Questions to Ask About Life Insurance
For anyone buying a first life insurance policy or checking an old one, to ask an agent, a broker or the insurer directly. The questions follow the order the decision usually takes: the coverage amount, the type of policy, what it costs and who stands behind it, the application, riders and exclusions, then beneficiaries and claims. Each has a note on what a good answer sounds like and what should slow you down, and because the rules differ by country, state and insurer, many of them tell you to ask how it works where you are.
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The questions
Each question, and why to ask it
Coverage amount
Do I need life insurance at all, and who would it be protecting?
Why ask it
Start here, because the answer can be no. If nobody relies on your income or your unpaid work, a good agent says so, or suggests a small amount for final costs. Be wary of one who finds a reason for a large policy whatever you answer.
How much life insurance do I need, and how did you work out that number?
Why ask it
A useful answer starts from your own figures: the income to replace, the mortgage and other debts, the years until your children are independent, and the savings and coverage you already have. A multiple of salary offered before any of that has been asked is a sales shortcut. Have the arithmetic put on paper so you can change one assumption and watch the number move.
How long should the coverage last?
Why ask it
Tie the length to something that ends: the mortgage, the youngest child finishing school, the year you expect to stop working. If the answer is 'for life', ask which of your needs is lifelong. Pricing the same amount at two different lengths shows what the extra years cost.
Does the life insurance I get through work count toward what I need, and what happens to it if I leave the job?
Why ask it
Workplace coverage is often tied to the job, and whether you can take it with you depends on the employer and the plan. Your benefits office can tell you what happens on the day you leave and what continuing it would cost. Bring that answer to the agent, so the recommendation is not built on a guess.
Should my partner be insured too, even if they earn little or stay home with the children?
Why ask it
Listen for whether the agent prices the work that would have to be paid for: child care, driving, cooking, running the household. An answer that only counts paychecks will put the at-home partner's figure too low or at zero. Couples can ask for both quotes on one page before deciding.
Will this amount still be enough in twenty years, once prices have risen?
Why ask it
A payout fixed today buys less as prices rise, so a sum sized for now may fall short late in the term. Some policies let the benefit climb on a schedule or with an index, usually with a climbing premium; the other route is to buy somewhat more at the start. Get a price for each and decide which you could keep paying in year fifteen.
Would one large policy suit me, or several smaller ones that end at different times?
Why ask it
Layering policies can follow needs that shrink as the mortgage falls and the children grow up. The comparison that settles it is the total premium each way over the full period. If the agent waves the idea away without running the numbers, they may only be quoting the one product they know best.
Which changes in my life should send me back to review the amount?
Why ask it
You are hoping to hear a list: a new child, a larger mortgage, a divorce, a business loan, a big change in income. The better agents offer to rerun the calculation when one of those happens. If you are reviewing an old policy, this is the question to open with, because the number was set for a life you may no longer have.
Type of policy
What is the difference between term and permanent life insurance for someone in my position?
Why ask it
Term covers a set number of years and pays only if you die within them. Permanent policies such as whole and universal life are built to last for life and usually hold a cash value, at a higher premium for the same payout. A fair answer explains both and then says which one fits the need you described; if you hear only one side, ask what they would say against it.
If you recommend whole or universal life, what would the same death benefit cost as term?
Why ask it
Get both quotes for the same amount on one page. The gap between them is the price of lifelong coverage and the cash value, and seeing it lets you decide whether those are worth that much to you. Reluctance to produce the term quote is a reason to get a second opinion.
How does the cash value grow, and which part of that growth is promised in the contract?
Why ask it
Policy illustrations usually carry two sets of figures, one the contract promises and one that is only projected. Have the agent point to each and say which they would plan around. Projections rest on today's rates or dividends, and a careful agent says they are not promises before you have to ask.
With universal life, what happens if interest rates or the policy's charges move against me?
Why ask it
Flexible-premium policies can need more money later to stay in force when the early assumptions do not hold. Request an illustration run on the minimum assumptions, and find the age at which the policy would run out of money on that basis. A vague answer here is the strongest reason on this list to slow down.
What can I do with the cash value, and what does borrowing or withdrawing it do to the payout?
Why ask it
Loans and withdrawals generally reduce what your beneficiaries receive, and unpaid loan interest can build on itself. Pin down the loan rate, how it is set, and what happens if the loan grows past the value behind it. How any of this is taxed depends on where you live, so confirm that part with a tax adviser.
What happens when the term ends and I am still alive?
Why ask it
Coverage may simply stop, renew a year at a time at a new price, or be open to conversion, depending on the policy. Ask for the renewal premium as a figure, not a description. If you can already see a need running past the end date, say so now, because it may change the length you buy.
Can this term policy be converted to a permanent one later, and until when?
Why ask it
Conversion typically lets you move to permanent coverage without new medical questions, which matters most if your health changes. The deadline, the age limit and the policies you may convert into all vary by insurer. Get the clause in writing and put the last date in your calendar.
Does the death benefit stay level, or does it fall over time?
Why ask it
Decreasing policies are often sold alongside a mortgage and pay less each year. That can suit a loan that is being paid down and very little else. Have the payout in year ten and in year twenty written down, then compare the price with a level policy of the same length.
For the two of us, is one joint policy better than two separate ones?
Why ask it
A joint policy commonly pays once, on the first death or the second depending on its type, and then ends. With the first-death kind, that can leave the survivor looking for new coverage at an older age. Put its price beside two single policies, and find out what becomes of it if you separate.
For a permanent policy I already own, can you get me a current in-force illustration?
Why ask it
This is the document that shows where an existing policy stands today and how long it lasts on current and minimum assumptions. Insurers will generally produce one on request, though its name and layout differ. If it shows the policy running dry earlier than you expected, find out what premium would correct that while there is still time to act.
I have an older policy. What would I give up by replacing it with a new one?
Why ask it
A replacement can mean new health questions at an older age, a fresh contestability period, surrender charges on the old policy and a new commission for the person advising it. Ask for a written side-by-side comparison of the two. Whatever you decide, do not cancel the old policy until the new one is confirmed in force.
Cost and the insurer
Is the premium fixed, and if so for how long?
Why ask it
Have the agent show you the sentence in the policy document, not the quote. Some policies hold the price for the whole term and others can be repriced after a set period. 'It should not change' is a hope; a page reference is an answer.
What will I have paid in total by the end, and what would I get back if I stopped halfway?
Why ask it
Multiply it out together. For term the second half of the answer is usually nothing, which is fine when the price reflects it. For a permanent policy, get the surrender value at years five, ten and twenty, since the early years often return much less than was paid in.
Which health class is this quote based on, and what would it cost if I came out a class or two lower?
Why ask it
Quotes are often shown at the best health class, and not every applicant ends up there. Seeing the lower-class prices now keeps the real offer from arriving as a shock. An agent who asked about your health, family history and tobacco use before quoting has probably given you a truer number already.
Is it cheaper to pay once a year than every month?
Why ask it
Many insurers add something for monthly payments. With both figures in front of you, work out the difference over twelve months. If it is small, pay whichever way you are least likely to miss.
Are there charges inside the policy beyond the premium I see?
Why ask it
Mostly a question for permanent policies, where the cost of insurance, administration fees and surrender charges come out of the cash value. The illustration should list them on a page the agent can find, with a total for the first ten years. For plain term coverage the honest answer tends to be short.
What happens if I miss a payment?
Why ask it
Three things to pin down: the length of the grace period, how you will be warned, and whether a death during it would still be paid. With a permanent policy, also ask whether the cash value can cover a missed premium automatically and for how long. Give the insurer a second contact for notices if they allow one.
If the policy lapses, can I get it back?
Why ask it
Reinstatement often means back premiums with interest and new health questions, inside a time limit that differs by insurer. Find out that limit and whether the contestability period would start over. A discouraging answer is your cue to set up automatic payments on day one.
If money gets tight, what are my choices short of canceling?
Why ask it
Depending on the policy you may be able to lower the death benefit, drop riders, or switch to a smaller policy with no further premiums. Learn which of these exist before you buy. For an old policy you are struggling to keep, raise it while the premiums are still being paid, because a lapsed policy leaves fewer choices.
How many insurers did you compare for me, and why did this one come out ahead?
Why ask it
An agent tied to one company can only show that company's prices, while a broker should be able to name several and say where each landed. Ask to see the runners-up. If price was the only reason given, follow up with the next question on this list.
How financially strong is this insurer, and who rates it?
Why ask it
A life policy is a promise that may be collected decades from now. Get the rating and the name of the agency behind it, then look it up yourself. It is also fair to ask what protection exists where you live if an insurer fails, since those arrangements and their limits differ from place to place.
How are you paid on this policy, and is it different for the other products you showed me?
Why ask it
Permanent policies often pay the seller more than term does, which is useful context when one is recommended over the other. You are not asking for a discount, only for what sits behind the advice. Someone confident in the recommendation will answer without bristling.
Applying
What does the application involve, and will I need a medical exam?
Why ask it
Some policies ask only health questions. Others send an examiner to take blood and urine samples, your height and weight, and your blood pressure. Find out what will be tested and whether skipping the exam costs more for the same coverage, and have both prices before you choose.
What records will the insurer check besides what I tell you?
Why ask it
Depending on where you live, an insurer may look at medical records, prescription history, your driving record and earlier insurance applications. The agent should know which of these apply and what you will be signing to permit it. Hearing the list is the best argument for answering every question on the form completely.
Which of my health conditions, medications or family history will affect the price most?
Why ask it
Tell the agent everything before you apply, including the things you would prefer to leave out. Insurers weigh the same condition differently, and a good agent uses the full picture to choose where to send your application. One who suggests leaving something off the form is putting your family's claim at risk.
How do my job, hobbies, travel and any tobacco or nicotine use change the offer?
Why ask it
Flying, diving, climbing, certain occupations and travel to some countries can raise the price or bring an exclusion. Definitions of tobacco use vary as well: how vaping or an occasional cigar is counted, and how long ago you must have quit. Ask for each insurer's rule in writing instead of a general reassurance.
How long does approval take, and am I covered while I wait?
Why ask it
Some insurers give temporary coverage once you have applied and paid a first premium, with limits and an end date set out in a receipt you should read. Others give none. If there is no coverage in the gap, say so to anyone who is counting on it.
What happens if I am turned down, or offered a higher price than the quote?
Why ask it
You should hear a plan: the reason in writing, a different insurer, a smaller amount, a policy with fewer health questions, or reapplying after a change in your health. It is worth knowing too whether a decline is recorded anywhere that later insurers will see. A shrug at this question suggests the agent has not placed many difficult cases.
If my health improves or I stop smoking, can the price be looked at again?
Why ask it
Some insurers will reconsider a rating after a waiting period and some will not. The details to get are the proof they want and how long you must wait. Then set your own reminder, because the insurer is unlikely to prompt you.
After the policy arrives, is there a period when I can change my mind and get my money back?
Why ask it
Many places require a cooling-off window, sometimes called a free look, but its length depends on where you live and on the policy. Get the dates and the way to cancel within them. Spend the window reading the policy itself, which may be the first time you see the full document.
Riders and exclusions
What does this policy not pay out for?
Why ask it
Ask for the exclusions page and read it with the agent beside you. The list and the wording differ from policy to policy, and can include self-inflicted death in the early years, death during a crime, named hazardous activities and war. If you are told it pays for everything, ask again with the page open.
What is the contestability period, and what can the insurer do during it?
Why ask it
Many policies give the insurer a set time after the start in which it can go back over the application when a claim is made, and reduce or refuse the claim over misstatements. How long that lasts and what would restart it are in the contract, and the rules behind it differ by country and state. It is the reason an honest mistake on the form is worth correcting today, so ask how to amend an application that has already gone in.
Once the policy is in force, can the insurer cancel it or change its terms?
Why ask it
Have the agent list what the contract lets the insurer change, such as the premium, the internal charges or the interest credited, and what is fixed for good. Then get the grounds for cancellation, which are commonly unpaid premiums and misstatements on the application. Each answer should come with a clause you can read.
After the policy starts, do I have to tell the insurer if I change jobs, take up a risky hobby or move abroad?
Why ask it
Practice differs: some policies are priced once, on the day you apply, and others expect to be told or limit coverage in certain countries. Get the answer for this policy in writing. If you already know a change is coming, mention it before you apply, when it can still be priced in and not disputed later.
Which riders are available, and what does each one add to the premium?
Why ask it
Have each rider priced on its own line. Waiver of premium, an early payout for serious illness, coverage for a child or spouse and extra for accidental death make up the usual menu. Some come at no charge and others cost enough that separate coverage would be cheaper, so compare before accepting a bundle.
If I became too ill or disabled to work, would the premiums be waived?
Why ask it
That depends on a waiver of premium rider and on how it defines disability, which can be narrow. Find out how long you must be unable to work before it applies, whether it means your own job or any job, and the age at which the rider ends. Judge it by the definition, not the name.
Can I draw on the death benefit early if I am diagnosed with a terminal or serious illness?
Why ask it
Many policies offer some form of early payout, but the trigger, the share you can take and the fees differ. Ask which diagnoses qualify, who decides, and how much would be left for your beneficiaries afterward. Check as well whether taking it could affect any public benefits where you live.
Is an accidental death rider worth adding in my case?
Why ask it
It pays extra only when a death meets the policy's own definition of an accident, and that definition is the thing to read. If you need the larger amount, ask what it would cost to raise the base coverage instead, so the payout does not depend on the cause. Have the agent price both.
Is there a version that returns my premiums if I outlive the term, and what does it cost?
Why ask it
Where it is offered, a return-of-premium option raises the price, sometimes by a lot. Set the extra you would pay over the term against what comes back at the end, and check what is returned if you cancel or lapse partway, which can be little or nothing. If the plain policy plus your own savings comes out ahead, you have your answer.
Can I increase the coverage later without answering health questions again?
Why ask it
Some policies carry an option to buy more at set ages or after events such as a marriage or a birth. Its worth is in the dates, the amount that can be added each time, and what happens to an option you let pass. It earns its price if you are young and expect your needs to grow; if your family is complete, skip it.
Beneficiaries and claims
Who should I name as beneficiary, and should I name a backup?
Why ask it
Name a first choice and a second, with full legal names and shares that add up to the whole. Leaving the line blank, or naming your estate, can send the money by a slower route in many places. Ask what the insurer does if a beneficiary dies before you.
What happens if I name a child who is still a minor?
Why ask it
Insurers generally will not hand a large sum to a child, and what happens instead depends on local law: a guardian, a custodian or a trust. This one belongs to a lawyer as much as to the agent. An agent who says so is more useful than one who improvises.
How do I change a beneficiary, and does a marriage or divorce change anything automatically?
Why ask it
It usually takes a signed form sent to the insurer, and in many places a will does not override that form. Whether a divorce removes a former spouse depends on where you live and how the policy is set up, so ask instead of assuming. Reread the form after every large change in your family.
Who should own the policy, and does that matter for tax or for my estate?
Why ask it
The owner generally controls the policy and can change the beneficiary, and need not be the person whose life is insured. Ownership can affect tax and what creditors can reach, in ways that differ by place. Expect the agent to lay out the choices and send you to a tax or estate adviser for the decision.
Will the payout be taxed, and could it affect anything else my family receives?
Why ask it
The treatment of death benefits, gains in cash value and policies counted as part of an estate varies by country and sometimes by state. Ask how it generally works where you live, then confirm it with a tax adviser. Be careful with any answer that contains the word 'never'.
How does my family make a claim, and how long does payment usually take?
Why ask it
The practical parts are which documents are needed, whom your family calls, and whether the agent helps with the filing. Then ask what tends to slow a claim down: a death inside the contestability period, a beneficiary who cannot be found, an unclear cause. Afterward, write the insurer's name and the policy number where your beneficiaries will find them, because a policy nobody knows about can go unclaimed.
How can the money be received: one sum, installments, or left with the insurer?
Why ask it
Payout options vary, and some insurers hold the money in an account of their own unless told otherwise. Find out what the default is, what any money left with them earns, and whether the beneficiary can choose when the time comes. If you have no reason to fix the method yourself, ask whether that choice can be left open.
How to talk to an agent or insurer about life insurance
Practical guidance for the conversation itself
Before the conversation
Write down what the money is for
List who depends on you and what they would need: years of income, the mortgage, child care, school costs, a final bill or two. An agent can only size a policy against a purpose. If you arrive with the list, the conversation starts from your life and not from a product.
Gather the numbers you already have
Take-home pay, debts with their balances, savings, and any coverage through work or from an old policy. With those in hand, the Coverage amount questions go quickly and you can check the agent's arithmetic as it is done.
Find the old policy first if you have one
For a review, bring the policy document and the latest annual statement. The type of policy, the date it started, the named beneficiaries and the current premium answer half the questions before anyone speaks, and they show which half is still open.
Be ready to describe your health plainly
Medications, diagnoses, family history, tobacco use and risky hobbies all shape the price. Make your notes at home so nothing is forgotten or softened in the meeting. A quote built on the full picture is the only one worth comparing.
While you are asking
Start with the amount, not the product
Work through Coverage amount before Type of policy. Once the need has a size and an end date, most of the choice between term and permanent makes itself, and a recommendation that ignores the need is easy to spot.
Ask to see the page
For the premium, the exclusions, conversion and the grace period, ask where it says so in the policy or the illustration. A quote and a brochure are summaries. The contract is what your family will be holding when it matters.
Ask how it works where you live
Cooling-off periods, tax, what happens when an insurer fails and how a divorce affects a beneficiary all depend on country or state. A good agent answers for your place and tells you when the question belongs to a lawyer or a tax adviser.
Take the paperwork home
Nothing about a life policy has to be decided in the meeting. Leave with the quote, the illustration and a sample policy if one is available, and read the exclusions and the lapse terms without anyone waiting for your signature.
Comparing quotes and policies
Same amount, same length, same health class
Two quotes only compare when all three match. If one agent priced you at the best health class and another a step down, ask each to quote both, and the difference between insurers will be what remains.
Term against permanent, in one table
Put the yearly premium for each side by side, then the total paid by year twenty and what the permanent policy would hand back if surrendered then. Use the contractual minimum figures, not the projected ones. Whether the extra buys something you need is then a plain question.
Line up the clauses, not only the price
For each policy note the conversion deadline, the grace period, the reinstatement window and which riders are included. A slightly more expensive policy that can be converted until a later age may be the better buy for someone with a family history of illness.
An old policy against a new one
Set the in-force illustration for the policy you own beside the illustration for the replacement. Add what you would lose by leaving: surrender charges, a health class earned when you were younger, a contestability period already behind you. If the case for switching survives that, it is a real one.
Reasons to slow down
A product before any questions
If a policy is named before anyone has asked about your dependents, debts and income, the recommendation was ready before you arrived. Ask the Coverage amount questions anyway and see whether the advice changes.
Projections spoken of as promises
Cash value growth, dividends and 'it pays for itself after a few years' rest on assumptions. When the answer to 'what if it does not' is a change of subject, ask for the illustration on minimum assumptions and read that one.
A push to sign today
Prices generally rise with age, and an agent can tell you the exact date yours would change. A deadline with no date behind it is there for the seller. Take the days you need, and if you do sign, use any cooling-off period to read the policy.
A suggestion to leave something off the form
Whoever suggests it will not be the one explaining it to the insurer later. An omission can surface when a claim is made, at the point your family can least afford a dispute. Answer fully and let the price be what it is.