Online life insurance quotes have changed the face of the life insurance industry. Life insurance policies existed since the 1800s and can even be traced back to ancient history in some form. So how does this ancient concept apply in the modern world? By bringing the life insurance market and its agents to your computer.

Insurify acts as your life insurance representative by giving you the advantage. Before you make the important decision on which policy is the right choice for your peace of mind and your loved one’s well-being, use Insurify to help simplify your quest for the right life insurance policy. Answer a few questions, and Insurify will generate a quote list from leading life insurance companies for you to compare.

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Online Life Insurance Quotes—The New Life Insurance Agent?

Traditionally, life insurance agents have solicited business, prepared quotes, and been the first point of contact for customers. But nowadays, with so much information at our fingertips, the landscape of life insurance sales has changed. Yet the topic of life insurance remains a sensitive one. Because of this, life insurance customers may still feel more comfortable speaking with an agent face to face.

Today, you can compare quotes and buy life insurance right from the comfort of your home without ever speaking with an agent. Whether buying online, over the phone, or in person with an agent is the right choice for you depends on what you are comfortable with and your personal preference. Let’s look at the role of a life insurance agent and how it has translated into the online market.

Practical Divisions in Life Insurance Companies

The life insurance industry, like all businesses, has practical divisions to keep things running smoothly and ensure the standards of their products. These divisions include underwriting, which analyzes applicants’ risk and determines premiums; claims, which receives, investigates, and decides to pay, reject, or settle the claim; actuarial, which assesses financial risk; and marketing and sales, which is the role of the insurance producer.

Life insurance agents and brokers solicit business and promote and sell life insurance products for life insurance companies. In person, they can communicate the benefits of their products while listening to your needs and concerns. They are also able to perform the first step in underwriting, field underwriting. Because the applicant is face to face, the agent can report their visual health. 

Online insurance quotes use a marketing direct response system and provide a free quote, which was traditionally reserved for life insurance agents. By marketing online, companies can sell their insurance products directly to customers without a life insurance agent. If you have any questions or would like to buy a policy through an agent, you can message or call the life insurance company‘s representative. 

Life Insurance Producer’s Authority

Life insurance agents are employed by the insurance company or refer to an agency that acts for the insurer. Life insurance brokers can work independently and sell insurance for different insurance companies. Whether independent or an employee, insurance producers have a contractual agreement, they must meet the company’s guidelines, and they have the authority to act on the insurer‘s behalf.

Life insurance agents have the express authority to find business and sell policies for the insurer. If an agent acts outside of company guidelines, the insurance company is liable for the agent’s actions. While searching for the right policy online, you must do the reading and evaluation of the policies. Though you may speak with a representative, a misrepresentation by the agent is less likely.

Producer Responsibilities to Applicants and Insureds

It is the life insurance producer’s responsibility to act in the best interest of the applicant and the insured. This includes making sure all products and recommendations are suitable for the consumer, disclosing all important information about the proposed policy, and abiding by insurance regulations and insurance trade best practices. 

It is also the duty of the life insurance agent to provide the applicant or insured with the premium receipt and deliver the policy. Premium receipts provide temporary coverage during the application process, which involves underwriting and possibly a medical exam. Premium receipts are given only after the applicant has paid.

When purchasing insurance online, your policy and your receipt are delivered electronically. You can choose to speak with an agent to sign your documents or e-sign. With online services such as Insurify, your digital signature and confidential information are encrypted and not sold to third parties. 

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Producer Fiduciary Duties

A fiduciary is a person holding funds for the benefit of another person. An agency agreement with an insurer creates a fiduciary relationship between the two parties. Fiduciary duties of a life insurance agent include disclosing all information to the insurer that affects the placement of the policy, fully accounting for premiums, and not mixing premiums with personal funds.

Since online life insurance quotes are performed electronically, a life insurance agent does not handle your money. Payments are processed online, and so is all pertinent information that influences your application’s acceptance. You essentially deliver the funds and application to the insurance company yourself. 

Online Life Insurance Options

Life insurance wouldn’t be life insurance without options. It is a product designed to be as complex as the people it covers. Because of this, the life insurance market may be tough to navigate. Consulting a company’s life insurance agent is one option, or you can equip yourself with the knowledge to do the shopping without assistance.

The key to finding the right insurance policy is knowing what you are looking for. The most important thing you need to know about life insurance policies is the different types of life insurance. The key things you want to know about are term life insurance, whole life insurance, and universal life insurance. Understanding how these policies work is crucial to finding the right policy for you.

Term Life Insurance

Term life insurance is a type of life insurance policy that is in effect for a determined period of time. Once the time frame has been reached, the contract ends. Features in term life insurance policies such as renewable and convertible options allow you to renew the contract or convert it into a permanent policy so you don’t go without coverage.

If you pass away while the term life insurance policy is in effect, the policy will pay out the death benefit to your beneficiaries in a lump sum. When choosing the amount of coverage of your policy, consider your annual income and the number of years your family may need the financial support that is lost upon your passing. Also, consider your financial plans, budget, and important expenses.

Term life insurance is usually a more affordable life insurance coverage than other types of policies. This is because most term life insurance policies do not have the savings or investment features that permanent insurance policies have. Though term life insurance policies do not have this feature, you can use your term life policy’s coverage to provide protection for important expenses, such as your mortgage.

Because life insurance needs may include the certainty that your credit card debt, your mortgage, or your child’s college tuition is covered in the event of your passing, term life insurance includes contracts called decreasing term policies. These policies last for the same number of years as your debt, and premium payments decrease as your debt does. If you pass away before paying the debt, the policy will cover it.

Permanent Life Insurance

Permanent life insurance policies, also called whole life policies, are any type of life insurance product that lasts for your lifetime. Whole life policies provide a guaranteed death benefit and a living benefit called cash value. How the cash value grows depends on the type of whole life policy you choose. A traditional whole life policy grows cash value in a savings or investment account at a minimum rate.

Universal Life Insurance

Universal life insurance is a type of permanent life insurance whose features include flexible premiums and an adjustable death benefit. Policyholders can reduce or increase monthly premiums or not pay a premium at all. Cash value grows in an investment and savings account and can cover premiums. You may also decrease the face amount of the policy or increase it, which is subject to insurability.

Variable Life Insurance

Variable life insurance is a whole life product where your premium payments are allocated to investment subaccounts that you own. There is a guaranteed minimum death benefit, but the cash value and death benefit change with the performance of your investment subaccounts.

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The Cost of Insurance 

Life insurance rates are established during the underwriting of the application process. Factors that affect the cost of your monthly premiums include your medical history, health condition, and the amount of life insurance you’re purchasing. Most online life insurance quotes will have a brief health questionnaire, and some insurers may require a medical exam.

If you have medical conditions such as high blood pressure or high cholesterol, you are considered a high-risk applicant. If you are approved, monthly premiums will be more expensive than if you were in perfect health. Your age and whether you are a smoker also influence your life insurance cost. You provide this information on your health questionnaire.

Some life insurance companies may ask for a medical exam before your application can be approved. This usually takes 20–45 minutes. The life insurance company may send a representative from a testing service provider to your home or workplace to check your weight, height, and blood pressure and collect a urine sample. Your results affect your premium payments and may disqualify you from approval.

If you are a senior with health conditions, you may want to consider a whole life final expense policy. These policies are typically more expensive because they cover high-risk individuals and do not require a medical exam. These policies are intended to cover \ your final expenses, such as burial and medical costs.

How much life insurance you buy is also a determining factor in your life insurance premiums. Life insurance companies offer face amounts of insurance from thousands of dollars to millions of dollars. The higher the coverage amount, the higher the premium. Examining your annual income, financial plans, and goals will help you determine how much life insurance to buy.

Receiving Your Policy

Once you have educated yourself on the different types of life insurance, evaluated your important expenses and annual income to determine your coverage amount, and found the right insurance policy for you, it’s time to apply. Review all documents carefully before submitting them because any mistakes may hinder the application process.

After you’ve filled out and submitted your application and had a medical exam, and underwriting has determined your premium, it’s time to review and accept your policy. Life insurance policy documents are usually provided by the life insurance agent, but if you purchase online, you may receive your policy electronically.

After you receive the policy, your life insurance company may require you to sign a delivery receipt that confirms you received the policy. As long as you pay your premiums, your policy cannot be canceled or terminated for any reason. If you review your policy and everything is not as expected, you can reject it or contact your company for assistance.

Let Insurify be your first point of contact in your search for the right life insurance policy. With Insurify you choose the face amount of the policy and the type of coverage you would like to have and they will deliver a list of quotes from the best life insurance companies in just a few minutes. 

FAQ: Buying Life Insurance Online

What should I look for when searching online for the right insurance policy?

When searching online for the right policy, determine which type is best for your life insurance needs, and evaluate the company's life insurance options for those products.

Can I buy a policy without speaking with a life insurance agent?

If you are purchasing your policy online, you may not need to consult with a life insurance agent. But some life insurance companies may require you to speak with a representative to sign your application or purchase the policy.

After I pay for my policy, will I be insured?

The rule of thumb is after you've made the first premium payment toward your policy, you will be given a premium receipt. This receipt gives you temporary coverage while your application is under review by the insurance company, although some companies offer instant approval policies.

Life Insurance and the Internet: a Happy Union

The insurance industry has traveled a long way through time, from the barter-and-trade system to the direct marketing system, and it makes for a happy union. Though you may still want to consult with a life insurance agent, the option to learn for yourself and determine the right policy for you and your loved ones allows for even further peace of mind.

With Insurify, you will know in a matter of minutes which policies are a good fit for your budget and cover all your life insurance needs. Once you have found the right policy with the right insurance company, you can choose to speak with a representative or purchase on the site.

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Updated February 15, 2021

Aissa Martell is a licensed insurance producer in the State of New York. She is a creative writer and has been freelance writing for five years. She’s happy to share her knowledge of the insurance industry and its products.