Term Life Insurance Articles
How Your State Insurance Law Can Affect Term Life Insurance Quotes
2010-02-12
There are a number of factors at play when insurance companies figure term life insurance quotes for their customers, and most of these factors are based on annuity tables and the lifestyle, age, and sex of the policy holder. However, insurance law certainly has a big effect on the cost of individual policies, and many consumers don't realize this when shopping for a term life insurance policy. Understanding the role that insurance law--and particularly, state insurance law--plays in a policy's cost can help you find lower rates and better coverage, and avoid potential problems with payouts.
For instance, exclusions in an insurance policy are often regulated by state law in order to prevent unfair arrangements between insurers and their clients. Exclusions can prevent payouts in a variety of situations, for instance when a policy holder dies due to an accident at work or a preexisting medical condition. Sometimes, exclusions can be built into a plan to be so limiting that a payout is practically impossible, which is why some sort of legislation is important. However, any legislation that causes an insurer to pay out on more policies almost inevitably leads to an increase in term life insurance premiums for policy holders across a state. State insurance law may also prevent companies from denying coverage to certain age groups and ethnicities, and may put caps on the maximum amount that insurers can charge for coverage.
Many states also have genetic nondiscrimination laws that apply to the tables that insurance companies use when deciding a term life insurance quote. These laws prevent your insurance premiums from rising due to genetic testing and in some cases, family history of serious diseases (however, preexisting condition exclusions may still apply). These can also have a large impact on average insurance premiums, although the precise amount of increase can be difficult to measure, as there are a number of factors at play when term life premiums vary from state to state.
Of course, life insurance laws vary greatly from state to state, and the best way to understand how the law affects your policy is to contact your state insurance office and ask for some information about term life insurance policies. This info is also often available on government insurance websites. If you believe your term life insurance company is violating the law, you should contact your insurer and discuss any issues, but be ready to contact the state if necessary to file a complaint. Understanding the law is essential if you're buying a term life insurance policy--otherwise, you might not have a very secure policy, and death exclusions may prevent benefits.
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There are a number of factors at play when insurance companies figure term life insurance quotes for their customers, and most of these factors are based on annuity tables and the lifestyle, age, and sex of the policy holder. However, insurance law certainly has a big effect on the cost of individual policies, and many consumers don't realize this when shopping for a term life insurance policy. Understanding the role that insurance law--and particularly, state insurance law--plays in a policy's cost can help you find lower rates and better coverage, and avoid potential problems with payouts.
For instance, exclusions in an insurance policy are often regulated by state law in order to prevent unfair arrangements between insurers and their clients. Exclusions can prevent payouts in a variety of situations, for instance when a policy holder dies due to an accident at work or a preexisting medical condition. Sometimes, exclusions can be built into a plan to be so limiting that a payout is practically impossible, which is why some sort of legislation is important. However, any legislation that causes an insurer to pay out on more policies almost inevitably leads to an increase in term life insurance premiums for policy holders across a state. State insurance law may also prevent companies from denying coverage to certain age groups and ethnicities, and may put caps on the maximum amount that insurers can charge for coverage.
Many states also have genetic nondiscrimination laws that apply to the tables that insurance companies use when deciding a term life insurance quote. These laws prevent your insurance premiums from rising due to genetic testing and in some cases, family history of serious diseases (however, preexisting condition exclusions may still apply). These can also have a large impact on average insurance premiums, although the precise amount of increase can be difficult to measure, as there are a number of factors at play when term life premiums vary from state to state.
Of course, life insurance laws vary greatly from state to state, and the best way to understand how the law affects your policy is to contact your state insurance office and ask for some information about term life insurance policies. This info is also often available on government insurance websites. If you believe your term life insurance company is violating the law, you should contact your insurer and discuss any issues, but be ready to contact the state if necessary to file a complaint. Understanding the law is essential if you're buying a term life insurance policy--otherwise, you might not have a very secure policy, and death exclusions may prevent benefits.
