Buying Term life insurance

[Mt Tahoe]

Hello All,

I need to get some term life insurance as part of our adoption and was looking for information about buying. Have not found much online, or at Consumer Reports. I have been speaking to an insurance broker but not sure if there are better deals out there. Does an insurance broker charge a commission that I need to pay? Is it cheaper to go directly to a major company?

I asked MMM to do a write up on this, but have not heard back from him. It would be a valuable read.

We are in our early 40s so only looking to get a 20year policy that should get us way past college years. by then, we should have reach FI.

Thanks.

[brewer12345]

20 year term should definitely be sufficient.  There is nothing wrong with using an independent agent, not tied to any particular company.  To make sure the prices they show you are not out of line, I would hit the websites of TIAA-CREF and USAA and get quotes from them.  They are both high quality companies that sell direct so you can get clear quotes.

I would also be particular about who you buy this from.  You want a larger company, preferably mutual, and a minimum claims-paying rating of AA-/Aa3.

[Mt Tahoe]

Thanks for the advice. The quote my agent is giving me is just shy of 800 with American General Life co. My current insurance (home and car) quoted me 4 times that. Tiaa-cref more at 960. Does USAA provide life for non members?

Numbers really vary a lot. it is kind of crazy.

[rayt168]

You can buy life insurance from USAA without being in the military, but not car insurance. 

[brewer12345]

Thanks for the advice. The quote my agent is giving me is just shy of 800 with American General Life co. My current insurance (home and car) quoted me 4 times that. Tiaa-cref more at 960. Does USAA provide life for non members?

Numbers really vary a lot. it is kind of crazy.

FYI, American General = AIG.  They are an investment grade rated company, but do not meet my minimum credit requirements for this sort of policy.

I would also go to insure.com or one of the other online independent agents and see what comes up.

[Mt Tahoe]

Thanks Brewer. what grade rating would you recommend? also, where do you find ratings. I found some but seem like they were for 2009. I will look at USAA.

[brewer12345]

Thanks Brewer. what grade rating would you recommend? also, where do you find ratings. I found some but seem like they were for 2009. I will look at USAA.

AA- (from S&P)/Aa3 (from Moody's) or better is my minimum.  You also stack the  deck in your favor if the insurer is large and/or mutual.  Most companies will have current ratings on their websites and you can also get them on Moody's and S&P's sites (you may have to do free registration).

[Mt Tahoe]

USAA 929

[Nords]

USAA 929

If you decide not to go with USAA, and if Brewer's excellent recommendations don't pan out, another option is Jeff Rose's LifeInsuranceByJeff website. 

If you're a military veteran (general or honorable discharge) or if one of your immediate family members was in the military, then you'll be able to qualify for USAA membership.  I don't know if it'll reduce your premiums, but you could save money on vehicle & property insurance.
https://www.usaa.com/inet/pages/why_choose_usaa_main?wa_ref=pub_global_usaaandu#