term life insurance is fairly straightforward – a fixed premium for a set time – whole life insurance provides more options. It offers additional benefits you can’t get from a term alternative.

For instance, if a living benefit is important to you, you’ll want to ensure that your life insurance quote carries a cash value. This is the portion of the premium that accumulates cash over time. Add in guaranteed interest and possible dividends, and your funds will grow faster. This cash is accessible as a policy loan while you’re still living, and it can be used for any purpose – retirement, debt, vacations, investments, or even as premium payments. For many, this is an important feature because the death benefit remains intact as long as the loan is paid back, or the provider will deduct the outstanding balance from the final payout.

3. Is it affordable with costs you can handle?

No one wants to spend too much on life insurance. However, it’s important to note there are a lot of extra costs that make up a policy. After all, it’s not only about the death benefit.

Life insurance companies are assuming great risk when they issue a new policy – especially if they must issue a payout long before they have time to recoup costs. In the case of whole life insurance, it’s to the provider’s advantage that these costs are covered in the first few years of issuing the policy in the event an owner cancels a policy during this time. Because premiums are distributed to separate areas of your policy – the death benefit, operating costs, and the cash value – a large portion of your premium will first go to both the death benefit and operating costs in the earlier years of the policy.

How does this affect you? The cash value component won’t build up as fast as you might think. It’s similar to a mortgage where payments are used to pay off interest before they are added to principal. Your premiums are used to pay off expenses first before adding to the cash value of your policy – which could take several years to accumulate.

It’s important to understand the impact of these costs when looking at an insurance quote since they not only affect your wallet, but the value of your policy. If a large cash value is important to you, and you don’t mind the extra cost, consider a Paid-Up Additions Rider. This additional insurance to your policy helps you take advantage of time and the compounding effect to make your cash value grow faster.

What should you look for in a life insurance provider?

What you need from a life insurance provider extends beyond just good customer service. No one wants to spend thousands of dollars on a policy over years, only to watch the insurance provider go bankrupt, leaving loved ones without a financial anchor you intended them to have. You need your provider to be there to keep its financial promise.

There are state guarantee rules to protect policy owners in the event a carrier collapses. However, these amounts are limited to each state’s statutory limits, generally averaging $250,000. Unfortunately, nothing is failsafe. That’s why it’s imperative to know what you should look for when assessing a company’s financial stability to ensure they will stick around for as long as you do. Here are a few to consider:

Agency ratings

A few professional rating agencies have been established to help determine the financial stability of each insurance company. The top rating agencies include A.M Best, Standard & Poor’s, Moody’s, and Fitch. Each agency conducts its own extensive review process by weighing a number of factors. They then designate a letter grade based on that analysis. Typically, these grades range from a high rating of AAA down to a low of C.

Letter grades seem easy, but trying to decipher what they mean may not be. This is because agencies differ on their methods to determine financial integrity. Therefore, letter grades mean different things to different agencies – each could hold a different value based on the specific agency’s methodology.

For instance, one insurance provider may be assigned an A+ rating by one agency, only to be given a B rating by a different one. To ensure that you get a comprehensive view of a company’s overall health, don’t look at only one agency. It’s smarter to factor in the ratings from at least a few of them.

The best way to find these ratings is to either obtain them from your insurance agent or go directly to the websites of these agencies. It’s helpful to know each agency’s minimal rating relative to what they deem as solid financial strength, such as an A+ from A.M. Best or an AA from S&P. Insurance companies may also post these ratings on their own websites.

Although high ratings won’t ensure the safety of your policy over the long term, they are good indicators to determine which insurance providers to consider and which ones to avoid.


It goes without saying that the longer a company has existed, the stronger the probability it will continue to exist. There are some insurance providers who opened their doors in the 1800s to early 1900s and are still running strong.

Consecutive dividends

Dividends issued by an insurance provider are the profits made for the year and refunded back to participating policy owners. Essentially, they are a return of a portion of the owners’ premiums that were used to make an investment. A consistent surplus paid out in dividends can be a healthy sign of financial strength.

How to compare life insurance quotes

You did your homework. You examined your needs to decide on the type of policy that best fits your objectives. You looked at different insurance companies to ensure you’re considering ones with strong financial integrity. And you have a good idea of what you can afford so you won’t risk your policy lapsing due to high premiums you can’t cover. So, what’s the next step?

It’s time to compare life insurance quotes.

It seems obvious, of course, that choosing the best life insurance quote is simply a matter of comparing the premiums of policies from different providers that offer the same coverage. Considering all the various elements that make up a whole life policy, the best way to compare life insurance quotes across multiple providers is to use an apples-to-apples approach. Every policy you look at must contain identical terms and benefits – or at least close enough.

A common mistake is to assume policies are the same because the face value is the same. It’s imperative to dig in and understand each one to uncover differences that might be important to you. This could include differences in the amount of coverage, administrative and overhead expenses, or interest rates and dividends - all of which affect your cash value growth. It’s also helpful to know where your premiums are being designated until you start accumulating cash.

Another important factor to consider when comparing life insurance quotes is the medical requirements. Rather than participating in a medical exam to determine eligibility, you may want to simply answer a health questionnaire. There are forms of whole insurance, such as funeral insurance, where a medical exam isn’t necessary to qualify. Be sure to check the application process of any policy you consider to be sure it lines up with your wishes.

Lastly, to ensure that each provider is weighing the same variables in determining their quote, be sure that you’re submitting the same personal information to each one. A slight variance could skew the quote, and as a result, the decision you arrive at when comparing them.

What are some red flags to watch out for?

With the onslaught of online customer reviews, it would be hard to hide a complaint against a product or service, regardless of whether they’re true or not. Discovering whether an insurance company has any red flags is no exception. However, there are some things to keep in mind when looking at them.

The biggest one is not to take reviews at face value, but to actually read the comments. In order to make an accurate decision about the integrity of a company, it’s important to understand what the complaints are about and how vigilant they are in responding to them. In fact, you can often find what you need on the website of the Better Business Bureau.

Understanding the red flags

A common complaint that often comes up with insurance companies is the quality of customer service. People don’t want to do business with a conglomerate. They want to do business with other people. If policyholders are complaining they can’t get their questions answered or are unable to access someone to help, it could be a warning sign. You don’t want to get a policy only to find out down the road that it is difficult to get in touch with the company through their customer service department.

Complaints that the company doesn't pay its death benefits in a timely manner is another major warning sign. Something else to consider, however, is that some complaints come from people who don’t understand the policy they bought. For example, guaranteed issue policies will not pay a death benefit until premiums have been paid for a specific period of time, usually two to three years. If the holder dies before that time, the beneficiaries will not receive the face value payout.

In a case like this, it is understandable that beneficiaries would be upset when a loved one paid premiums into a policy only to come up short when it’s time to pay for funeral expenses. It’s an unfortunate event, but the policy holder agreed to the terms when buying the policy. If your policy has time restrictions, it’s critical you go through the timing requirements with your beneficiaries so there are no surprises. You are doing everything you can to protect them from unnecessary financial stress, make sure you protect them from unnecessary emotional stress as well.

The best quote is the one you qualify for

Whether you compare whole life insurance quotes online or through an agent, keep in mind that sometimes the best quote is for the policy you are qualified to get. You may have found a number of companies with affordable policies that meet your financial objectives but can only qualify for one or none of the options.

That’s why it’s imperative to know all the options available to you. Most people can find a policy to serve their needs at a rate they can afford. If your biggest concern is to cover final expenses and burial costs without a lengthy underwriting process or medical exam, a whole life insurance plan known as funeral insurance, or final expense insurance, could be the best fit for you.

Request term and whole life insurance quotes online

At Lincoln Heritage Life Insurance Company®, we don’t require a medical exam to qualify for coverage. Just answer a few simple health questions on our one-page application, and receive free info as well as a quote. For further assistance, reach out to us today. We’re happy to help.