Asked by Chrisitna  |  Submitted January 14, 2016

I hear all the time that there is a “price war” with term life. I’ve been hearing that for years. Is it true?

Is there a price war, a battle, or a fight, or...?

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  Answers  |  1

January 14, 2016

Hello Christina,

It is only true in the sense that life insurers who compete with each other will monitor and adjust the cost of coverage periodically to encourage shoppers to buy and to stay competitive. The same thing is happening at your grocery stores, your gas stations, and your cleaners. It is not news, and it is truly not a price war. It may sound a bit silly, but what would happen if those fighting the war actually won the war? It seems that those of us who buy life insurance would benefit from free coverage, since winning "the war" would inevitably mean driving the cost to zero, right? The fact is that the only way for insurers to remain in business (so that they can provide coverage in trade for our dollars) is to charge for what they provide, so don't expect the war to produce any winners.

Worthy of note: when comparing premiums on a multi carrier spreadsheet the top two or three carriers show only about a dollars worth of difference on a monthly premium for comparable coverage. That is not by accident.

Term insurance is inexpensive. If you need it, it would be good to get it. If you are concerned about the cost, then set a budget and get as much as your budget will allow from a highly rated competitive carrier. And ignore the hype.


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