Good Term Life Insurance Companies

[sobezen]

Do any of you have a term life insurance policy?  What companies do you recommend (good and bad)?  I am looking for 30 year term insurance (no living benefit needed) from a company that allows annual premiums to be paid in full by credit card.  I do not want to set up an automatic draft from a bank account.  Nor do I want to have the 'privilege' of paying an addition fee per month to the insurance company. 

To clarify I reside in California and I currently have a permanent policy but it seems financially wasteful to pay more when I can exchange the policy for a 30 year term.

Looking forward to hearing the community thoughts on this topic.  Thanks in advance.  Cheers!

[Goldielocks]

Ok,  since "dead is dead", there should be no fighting to pay out with a term insurance policy.   I would just shop it around and go for the lowest rate.  Check your bank, professional and school associations for the lowest possible rates.

As for credit card,  if you can find one that is a lot cheaper, I think you could come up with means to pay other than credit card to save a bit of money...?. 

To my knowledge, all the companies I shopped insurance at PREFER credit card payments, as they can auto renew until you cancel, which is much easier for them.

[sobezen]

Thanks for replying goldielocks.   Currently, I pay the auto license, car, umbrella, and roadside assistance plans upfront entirely by credit card; so I feel it is ridiculous when life insurance companies claim they cannot accept credit card payments.  I spoke with an agent from TransAmerica and he informed me the company would only accept the first payment by credit card but no further payments.  What?

Also, this agent informed me most insurance companies do not allow payment of premium by credit card because is borrowed money/debt.  He explained the insurance company is reducing their risk by 'encouraging' policy holders to set up bank auto draft.  I specifically do not want to do this because insurance companies adds a fee to each payment be it monthly or semi-annually.  As such I want to pay the term insurance annual premium in full but, funded with a credit card.  Has anyone else done this?

[Goldielocks]

Huh,   100% of the companies I shop insurance with were fully pay by credit card.  Perhaps their response is because of high cc fees to the orginating office.

Some *most* do have a fee for monthly versus annual payments, but all accepted the CC.   

Try online insurance.  Good luck.

[Dicey]

I live in CA too. I had term LI  for a few years as a condition of a business deal. I found a company called WAEPA, and they were extremely reasonable, plus IIRC, part of the premium was refunded annually. You have to be a veteran or related to a veteran to qualify, but in case you are, it's worth checking them out. I don't even think it had to be an immediate family member, so it's worth a little research. Far cheaper than anything else out there at the time.

I have no idea if they take CC's, but I am sure my payment was not automatic. Why would a mustachian want to pay anything more than the lowest price possible? What's wrong with paying via online banking, for example? I understand not wanting automatic payments (other than the kind you set up yourself) but why must it be payable via CC?

[sobezen]

@ Diane C:  It is precisely because I am mustachian that I refuse to pay more than is necessary for a product; it does not have to be the lowest but it needs to be a great value.  I do not want to pay using online banking because there is no benefit in doing so (be it cash back, miles, or points).   I feel it is ridiculous that insurance companies make huge profits but do not offer discounts or allow for more flexible payment forms such as credit card especially for people with excellent credit. 

I appreciate your suggestion about WAEPA but I am not related to anyone who has served.  I checked their site and WAEPA does not accept credit card payments for premiums.

[Hvillian]

Shop around a bit.  I tried 3 or 4 companies for my wife, and the rates and underwriting process varied more than I expected.

Her Policy is with TIAA, and I just paid the first annual premium via Credit Card.
TIAA https://www.tiaa.org/public/offer/products/life-insurance

[sobezen]

@ Hvillian:  Thanks for sharing TIAA.  I've been shopping around.  Researched Geico, Nationwide, Pacific Life, Selectlife, and AIG.  Still waiting for quotes from most.  There are tons of companies that will offer immediate term policies but the duration is typically short, most are just ten years.  I need 30 years.

[catccc]

We have carried long term (20?) year policies with ING-ReliaStar.  I believe they accepted CC payments, but we were only with them a few years before we re-evaluated and purchased more insurance with AIG.  (added a second kiddo to our family, wanted more coverage to support another person, and a longer term to have coverage until kids are both out of school).

When we were shopping, we were able to back date our policies by some number of months to lower our annual (fixed) premium because of an age cut off.  Yes, this means the term ends x months earlier as well, but I think the savings are worthwhile.  They also let us have it for an odd number of years.  I think I purchased a 28 or 29 year term for both DH and I, and my policy was back dated a couple months to my half birthday for a lower premium.

We purchased in 2011 and for 29 years of coverage, when I was 31 and DH was 33.  We pay $319/yr for $500K of coverage for me, and $348/yr for $400K of coverage for DH.  They did come by with a health technician type person for bloodwork and to get our height and weight and that kind of stuff.  IDK how those prices stack up to current rates, but at the time they seemed reasonable.  (If they are not, let me know, maybe we'll shop around and dump these policies.)

ING-ReliaStar did accept CC payments, I believe.  But AIG does not.  I don't think this is a huge deal, though.  We pay annually via annual bank draft and we don't pay any fees.  Hunting for a place to yield us an extra $6 in bonuses every year for the remaining years we pay the premium sounds like a proposal of diminishing returns.  We likely will drop the policies far in advance of the end of the term due to reaching FI.

Both times we shopped through matrixdirect.com

[Goldielocks]

@ Hvillian:  Thanks for sharing TIAA.  I've been shopping around.  Researched Geico, Nationwide, Pacific Life, Selectlife, and AIG.  Still waiting for quotes from most.  There are tons of companies that will offer immediate term policies but the duration is typically short, most are just ten years.  I need 30 years.

Why do you need 30 years? 

The constantly renewable ones will not ask for another medical check as long as you don't increase the coverage amounts, don't end with your employment, etc.  Instead, you get your premiums increased every 5 years as you age.


This is in exchange for very low rates now, and high rates later.  At age 45 or so, is the break even point (for mine), but after that, I don't actually need much life insurance any more as I am financially independent and dependents get investments and a home upon death, rather than a life insurance payout.

I highly recommend that you look into the immediate life insurance based on the rates.
OR, tailor the number of years you need it to the number of years until you are financially independent.


ETA -- if you really do need 30 year for some reason (taxes upon death?), then maybe the permanent policy is not such a terrible choice.. it depends on WHY you need insurance until that age.

[chesebert]

Check the credit rating of the insurer. I would not go below A personally but definitely make sure they are investment grade.

[sobezen]

@ catccc:  Thanks for sharing your experience and sharing the matrixdirect.com and AIG sources.  I will check them out.

@ goldielocks:  I feel I need 30 year term level b/c I am only 41 years old.  I have aging parents and an estate tax bill to deal with.  I already have a permanent policy but I am looking to reduce the face value mainly due to cost.  I can actually FIRE now but that assumes I never marry and have children.  I'd like to do both so that is why I feel it is prudent to get 30 year level term.  As I understand it with the level term the premiums do not increase.

[Goldielocks]

Okay,  so you believe that your aging parents are your "dependents" in terms of their long term care?

Wouldn't the permanent policy cover your tax liabilities sufficiently?  A Term to 100 or permanent policy is usually preferred for tax reasons upon death.

I guess I would seriously consider just increasing your portfolio, and getting term coverage for a few years to cover any gap if you have children... but you may be seriously close to retirement by then. 

Think of it this way -- the insurance is to cover your income that would otherwise be lost to your dependents upon death.  What is your retirement year --5 years,  10 years?  15 years?  Why not just have insurance to cover to your planned retirement date?   Certainly anyone choosing to be on this forum is not planning to retire at the age of 71?

[sobezen]

@ goldielocks:  Currently my parents are my dependents until I get married.  I am an only child, so I choose to help them.  They do not have LTC.  My permanent policy is expensive which is why I am lowering the face value by 20% that is the max you can lower for Transamerica per year.  And I am adding a 30 year term policy so it helps when things matter the most to the people I leave behind while my dependents need it the most.  If in the best case I never use the DB because I live, I am considering the LB (living benefit) offered by AIG which is still affordable compared to what other companies offer.  This way if I get into an accident (very high considering how much I drive), I can use the living benefit.  The permanent policy will remain in some amount which will help but not cover the estate tax issues I have.

[Dicey]

@ Diane C:  It is precisely because I am mustachian that I refuse to pay more than is necessary for a product; it does not have to be the lowest but it needs to be a great value.  I do not want to pay using online banking because there is no benefit in doing so (be it cash back, miles, or points).   I feel it is ridiculous that insurance companies make huge profits but do not offer discounts or allow for more flexible payment forms such as credit card especially for people with excellent credit. 

I appreciate your suggestion about WAEPA but I am not related to anyone who has served.  I checked their site and WAEPA does not accept credit card payments for premiums.

Well, um, thanks for chapping my hide? Perhaps this information will prove useful for someone else, since this is a "forum" and all. Best wishes to you in your search, sobezen. Over and out.

[katsiki]

I have mine with Fidelity.  They take credit cards.

[Radagast]

Do the math. If you assume a 5% (or whatever) rate of return on your investments, a guaranteed renewable 10-year term will probably be cheaper even if you continue to renew it for 30 years. I did some insurance shopping about a year ago and found that in nearly all cases less insurance resulted in me ending with more money.

I used State Farm, but that was because I can walk there from here and already had insurance with them.

[boarder42]

Wtf do you need a 30 year term for. If you hadn't noticed you're in an early retirement forum. I can understand if u have a single income family with kids and want term life til you FIRE but 30 year term is just as much a waste as complete life

[sobezen]

@ Diane C:  It is precisely because I am mustachian that I refuse to pay more than is necessary for a product; it does not have to be the lowest but it needs to be a great value.  I do not want to pay using online banking because there is no benefit in doing so (be it cash back, miles, or points).   I feel it is ridiculous that insurance companies make huge profits but do not offer discounts or allow for more flexible payment forms such as credit card especially for people with excellent credit. 

I appreciate your suggestion about WAEPA but I am not related to anyone who has served.  I checked their site and WAEPA does not accept credit card payments for premiums.

Well, um, thanks for chapping my hide? Perhaps this information will prove useful for someone else, since this is a "forum" and all. Best wishes to you in your search, sobezen. Over and out.

I wasn't 'chapping your hide.  My frustration is directed towards insurance companies.  Sorry if my tone was not correctly expressed.  Thanks again for your help. :)

[sobezen]

Wtf do you need a 30 year term for. If you hadn't noticed you're in an early retirement forum. I can understand if u have a single income family with kids and want term life til you FIRE but 30 year term is just as much a waste as complete life

Good point.  The way I look at it the 30 term is to help bring any loss of future income as well as help with the estate taxes.  Asides from the other assets I leave this term policy will the the last lump sum income I will provide to my loved ones.  To me leaving a legacy to my loved ones is second to early retirement.   Your mileage may vary.

[sobezen]

I have mine with Fidelity.  They take credit cards.

Thanks.  I looked into Fidelity too and may apply with them.

[sobezen]

Do the math. If you assume a 5% (or whatever) rate of return on your investments, a guaranteed renewable 10-year term will probably be cheaper even if you continue to renew it for 30 years. I did some insurance shopping about a year ago and found that in nearly all cases less insurance resulted in me ending with more money.

I used State Farm, but that was because I can walk there from here and already had insurance with them.

Perhaps I am confused.  I will need to research the rates for a guaranteed renewable 10 year term and see if it actually more affordable than a 30 year level term that is fixed.  Do you have specific companies you can recommend that actually worked out cheaper?  And did any accept credit card payments?  Thank you.

[Goldielocks]

@ goldielocks:  Currently my parents are my dependents until I get married.  I am an only child, so I choose to help them.  They do not have LTC.  My permanent policy is expensive which is why I am lowering the face value by 20% that is the max you can lower for Transamerica per year.  And I am adding a 30 year term policy so it helps when things matter the most to the people I leave behind while my dependents need it the most.  If in the best case I never use the DB because I live, I am considering the LB (living benefit) offered by AIG which is still affordable compared to what other companies offer.  This way if I get into an accident (very high considering how much I drive), I can use the living benefit.  The permanent policy will remain in some amount which will help but not cover the estate tax issues I have.

I am still confused -- why do you need the insurance to extend past your working life?   
There is nothing more to protect after you stop working (e.g. your income, which your dependents rely on).

[boarder42]

1. you shouldnt be worried about estate taxes if you are then you dont need life insurance.

2. go create an account at SSA.gov and look at the piles of money your family would be left with when you die.  my wife and future unborn child would be left with 48k a year til the child was 16 .. and 24k til the child was 18. 

3. if this still isnt enough then figure out what you reasonably think is and limit that term based on when you think your savings plus number 2 will be more than sufficient.

also many jobs offer some form of life insurance mine is 2 years pay.

[sobezen]

And why are you worried about estate taxes?  The federal limit for estate tax is currently incredibly high -- 5 or 10 million?  Does CA have ridiculous estate taxes?  It doesn't really matter even if they do, because estate taxes are paid by the ESTATE.  If your parents have significant assets when they die, the taxes will be paid via the probate process before the money gets to you as their heir.

If you are worried about your parents not having sufficient funds to live out life comfortably if you die before they do, don't forget that you can also leave your retirement accounts to them as beneficiaries.  I guess if you want additional life insurance to supplement that you can, but it seems overkill to me. 

Anybody who is well on their way to amassing a significant FIRE stash really has minimal need for life insurance -- for kids/surviving spouse don't forget they would get the social security survivor benefit as well as your remaining assets.  In our case that would be over 3k/month.  You can ask for your social security record summary to see what you would get for spouse/children.  This would not take care of your parents, though, unless they are legally your dependents for some reason.

Yes we're in the estate tax range.  And yes my parents are listed as my primary beneficiaries.  In the future I may update a living trust to add a partner or spouse as a contigent beneficiary.  I am not factoring in SS as part of my estate or for beneficiaries, if they get anything from SS it will be gravy.  Legally my parents are not listed as dependents but that is all subject to change very quickly since one is 80+ and another is 70+.  I know my perspective may seem like overkill or excessive but the way I look at the term insurance is, even if I can completely self fund my own retirement, I want to leave additional resources to my loved ones.  I may consider adding a private fiduciary to help execute my wishes.

[boarder42]

so you're going to buy some insurance when you already have assets north of 5MM to give your heirs some "extra" money.  this thread is a waste of time in this forum.

[sobezen]

@boarder42:  Thank you for sharing your previous comments but your last one was frankly rude and uncalled for.  The only reason why my family has that amount is b/c of two properties, which they earned.  They will probably sell one to help pay for medical expenses and continue to reside in the other b/c one parent has an existing health condition not covered by insurance and has been experiencing on-going hospitalization (six times already this year).  And the expenses are not affordable it all, it has to be self-funded.  Another one of my parents does not have or qualify for LTC since she is already showing health issues.  If you know anything about self-funding skilled nursing care it can easily run north of 60k per year if required.  We are almost at this stage.

More importantly, none of my parents money is my money until they pass and decide to leave some (if any) to me.  I've had discussions with them and they told me do not count on it.  So I feel I am doing the responsible thing by caring for my family.  Perhaps we have a difference in opinions, but FIRE alone is not a reason to practice Mustachian values.  We are frugal and worked very hard for over 40 years to accumulate what we have earned.  I feel I am taking responsible steps to help my parents and future family.  Feel free to disagree but kindly refrain from passing judgment and being an ass about it.  We are all here to learn and voluntarily share.  If you feel otherwise, you are not obligated to share.  Thank you.

[Goldielocks]

OP -- your posts are getting a little more bizarre for me, as the thread goes on.

Did I read that correctly -- your parents have $5M (or a smaller but still hefty sum), but are in need of you to provide for their long term care?

In most realities, in their old age / need,  you would be providing emotional support, hands-on care  / visits, maybe power of attorney or living will trustee, but would NOT be on the hook for providing for them.  (as they have the funds to do so, you may simiply be called upon to help write the cheques for their benefit / need).

[sobezen]

Not sure what's bizarre if people own properties in CA they can easily reach the estate tax threshold.  This is not liquid cash and if their largest asset are two houses why wouldn't they still require help?  I am not in 'need' to provide for their long term health care, I WANT to help.  Is wanting to help my only living relatives a crime?  In some cultures demonstrating this level of consideration and forethought is actually appreciated.  SMH.  The other part is I am dating and when I find the right partner I want to proactive plan and leave her and our child with something.  I do not own property, I rent and my income is extremely unstable.  So if nothing else this term policy will provide the last lump sum payment to them.

[Goldielocks]

Not sure what's bizarre if people own properties in CA they can easily reach the estate tax threshold.  This is not liquid cash and if their largest asset are two houses why wouldn't they still require help?  I am not in 'need' to provide for their long term health care, I WANT to help.  Is wanting to help my only living relatives a crime?  In some cultures demonstrating this level of consideration and forethought is actually appreciated.  SMH.  The other part is I am dating and when I find the right partner I want to proactive plan and leave her and our child with something.  I do not own property, I rent and my income is extremely unstable.  So if nothing else this term policy will provide the last lump sum payment to them.

Accumulating that amount is not bizarre.  What is bizarre is that in the event that they need help, instead of helping them to sell one of the homes (and emotional/ daily living supports), you would feel responsible for the CASH of the LTC bill.

Who on earth in LTC needs to own two homes?   I can understand one, with one of the two parents in LTC and one at home (um, maybe in an extreme example) , but..but...but..?   

Is wanting to help my only living relatives a crime?  Not a crime, but paying for something for another, that they can clearly afford themselves is treating them like a child, and taking away so much more of their independence than needful, at  a time when they are likely to be worried about approaching dependency in their lives.


I want to proactive plan and leave her and our child with something.

Sounds great, but... you WILL be leaving something -- all of your earned and saved monies.   And your child will be quite old in 30 years, even if not born in 5...   That is why I think a 10 or at most 20 year life insurance is much better for you... Time it to when your income will stop, and you will be 100% fully protect (and overprotected as the years advance and you continue to save).;

Bizarre:

You need to be strict about the "principal" of monthly charges and not wanting to pay annually, (on principal), and  worried about the increased or non-available CC...or fees (which should be a minor inconvenience to you by now, and relatively small charge)  Versus wanting to IMO, grossly overpay to have life insurance through your 60's to age 70+.


Memo to sobezen -- Life insurance was not really INTENDED for 60 year olds plus, only for those in dire circumstances through not saving and having small dependents....   because the chance of dying is greater after age 60!!!  Result -- VERY high fees.