There are over 700 life insurance companies in business. Here’s how to find the right one

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It is important to do your research when shopping for life insurance.

Main points

• Finding the right company for your life insurance needs is very important.
• There are various steps you can take to narrow down your choices.
• Find customer reviews, ask for recommendations from people you know, and compare costs for policies.

When it comes to buying life insurance, you often feel the need to shop around for coverage rather than going with the first insurance company that hits your radar. Shopping locally can result in lower, more affordable premiums that make your policy easier to manage financially. And since you may be paying those premiums for decades, that’s important.

But choosing the right life insurance can be challenging. In fact, the American Council of Life Insurers reports that by the end of 2021, there were a whopping 737 life insurance companies in business across the US. That is. Lots of options to sort. But you can make the process easier on yourself by following these tips.

1. Ask for recommendations

Do you have friends or neighbors who have life insurance? If you’re happy with their coverage and find it affordable, it won’t hurt to ask who insures them and get quotes yourself.

Of course, the amount you pay for life insurance depends on many factors. These include your health condition, the number of years you will be purchasing cover and the amount of cover you need. After all, a $1 million life insurance policy is worth more than a policy with a $250,000 death benefit.

Also, your version of “fair” may differ from that of your friends or neighbors in the context of life insurance. But it’s still a good idea to ask for recommendations.

2. Rely on their names

You want to sign up with a financially stable life insurance company. And the major insurers may be more likely to meet that bill.

That’s not to say that a life insurance company you’ve never heard of is a poor choice. But there’s a reason why some life insurance names are more familiar to you than others. And that familiarity is something you can take comfort in.

3. Check customer satisfaction ratings

Hearing what current life insurance customers have to say about their insurers may sway you to choose one over the other. If you have a list of companies to consider, run these names through the National Insurance Commissioners database and see what kind of customer feedback comes up.

4. Compare your expenses

After narrowing down your choices, you can get quotes from different life insurance companies. If you are talking about the same level of coverage, cost should definitely be a factor in choosing one insurer over the other.

If one life insurance company is writing you a 30-year, $1 million life policy for $1,000 per year and another is offering the same policy terms for $1,500 per year, why not go with the more expensive option (if you have one; no worries about the insurer’s finances)?

Choosing a life insurance company is not easy. But the more research you do, the more likely you are to find cost-effective coverage.