In this article I compare the three term life insurance quote sites with the most accurate term life insurance quotes (InsuranceGuide.com, InsWeb.com, and InsureMarket.com) on four criteria -- quote accuracy, carrier selection, misquote handling, and website ease of use. InsuranceGuide.com wins hands down on all four criteria.
The two most important criteria (the criteria which will lead term life insurance buyers to the policy that is best for them) are:
(1) Quoting accuracy
(2) Carrier selection
Quoting accuracy is the degree that term life insurance quotes
are geared to your actual risk profile. But accurate term life insurance
quotes without carrier selection (i.e.., a number of competitive term life
insurance companies) will still leave you wondering if there isn't a
significantly better term life insurance policy for you out there.
Even with the most accurate quoting systems, misquotes occur (because you often don't know your cholesterol level or ratio, or any number of other exam results in advance -- what a backward system!)
If you end up not qualifying for the rate you were initially quoted,
and discover a better rate with another company (by rerunning a quote armed
with your exam results), you will want to be sure that you don't have to
start all over with a new agent. This is a good reason to work with a broker
who works with many companies, rather than an agent that only represents
one or two.
Don't be misled by quote systems that only ask age, sex, and smoker
status before quoting you. The fact is, a lot of risk variables are considered
by companies, and if you are serious about buying a policy, then you may
as well answer the most important health questions up front (and get as accurate
a quote as possible).
Rather than inundate the reader with a detailed discussion of the
myriad underwriting variables that are looked at when classifying risk, I'm
going to confine myself to the 5 variables that come into play most often,
for term buyers who are standard or better. These variables are:
Cholesterol is the risk factor that causes 37% of all misquotes (according to one medium-scale study.) Clearly getting this risk factor right is very important for accurate quoting. Getting the cholestrol factor right means asking about cholestrol level, colestrol ratio and about treatment and diagnosis.
InsWeb asks only about cholesterol level, ignoring cholesterol ratio. But the only time they are asked about cholesterol level is when the applicant admits to treatment or diagnosis in a section that most people don't read carefully especially if they consider themselves healthy.
InsureMarket, like InsWeb, asks only for cholesterol level, ignoring ratio. (The John Doe example on the previous page clearly showed how important cholestrol ratio is.) Unlike InsWeb, InsureMarket doesn't ask a question about treatment or diagnosis.
The rationale I've heard from representatives at both companies
is that "no one knows the ratio and/or level". This is increasingly incorrect
(more and more people can in fact enter a number here, and even if official
insurance exam results may differ, an actual past reading is more accurate
than no reading at all). Moreover, it is highly relevant to customers, after
examination, to be able to requote themselves if their cholesterol level
or ratio exceeds the limits on the originally applied-for quote.
Any attempt to list the fifteen most competitive term companies
is going to be challenged. Here is my clearly imperfect (but unbiased) list
(in alphabetical order), followed by a brief discussion of how I derived
Now for my selection criteria. I primarily used
Term4sale.com to derive my top 15
list. It is the most unbiased, comprehensive online quote site (Bob Barney
doesn't sell policies OR leads). I added ING Direct, which is exceptionally
competitive but which doesn't show up on Term4sale.com.
If a term buyer ends up discovering for the first time that he or she has a high cholesterol level, and can qualify for a better rate with a different company, neither InsWeb nor InsureMarket will be able to handle the switch smoothly. That's because their relationships are primarily with direct fulfillment centers tied to specific companies. (Eg., an agent working exclusively for John Hancock has no incentive to move a client to another carrier). InsWeb and InsureMarket are not integrated, full service brokers. InsuranceGuide.com is, and that would be a good reason to go through them, even apart from their clear superiority in quote accuracy and carrier selection.
Ease of use
Because InsWeb and InsureMarket invoke more graphics, and force the prospective term buyer to click through multiple pages, it takes 3 to 4 times as long to get a quote (on a 28.8 bps line, which is still prevalent), as compared to InsuranceGuide's no-nonsense, simple form. Moreover InsuranceGuide.com displays all choices (5,10,15,20, and 30 year), whereas with InsWeb and InsureMarket, one has to run 5 quotes to get that choice matrix. Enough said.
On each of the above criteria,
a superiority to InsWeb and
InsureMarket that belies the fact
that InsuranceGuide's technology budget is relatively minuscule, in comparison
to its well capitalized competitors. It seems that there is something to
be said for having a deep grasp of the current term life insurance delivery
process (warts and all), which David Phillips clearly does.