Life insurance shopping advice

Our step-by-step guide to buying life insurance, from completing the application to signing the policy, as well as how claims and riders work.

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The typical life insurance experience

Life insurance is one of the most critical purchases you will ever make, but it doesn't have to be painful or drawn out. Here's what to expect from a typical term life insurance policy, from buying the policy to making a claim.

Determine your coverage needs

The first thing you have to do is figure out how much coverage you'll need.

We recommend what's called a "needs based approach" because it provides a more accurate estimate of your total needs than other methods. You can use our Insurance Checkup (TM) as a one-stop-shop to get a personalized report of your total insurance needs, including what you still need and what you don't. This will also include a needs based estimate of your suggested life insurance coverage amount.

Comparison shop

Once you know the amount of coverage to buy, start looking at specific life insurance policies.

It's good to keep a few things in mind while you're shopping:

  • Steer clear of sites or agents with high-pressure sales tactics. Everyone knows it's better to buy life insurance as soon as possible, but during this phase, you should be taking your time to do an apples-to-apples comparison of plans (which is why we've built a quoting platform that automatically does just that).

  • The policy with the cheapest premium isn't automatically the best value once you factor in different policy features. Also, if you have a health issue (for example, you're a smoker) or a unique case, certain insurance carriers may provide more competitive pricing than others. Make sure that the life insurance quotes you get are for your specific health status. (Tip: If a site doesn't ask for any details about your health conditions before giving you a quote, you can be pretty sure that quote is nowhere near accurate.)

  • If a quoting site asks for your phone number before showing you a quote, that probably means it's going to add your contact information to a list of leads that it can sell to other companies or agents. If you want to avoid that, use a site like Policygenius that will show you a quote anonymously if you wish.

  • Prices vary even for nearly identical policies, so don't settle for the first quote you receive. Let an agent or broker work with you to tease out the differences so you can pick the best one.

  • Consider the company's rating when making a decision. You can ask the company directly, or do your own research on sites like Moody's, Standard and Poor's, Fitch, A.M. Best, or Weiss.

Submit application and complete medical examination

When you apply for a term life insurance policy, the insurer will look at your health, your lifestyle (for example whether you engage in risky activities), your family's health history, and other aspects of your life to determine the right premium amount. This is called underwriting.

This part of the process can seem intimidating if you've never gone through it before, so here's what to expect from your life insurance medical exam.

If you're shopping for insurance but you're in poor health, you might be able to avoid a medical exam entirely by either joining a group plan through your employer, or by purchasing "guaranteed issue" life insurance from a broker like Policygenius. Although it's easier (and faster) to buy than term life, guaranteed issue life insurance offers much smaller death benefits and is typically available only for shoppers in certain age groups (for example, age 50 through 80). Here are some other pros and cons of guaranteed issue life insurance.

The policy coverage period begins

After the insurance underwriter has reviewed and approved your application, you have to sign the policy (because it's a contract) and pay the first premium. This puts the policy into effect. Meaning: you're covered!

Most policies have a contestability period of two years, during which time the insurer can cancel the policy if it discovers that you've misrepresented something on your application. After the first two years, the insurer can still make adjustments to the policy if it finds out you gave the wrong information.

Periodically review your coverage needs

Every three years, and especially each time a major life event happens (e.g., marriage, birth of a child, home purchase), you should compare your current financial obligations against your policy to make sure you're still adequately covered for the right length of time.

If you find you're over-insured, you can shop around to see whether there's a cheaper product. If you're under­insured, you can look for a new policy with more coverage, or if your plan came with a guaranteed insurability provision you might be able to add more coverage without having to re­apply.

The policy ends

There are a few scenarios that can happen at the end of your policy:

  • With a term policy, the coverage will stop on the policy's end date. If you've been making the necessary adjustments to your coverage over the years (see above), then when this happens you'll no longer need a life insurance policy, either because you no longer have large financial obligations or because you've built up enough savings to cover them yourself.

  • If you die while the policy is in effect, then the insurer pays the full death benefit to whomever you've named as the beneficiary.

  • If at any time during your policy you stop paying the premium, your policy will be canceled by the insurer. This is called lapse. Most policies will have a 30-day grace period for paying your premium (which you should do, instead of having to get a new life insurance policy, because life insurance gets more expensive the older you get and the worse your health status gets).

Need­-to-­know policy features

Policygenius has done the research on life insurance. Here's what we recommend for a typical life insurance policy.

What to buy

Buy a term policy


A term policy is easier to understand and more affordable than permanent policies like whole, universal, or variable. For most people it's smarter to buy basic life insurance protection and place your retirement savings elsewhere.

For how long?

Buy a policy length of 5 or more years


Some term policies are as short as 1 year, with an option to renew at the end of the year. But there's a good chance the premium will increase with each renewal. Also, since most people need coverage that lasts longer than a year, you should look for a policy that will last for the full length of time you want coverage. In other words, if you want to cover a student loan debt that you know will take 10 years pay off, don't buy a policy for 5 years with the intention of buying another 5-year policy after that. You can get better rates the younger you are, so a new policy will be more expensive 5 years from now.


Be careful---you don't want to buy more than you need! If you have 20 years left on your mortgage and your children are already in grade school, a 30 year policy could mean you'll end up paying for an extra 5-10 years of coverage for expenses that no longer exist. Using the Policygenius life insurance quoting engine will help you determine the level and length of coverage you need based on your financial and personal situation.

Keep costs steady

Buy a policy with a "guaranteed level premium" provision


A "guaranteed level premium" policy means that the premium will remain the same---that is, "level"---for the duration of the policy. It's usually better to choose that over a policy where the premium increases over time. One way of looking at this is to look at similar options with home mortgages. You can choose a standard 30-year mortgage or a "balloon" mortgage where the payment increases after the first years. But the problem with a balloon mortgage is that it's hard to predict the future so far in advance, and in particular, people naturally tend to make mistakes when predicting future income. You don't want to risk losing your life insurance policy in 5 or 10 years because suddenly you can't afford the premiums. Stick with a guaranteed level premium to avoid any surprises.

Avoid extra approval periods

Buy a policy with a "guaranteed renewable" or "guaranteed insurability" provision


When a policy offers "guaranteed insurability," it means you can periodically adjust the amount of coverage you need without having to undergo a second (or third, or fourth) medical examination.


This is good for younger shoppers, but it usually isn't an option once you turn 40.

Keep surprises at bay

Choose an "entire contract" policy


"Entire contract" simply means that only the application and the medical exam are used to determine the price of the policy---and that the insurer can't come back later and make adjustments by citing information it finds somewhere else.

Protect your coverage

Make sure your policy has an incontestability provision


This guarantees that after an initial period of time (commonly 2 years), the insurer can't cancel the policy as long as you pay your premiums as agreed. Keep in mind, though, that the insurer can still modify the policy at any time if it discovers that you've misrepresented yourself on the original application.

Plan for billing mistakes

Make sure your policy has a grace period


Most policies include a grace period for premium payments---usually a 30 day window after the due date, during which time if the payment is made then the coverage will remain in place.

Where this really matters is in cases where the policyholder dies close to a premium due date and misses the final payment. The grace period offers the survivors a little breathing room to identify the oversight and make the payment so that the policy isn't terminated.

Keep your options open

Make sure your policy can be converted to a permanent policy just in case


There are instances where your health or financial situation changes such that it would actually make better sense to convert your term policy to a permanent one. It's unlikely, but it's still better to have that option.

Things to consider carefully

Many insurers will offer a selection of riders to augment your policy, but for most people these aren't worth the extra money. You might also find that some insurers include them at no extra cost, so keep that in mind when comparing plans

Accelerated death

What it does

If you're diagnosed with a terminal illness, this lets you access your death benefit while you're still alive so you can use it to pay for medical expenses.

When to consider it

Some policies will include this by default, while others may charge extra for it, so be sure to check on this when you're comparison shopping.

Annual renewable term

What it does

Year-by-year policy where you renew annually. Your premiums will go up each year.

Reentry renewable term

What it does

Offers cheap premiums but will raise premiums, sometimes significantly, if you don't meet specific health requirements when it's time to renew.

Accidental death & dismemberment

What it does

Pays extra if your death is caused by an accident listed in the AD&D rider, or if you lose a limb, go blind, etc.

Why you should avoid it

Unless you work in a high-risk profession, it's not worth the extra cost. AD&D riders are designed to provide a very narrow range of extra coverage, and insurers rarely have to pay claims on them. Make sure your main policy provides adequate coverage.

Waiver of premiums

What it does

Waives your premium payments if you become disabled for a long-term period.

What else to consider

If you can't pay your life insurance premium due to a disability, it's likely that there are other bills you can't pay as well. It makes sense to buy long-term disability insurance, in addition to your life insurance, to help cover all of your monthly expenses during a disability.

Child protection rider or child life insurance

What it does

Pays a death benefit upon the death of a child.

Why you should avoid it

Life insurance is about replacing lost financial support, which usually does not apply to children.

Decreasing premium

What it does

The death benefit shrinks over the life of the policy, either at a set rate or at a rate that matches your mortgage.

Why you should avoid it

You can get better value and more flexibility from other types of term policies.

The application process

What to expect from the application process

Total Application Time

5-6 Weeks

The entire application process generally takes 5-6 weeks. The common cause of longer processing times is an applicant with a complex health history, whose doctor needs to submit medical records to the insurance company. For a detailed breakdown, read our blog post Here's exactly what you need to do to buy life insurance.


20-25 ​min

What to expect

  • Fill out a 2-page application covering basic info and job details.

  • Be prepared to provide income documentation, either your latest tax return or employment offer letter (if changing jobs).

  • Sign authorization forms for release of health information to the insurer.

Medical Exam

30-45 ​min

What to expect

  • A paramedical technician will come to your home or workplace, as scheduled

  • The technician will measure your height, weight, blood pressure and pulse.

  • The technician will also take a blood sample and urine sample. (Some insurers might not require this step if the benefit amount requested is below a certain amount.)

Some tips to prepare for your medical exam

  • Schedule the exam for early in the morning.

  • 24 hours before the exam

    • Avoid caffeine, sugar, and alcohol.

    • Avoid over-the-counter drugs as they might interfere with your test results.

  • 6-8 hours before the exam

    • Don't eat anything else until you've completed the exam.

    • Don't engage in any strenuous exercise.

  • 1 hour before the exam

    • Drink a glass of water to help ensure you'll be able to provide a urine sample.

What happens next

The results of your exam (including the blood profile and urine screening results) will be submitted to the insurer's underwriters. Additional medical records may be requested from your physician(s), as necessary.

Phone Interview

20-25 ​min

What to expect

  • An insurer representative will call you, as scheduled, to ask about your lifestyle (e.g., travel & hobbies) and health history.

  • Your broker should provide a list of the questions beforehand so you know what to expect.

  • Have the name, address and phone number of your primary care physician handy.

Underwriting and Approval

2-4 weeks

What to expect

  • Assuming everything is in good order with both your medical exam and your phone interview, your case will go to underwriting for final approval.

  • Depending on your health status, the insurer may contact you to ask for more information or to request additional medical records, which can extend the underwriting time.

  • When the policy is ready, your broker (or the insurer) will deliver it to you. You'll have to sign a delivery receipt and authorize the payment method to activate the policy.

Policy Goes Into Effect

What to expect

  • Once your application is approved, the insurer will notify you and request payment. You may be given a binder, which is a certificate of proof that your policy is in effect while you wait for the official policy to arrive.

  • Store your policy and a copy of your application with your other important documents so you'll be able to reference it in the future. You should also make sure your beneficiary knows about the policy and has access to it.