We're going to
try and address the different types of term life
insurance carriers without strange terminology and
eye-glazing verbiage. Like we said...we'll
try. The term life market is such that the
type of insurance carrier isn't so much of a concern
but for those that are brave and intrepid
enough...let's look at the different types of
Again, term life
insurance has really become a commodity over the
past decade. This is great news. It
really narrows the decision making to cost, amount
length of term, and
the financial strength of your term life insurance
carrier. Whether your carrier is structured as
a Stock or Mutual carrier becomes less of an issue
as the ability of that company to pay benefits
during the course of your chosen term. That
being said, let's look at the types of carriers.
Insurance Company. This is model is your
typical insurance company listed on stock exchanges.
The stockholders fund the capital to offer life
insurance policies to members and expect to make a
profit typically in form of dividends. The
stockholders are usually not policy holders and the
venture is primarily driven by a profit motive.
This is not necessarily a negative as your primary
concern is to find the best-priced life insurance
policy with a
carrier through our
term life insurance quoting
tool. This may be a Stock life
insurance company model in the end.
Insurance Company. This model is structured
quite differently although it can also be a
corporation. With the Mutual Life model, the
policy holders essentially own the company.
The company is not in business to make a profit.
There is a board of directors that manages the
affairs of the company but any additional money
collected in the form of premium above what is paid
out as benefits will be returned to the policy
holders as "over-charged" premium.
These are the
two large models for life insurance carriers.
There is not really a benefit to a person
term life insurance between the two models. It
really depends on your particular situation (age,
amount, length of term) as for a given person, one
carrier may be superior over another one (regardless
of type of carrier).
plans. The government is less of a factor in
the term life insurance market as compared to other
types of insurance (health, disability, etc).
Government usually comes into play where there is
little market for private (be it Stock or Mutual)
insurers. Health insurance for people over age
65 is a prime example. Health expenses tend to
double with each decades of a person's life.
Qualifying for health insurance would likely be an
issue for many older Americans or the cost would we
prohibitively expensive. Life insurance, so
far, hasn't fallen under the increasing arm of
other types of insurance carrier such as Reciprocal
and Lloyd's of London but these are not as
significant in the term life insurance market.
Again, we recommend other factors to consider when
purchasing term life insurance
than the type of insurance carrier but we aim to
provide all the information to you.