How to Buy the Most Suitable Insurance Product?(1)
Purchasing life insurance is a very complicated process, as insurance sales will give you a variety of great promises and paint a beautiful picture, and because insurance conditions are generally very complicated, it is difficult for laymen to fully understand the relationship between them. Therefore, when you choose to purchase life insurance, you must first understand the purpose of purchasing life insurance, in case, or to leave an inheritance for your child, or both.
If this is just in case, to provide stable protection for the family, then term life insurance (term life) is most appropriate. And general term life insurance will have a conversion clause, which can be converted to life insurance.
If you take into account the needs of tax evasion and inheritance, you can consider the entire life, universal life and variable / indexed universal life (VUL / IUL). However, it should be noted that these three life insurances combine insurance and cash investment functions, so you must also take into account your own risk tolerance and willingness to risk.
For term life insurance, since it is already a very mature product, the horizontal comparison of the different companies is relatively simple. With the development of the Internet, various free inquiries are relatively transparent. Several points to compare are relatively simple.
1 Premium
In other identical conditions (for example: period of validity of insurance, status of medical examination, sum insured, etc.), the lower the premium, the more attractive it is.
2 Financial situation of insurance companies
If the term of the term insurance is longer, the more you need to take into account the financial situation of the insurance company. In general, the corresponding information can be obtained through the ratings of Moody's, S&P and A.M. Best.
3 If the premium is fixed
The premiums of some insurance companies are not fixed, that is, they can be adjusted to new premium rates at any time thereafter. Therefore, when the two insurance companies are otherwise identical, if the premium can be fixed, it is relatively more advantageous
4 Updates of insurance conditions
Different insurance companies will provide different insurance renewal fees. So even if the costs and insurance conditions of the two companies are completely identical in other respects, the cost of updating the insurance conditions can be very different.
5 Conversion of term life insurance into permanent life insurance
Certain term life insurance products of certain insurance companies will provide conditions for the conversion of term life insurance to life life insurance, while some insurance companies will not provide corresponding conditions for certain products term insurance. So, when comparing different lifetime products, it is more interesting to offer products with conversion terms.
6 health insurance clauses
Each insurance company has different requirements for medical exams, especially for people who smoke / quit smoking. Therefore, after the medical examination, you can ask different insurance companies to compare the prices.
For the other three types of cash value insurance, the horizontal comparison between different companies is relatively difficult. On the one hand, because of the complicated and obscure regulations of the insurance company itself, and on the other hand, because the sales of the insurance company are mainly based on the communication between the sales staff and the customer, Therefore, to compare the products of different insurance companies, you need to contact the sales staff of different companies, which is time consuming and labor intensive. Nevertheless, the most basic points of comparison are still traceable, that is to say insurance costs, investment strategies and dividend income / investment policies.
