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How to get life insurance: 7 steps to buying the right policy

Shopping for life insurance coverage doesn’t have to be complicated. Learn how working with an agent makes it easy to apply online and get affordable life insurance for your family.

Rebecca Shoenthal author photoAmanda Shih author photo

By

Rebecca Shoenthal

Rebecca Shoenthal

Editor & Licensed Life Insurance Expert

Rebecca Shoenthal is a licensed life, disability, and health insurance expert and a former editor at Policygenius. Her insights about life insurance and finance have appeared in The Wall Street Journal, Fox Business, The Balance, HerMoney, SBLI, and John Hancock.

&Amanda Shih

Amanda Shih

Editor & Licensed Life Insurance Expert

Amanda Shih is a licensed life, disability, and health insurance expert and a former editor at Policygenius, where she covered life insurance and disability insurance. Her expertise has appeared in Slate, Lifehacker, Little Spoon, and J.D. Power.

Expert reviewed

Expert reviewed

This article has been reviewed by a licensed Policygenius expert to ensure that sources, statistics, and claims meet our standard for accurate and unbiased advice.

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By

Matt Burke

Matt Burke

Licensed Insurance Expert & Director of Life, DI and P&C Operations

Matt Burke is a licensed insurance expert and the director of operations for life, disability and property & casualty insurance at Policygenius. Matt has worked in the insurance and financial planning industries for more than seven years, and is a Life, Accident & Health licensed insurance agent.

Updated|7 min read

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Life insurance creates financial protection for your loved ones if you die unexpectedly, but finding the right policy can be confusing. We outlined seven easy steps below to help you make important decisions and get life insurance with ease: from determining how much coverage you need to selecting the type of policy and comparing quotes. 

Key Takeaways

  • Working with an independent broker can help you find the most affordable provider.

  • Underwriting usually includes a phone call and medical exam, though some insurers and products waive the medical exam.

  • The application process can be completed mostly online if you get no-medical-exam life insurance.

  • You do not officially have coverage until you sign your final policy documents and pay your first premium.

1. Calculate how much life insurance you need

Life insurance coverage should be customized to your family’s long-term financial needs, including projected income, debts, expenses, and the needs of your dependents. Policygenius experts suggest 10 to 15 times your annual income in life insurance coverage to support these costs for your family. You can use our calculator to tally up how much coverage you need or reach out to a licensed agent who can help you do the math.

Tally up your financial obligations

Adding up the costs below will help you get a sense of what your family will need if you’re gone. Your death benefit should encompass that entire dollar amount minus any liquid assets you already have. A typical breakdown might look like this:

ResourcesNational average
Income$55,628
Assets$121,700
Total assets$177,328
ExpensesNational average
Annual household expenses$61,334
Cost of raising two children for 18 years$569,140
Cost of a 4-year public university for two children$345,288
End-of-life expenses$7,000
Total expenses$982,762
DebtNational average
Credit card balance$5,313
Auto loan$35,200
Mortgage$423,102
Total debt$463,615

The costs above are based on data compiled by Experian, the Federal Reserve, the Bureau of Labor Statistics, the Social Security Administration, the USDA, and Education Data and are based on median data for U.S. consumers. Numbers will vary depending on each person’s individual circumstances.

Recommended coverage example

  • Total financial obligations (Expenses + Debt): $1,446,377

  • Coverage gap (Total financial obligations - Assets): $1,269,049

  • Recommended coverage amount: $1,300,000

If you have multiple life insurance policies, how much you need may look different and you should consult a financial advisor.

→ Learn more about how to determine how much life insurance you need

2. Decide what type of policy you need

After evaluating the amount of coverage you need, you can decide if you should buy a term or permanent life insurance policy. Term life insurance is the best option for most people — it’s easy to manage and offers the most coverage for the lowest dollar amount. But there may be circumstances where you need a permanent life insurance policy — for example, if someone will depend on your financial support for life.

If you’re considering purchasing life insurance as part of your investment portfolio or estate planning strategy, certain types of permanent life insurance policies, including whole life insurance or indexed universal life insurance, can be an option for you. 

Types of Life Insurance graph

A Policygenius agent can help you decide on the best policy for your budget and coverage needs.

→ Find the best type of life insurance for your needs

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3. Shop around for a life insurance policy

Once you have an idea of the type of coverage you need, the next step is to decide where to buy life insurance. An overwhelming majority of people purchase their policy from an insurance agent or broker [1] , but you can also purchase it through a financial advisor, an organization, an employer, or directly from an insurance company. Brokers represent you and tend to offer more impartial advice, while agents represent the insurer’s interests. 

Insurance rates are regulated by law, which means that no company, broker, or agent can offer you a discount on a policy. But because each insurer calculates risk differently, you’ll pay the most affordable premiums by shopping around with multiple insurers as opposed to working with just one. According to a study conducted by LIMRA [2] , an independent research trade association, over a quarter of life insurance buyers found that working with an agent eased the life insurance shopping process, and 97% of the applicants surveyed experienced satisfactory service.

To get the best pricing and most accurate information available across multiple insurance companies, we recommend working with an independent broker. At Policygenius, our brokers are licensed in all 50 states and can walk you through the entire life insurance buying process while offering transparent, unbiased advice.

→ Read reviews from customers to learn more about working with Policygenius

Buying life insurance from a broker vs an agent

Sometimes “agent” and “broker” are used interchangeably, but it’s important to distinguish them. Knowing the pros and cons of purchasing life insurance through each will help you find a policy that strikes the right balance between affordability and protection.

  • Independent brokers like Policygenius are not affiliated with any insurer and sell policies from multiple companies. They work on your behalf, following your application throughout the entire underwriting process, and shopping around for alternatives if your original application results in a higher premium than you were quoted or a decline. Working with a broker might take longer because they’ll have to compare quotes across different companies, especially if you present several risk factors for a life insurer to consider.

  • Affiliated agents, also called captive agents, are hired by one or more insurers to sell their products. You might feel more comfortable dealing with a local agent, especially if you’ve previously worked with them on other insurance products. Agents know their company's offerings and application processing times very well. Your options will be limited as agents only sell policies from the insurers they work for. And because they’re paid on commission, agents may have a financial incentive to sell you more expensive policies or more coverage than you need.

Where else to buy life insurance

There are other ways to purchase life insurance, which may only be available to you if you’re affiliated with a specific organization. Unless your organization offers multiple provider options — a rarity — the same advantages and disadvantages of buying directly from an insurance company apply.

  • Directly from an insurance company: Some insurance companies allow you to apply to their plans directly, but you’ll have limited options to choose from and you won’t get unbiased advice.

  • Through a financial advisor: Working with a financial advisor can help ensure that you choose a policy that fits your budget and your financial goals.

  • From an organization: Many employers or other organizations, like credit unions, offer group life insurance, in some cases at no cost. Group policies usually offer limited protection, so you’ll probably need to purchase your own policy to meet your coverage needs.

Compare life insurance quotes and companies

You can get a free sample quote from many different insurers with just a few pieces of personal information, like your location, age, gender, and basic medical history. 

Most people pick the cheapest policy that has the coverage they need, but it’s important to compare other features, like what riders, or supplemental coverage, a company offers, their customer service record and ratings from trusted third-party ratings agencies like A.M. Best, and whether they’re best for your particular health profile.

CompanyPolicygenius ratingBest for
Protective

4.9

Overall, Term life, Value, Customer satisfaction
Banner Life

4.7

People with health concerns
Lincoln Financial

4.7

No-medical-exam policies
Brighthouse Financial

4.6

No-medical-exam policies, Young adults, Fast approval, Customer satisfaction
Foresters Financial

4.2

Fast approval, Policy customization
Prudential

3.4

Older applicants

Not sure which company is the best fit for you? A licensed Policygenius agent can talk you through the options, help you compare quotes, and walk you through the application process so you can find the company — and policy — that works for you.

→ Learn more about the best life insurance companies

4. Complete the application process

The application requires a phone interview where you’ll be asked about your medical history, lifestyle, and other personal details. Life insurance companies do a thorough evaluation of your medical history and background, so if they find something you didn’t report, your actual premiums may look different than the initial quote you received.

Insurers also check your life insurance application history for any issues — like if you’ve ever been caught lying on an application — and confirm what you reported in your medical history against databases like the MIB

What questions to expect from your insurer

You may be asked to authorize your doctor to share your health information with the life insurance company, known as an attending physician statement (APS). This information is necessary to not only get you the correct policy but could also earn you more affordable premiums if you have a health condition but your doctor reports that you’ve responded well to treatment.

Additionally, you’ll be asked about your hobbies and financial health — including your income and net worth — as well as other life insurance policies you have.

What documents you'll need

You can make the application process as seamless as possible by having important information on hand before you apply for life insurance. None of the following documents are required to apply for life insurance but may help speed up the initial phone call. These include:

  • Proof of identity, citizenship, and age. A driver’s license, Social Security number, birth certificate, or a valid passport will work. Noncitizen residents can use their green card (permanent resident card) or an employment authorization card.

  • Proof of income. You can use pay stubs, a letter of employment, a tax return, or an earnings statement from your bank. If you’re unemployed, an unemployment letter or monthly statement describing your unemployment benefits will work.

  • Proof of residency. For renters, that could be your signed lease or a rent receipt. For homeowners, your mortgage bill or a property tax statement will suffice. Insurers will also accept a utility bill or a postmarked envelope with your return address on it.

Insurance companies do not collect any of the documents listed above, but having them in front of you will save time for you and the insurer.

5. Get a medical exam

If you decide to go the traditional route, you’ll schedule your medical exam after your phone interview. The life insurance medical exam is a free exam similar to a yearly physical, with an option for the medical examiner to come to your home or office.

If you opt for a no-medical-exam life insurance policy, then the insurer will continue to look into your medical history (you'll need to sign a HIPAA compliance waiver to give them access to your records) and reach out once they’ve decided on your policy.

→ Learn more about how the life insurance medical exam works

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6. Wait for the underwriting results

The hard part is over — now all you have to do is be patient. Underwriting, which encapsulates the application, phone call, and medical exam, is how the life insurance company evaluates the risk of insuring you and how much you’ll pay for your policy. Once it’s over, an underwriter will determine your health classification and final premiums.

This process can take five to six weeks, but sometimes longer if parts of your application require any supplemental documentation (like an APS).

→ Learn more about life insurance classifications

7. Sign the documents and pay for your policy

Once the underwriting process is complete, you’ll be issued a policy offer. If you agree to its terms, all that is left is for you to sign the policy documents and pay your first premium. Your policy isn’t in force until you do so — a policy offer from the insurer doesn’t mean you have coverage.

What to do with your policy documents

Depending on the insurer, your policy documents will either need to be electronically delivered or mailed back. Keep a hard copy and digital copy of your policy in a safe place and let your beneficiaries where to find it. If your beneficiaries don’t know about the policy, they won’t know how to claim the death benefit.

Getting life insurance can feel overwhelming, but if you know what to expect and work with a knowledgeable broker, you can get the coverage you need quickly and efficiently.

Frequently asked questions

How much life insurance should you buy?

Your life insurance coverage should be at least 10 to 30 times your income and enough to cover your debts.

Can you purchase life insurance online?

You can get a life insurance quote online, but most life insurance policies require a phone call with an agent, at the minimum, to get active coverage.

What is the best life insurance to buy?

Most people only need a term life insurance policy, but some individuals with long-term dependents or a high net worth are better off with a whole life insurance policy. An agent or broker can guide you toward the right type of policy for your needs.

Is it worth it to buy life insurance?

If you have dependents or anyone who would suffer financially if you died, life insurance offers important financial protection and is well worth the cost.

Where do I start with life insurance?

A licensed agent can help you determine how much coverage you need and what type of life insurance policy is best. They can also compare quotes across companies and even submit your application for you.