100k Whole Life Insurance, Rates, Alternatives and Why Get It?
If you’re looking for 100k in whole life insurance, then chances are your needs for life insurance are more permanent than getting a typical term life insurance policy. Especially when you’re getting life insurance over 50, your reasons for getting coverage tend to be different than in your early 30’s.
Let’s dive into what you may need 100k in whole life insurance for and any alternative options available.
If you’re looking to compare rates for 100k coverage, use the quoter on this page or contact us today.
What is Whole Life
Whole life insurance is a very popular type of permanent life insurance. Many people actually think that it is the only permanent coverage out there. Unlike term life insurance, whole life insurance provides coverage for your entire life. Meaning the coverage never expires and usually matures at age 100. With term life, you normally pick a set time period you’d want to be covered, like 20 years, and pay the premiums for that set amount of time. If you’re still alive when the 20-year term is up, your coverage expires. With whole life insurance, you remain covered for as long as you maintain your premiums.
That is not all though. Whole life insurance also comes with something called “cash value.” This is a savings component attached to the life insurance policy. What it does it takes a portion of your premium and generates interest on that portion of your premium that increases the cash value of your policy. This means that your policy grows in value and you can even borrow against it once enough cash value has been accumulated.
The downside of this is that it tends to make the policy much more expensive. Whole life insurance policies can be as much as 10 times more expensive than term life policies.
A lot of people get frustrated because they want something that covers them for life, but not something that comes with extra bells and whistles, which they have to pay extra for.
Whole Life Alternative
Lucky for you, whole life insurance isn’t the only permanent life insurance option out there. Many people want something between a term life policy and a whole life policy. That bridge between the two is called a Guaranteed Universal Life insurance policy. This product is often referred to as a “permanent term” product, for a few reasons.
On one end, it is one of the simplest forms of permanent insurance because like term insurance, it is a “pure protection” plan that offers life insurance coverage without a cash value component. Another reason its called a permanent term product is that it technically does expire. You can get a GUL policy that lasts to age 90, or age to 121 and in some cases in between. Once you hit that age, your coverage will expire. The reason it is still considered a permanent product is that by that age you statistically won’t be around anymore, or your needs for life insurance would most likely have disappeared.
If you’re older, then this can be a good option as you don’t have as much time as a young person to accumulate cash value, and in fact, may have no need for it. This is what makes this product really convenient.
The last reason it is compared to the term and is the major benefit of this product is its affordability. GUL policies can be as much as 5 times cheaper than a whole life policy, for the same premium amount.
Reasons for Getting 100k in Life Insurance Coverage
There are a few reasons you may need 100k in coverage, let’s look at what they are.
When we hear someone is looking for 100k in coverage, most of the time its to leave behind a small legacy for their family. 100k isn’t enough to replace income, but it is enough to make things easier for your family. Maybe you want to help your kids pay off their mortgage or help your grandkids with their college. You may just want to provide a nice cushion for your family to have when you pass. These are all good reasons to get $100,000 in life insurance coverage.
Another reason people get $100,000 in life insurance is to take care of any final expenses. Maybe you have some debt laying around that you know you want to pay off before you go, or want to make sure your hospital bill is paid for. Lastly, you also don’t want to burden your family with burial costs.
Replacing Home Maker
One of the things we hear often is people wanting to get life insurance for a homemaker and often opt for a lesser amount of coverage. The truth is though, you may need to replace multiple years of an adult’s salary to replace the loss you will have with outsourcing all homemaker duties. The reality is the value of the homemaker is right up to par with the average salary, so you may want to consider similar coverage amounts as you would for a working person.
Should I Get 100k Term Life Instead?
Term life insurance can be a good option if your needs for life insurance are temporary. For example, if you already have a policy in place and maybe are just looking to get a policy that covers your mortgage for the remainder of its years, then this would be a good option. It could also be that maybe you just want to pay off your grandchildren’s college tuition in the case of your passing, then a term life policy can be useful as well as most of these expenses are temporary by nature.
What you should really do is sit down with a pro and determine what your actual needs are. Professionals tend to see things that we miss when it comes to what we may need and they will be able to advise you better on your best course of action.
In the end, it really starts with what you can afford, and a few factors will determine your rate.
What Determines Your Rate
How much you will pay will depends on a few factors.
Your health will be a big factor when it comes to what you pay. Life insurance companies will verify your health in a few different ways. For one, they will do a thorough dive into your past medical history to see any surgeries or ailments you may have had or currently have.
On top of that, they will also dive into your medical exam results. Every time you get coverage you will go through a medical exam that runs like a typical physical. You will be required to provide a sample of your blood and urine, and your height and weight will be measured as well as your blood pressure checked. This will then be tested for your sugar levels, blood pressure readings and any substances found in your urine. All these results will be considered alongside your medical history to see what health class you fall into.
Life insurance companies will also dive into your background history, this means any red flags, like felonies or even speeding tickets, will cause them to rate you up in most cases. The severity and frequency of the ref flags will definitely play a huge role. Life insurance companies use this to see the kind of risk your behavior posses to put you into life-threatening situations.
One of the most obvious factors is your age. The older you are the closer you are to your death, and therefore, the more expensive your life insurance rate. No matter the coverage you get, your age will play the most obvious role in how much that particular policy costs.
Your lifestyle will eigh into your rate. This includes something as simple as whether or not you smoke, to something more complex like what you do for a living. For example, if you skydive as a profession or as a hobby, life insurance companies will not offer you regular rates. They will want to charge you more due to the risk associated with such an endeavor. The only dangerous occupations that tend to get a break are first responders, which includes police officers and firefighters. When you’re a high-risk individual, you want to work with an agent that specializes in such cases. Some companies are more lenient than others when it comes to certain risks and will provide better rate classes than others.
The Company You Choose
Lastly, and probably most importantly, the biggest factor that will determine your rate is the company you choose to work with. The tough thing to realize is, the lowest rate on the quoter, isn’t always the company with the best rate for your particular situation. Each company treats certain factors, like the ones above, differently. The key is to know which company favors your situation over another.
How to Find the Right Company for 100k Life Insurance Coverage
Trying to figure out which company will give you the best rate is close to impossible by yourself. What you want to do is work with a seasoned independent agent who has experience working with all the top companies on the market. The good thing is this doesn’t cost you anything as the agents are compensated by the companies themselves, without any extra cost to you. Stay away from agents that represent only one company as they tend to be biased in their approach and are more likely to just recommend working for the company they are with, even if its not the best bet for you.
The good news for you is you’ve reached your destination. We are an agency who specializes in working with all types of companies and know exactly what to do to get you the best rate on the market. So if you’re looking for 100k whole life insurance coverage, we’ve got you covered!