We aren’t talking about kitchen tables. In your search for affordable life insurance, you may have heard of the terms “life insurance tables” or “table rating”. Or, you may have applied for life insurance, only to find out you are offered a “table rating”. You probably have no idea what this means. In this article, we discuss life insurance underwriting and the importance of understanding life insurance tables (hint: money!). Knowing the difference and knowing how the life insurance tables work can save you thousands over your lifetime.
You met with an insurance agent about term life insurance. After a discussion about the benefits of term insurance, the agent says to you:
“Did you know only 3% of term policies* are actually paid out?”
“No”, you respond. “Why is that?” A good question.
“Because many people survive the term. That is why term life is so inexpensive. Chances are, you will survive the term and spend money as though you were throwing money down the toilet**.”
You don’t like the sound of that. The agent sees your discomfort and asks, “Would you like to learn a type of life insurance policy that will return your premiums back to you at the end of the term?”
“Yes!”, you exclaim.
Our response if we were with you: hold up. Stop. You need to understand the pros and cons of return of premium life insurance before you go any further. After speaking to us, you may want to simply put your money in that term life policy. [Read more…]