FAQ
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Beneficial Insurance Marketing
| 22953 Hwy ZZ Marionville, MO 65705 Business (417)229-3420 Fax (417)463-2355 E-mail richardwu@beneficial-ins.com |
Life Insurance Specific:
Application Process Specific:
What is life insurance?
Life insurance is a contract between an insurance company and the insurance policy owner(s). The insurance
company pays a cash amount or death benefit to the beneficiary(s) named in the policy upon the death of the
insured named in the policy.
Purposes of life insurance include providing financial security for living beneficiaries, providing for business
continuation, satisfying estate tax requirements among others.
The two most common types of life insurance policies are term life insurance and whole life insurance.
What is Term Life insurance?
Term Life Insurance is the most basic form of life insurance. It provides coverage for a specified period of time
(e.g. 5, 10, 15, 20, 25, or 30 years) in exchange for a specified premium. If the death of the insured individual
occurs within this period of time or term period, the insurance company will pay the death benefit. If the term
period expires while the insured individual is still living, the policy will terminate and no death benefit will be paid.
In most instances the policy can remain in force after the end of the term but at an increased rates.
What is the Return of Premium Life Insurance?
Return of Premium Term Life Insurance is a product that allows you to recover up to 100% of all premiums paid
on the policy. If the policy reaches the end of the policy term and there has been no death benefit claim, the
insurance company will return all premiums paid on the policy to the policy owner. If the policy is cancelled
(lapsed or surrendered) at a point prior to the end of the term, a designated percentage of the premiums paid will
be returned to the policy owner. Contact us to learn more about Return of Premium term life insurance.
What is Whole Life Insurance?
Whole Life Insurance provides coverage for the life of the insured individual(s). These policies are more complex
and expensive than term life insurance. They often accumulate tax deferred cash values from which future
premiums can be paid or policy loans can be made. These policies typically stay in force as long as the premiums
continue to be paid.
How do I determine the amount of coverage I need?
Your coverage need will depend on your individual circumstances. Factors you should consider include
anticipated final expenses (e.g. medical bills and burial costs), living expenses for your surviving family members,
any outstanding loans (e.g. auto and credit cards), the outstanding balance on your mortgage, anticipated
education costs for your children, estate taxes, and business continuation expenses.
Keep in mind that your needs will most likely change over time and what seems like enough today may not be
adequate in ten years. It is usually best to purchase an amount you can afford while at the same time considering
future needs.
For assistance choosing your coverage amount and best product to fit your needs, please contact us.
How do I choose the length of coverage?
Your coverage length will depend on your individual circumstances. Factors you should consider include your
age, your spouse's age, your children's ages, the length of your financial obligations (e.g. mortgage and student
loans) and the number of years until retirement.
You will want to choose a term period that covers all of the above factors. For example, if you have a five-year
old child and you wish to support that child through college and perhaps graduate school, you may need a policy
term period of 20 years or more.
Is my life insurance policy convertible?
Most term life insurance policies are convertible to whole life insurance policies. Convertible policies can generally
be converted to whole life policies within a specified period of time from policy issue, without having to go
through underwriting (unless you increase your benefits). We can tell you what that time frame is.
Will my premium rates change each year?
No, your premium rates are guaranteed to remain the same during the entire term period. These are called fully
guaranteed or level term policies.
Will my final premium rates be the same as the rates your quoted on the Web site?
It is certainly possible, but not guaranteed. Your final rates will be determined by the insurance company through
a process called underwriting. Underwriting includes a review of your current health status, medical history,
family history and driving record among other things.
Underwriting will determine your final rating class, which will establish your final premium rates. Your rating class
may or may not be the same as that quoted on our Web site. With your assistance, we will provide the most
accurate quote possible up front.
What happens at the end of the life insurance term period?
The life insurance policy will terminate at the end of the term period. However, you may have the option to
renew the policy on an annual basis without providing evidence of insurability. The cost to renew annually will
most likely be much higher than the previous guaranteed premium rates were, but it may be a valid option for
individuals who find themselves uninsurable due to injury or illness.
What are the different rating classes and what do they mean?
The policy rating class is the risk category which an applicant qualifies for according to an insurance company's
underwriting guidelines. Common rating classes are Preferred, Standard and Substandard. The policy rating class
will determine the premium rate for the policy.
Why do my quotes show different rating classes than the rating class that was selected?
Quoting is not an exact science. As agent we try to quote you the most appropriate rating class for each company
based on the information you have provided. Since underwriting guidelines vary by company, your quoted rating
class may vary as well. For example, a build of 5'10" and 190 pounds may qualify for a Preferred rating class
with one company and a Standard Plus rating class with another.
What is the payment mode?
The payment mode is the term of premium payments for a life insurance policy. Available modes are annual,
semi-annual, quarterly and monthly.
Why is the annual mode less expensive than the others?
This is because insurance companies build in a charge or 'factor' for all modal premiums to cover their cost of
billing administration. For example, the quarterly mode requires four billing cycles in a year whereas the annual
mode requires only one. The additional charge in the quarterly payment mode helps to cover the extra costs
associated with extra billing cycles.
Can I change my coverage amount or length of coverage at any time?
You can change these terms during the application process. Once your policy is in force you may be able to make
changes dependent upon the terms of the individual insurance company. The insurance company will require new
evidence of insurability for any changes resulting in increased benefits (e.g. a higher coverage amount or longer
term period).
What is the Accidental Death Benefit rider?
The accidental death benefit rider is an optional policy provision that pays an additional amount over and above
your policy coverage amount in the event the insured's death is caused by an accident. Even without this rider,
your term life insurance policy will pay the stated death benefit in the policy if the insured's death is the result of
an accident.
What is the Children's Term Life Insurance rider?
The children's term life insurance rider is an optional policy provision that pays a death benefit for each covered
child in the event of that child's death. Life insurance companies will typically provide between $10,000 and
$20,000 coverage on the life of each dependent child of the insured, subject to age limitations and other
requirements. One rider may cover multiple children.
What is the Waiver of Premium rider?
The waiver of premium rider is an optional policy provision that provides for the payment of a life insurance
policy's premium in the event of the total disability of the insured. Age limitations and coverage maximums
usually apply.
What is the Accelerated Death Benefit rider?
The accelerated death benefit is a policy provision that allows for the advance payment of a portion of a life
insurance policy's death benefit in the event the insured is diagnosed as terminally ill. Requirements vary by
insurance company. This rider is commonly an included feature of many term life insurance policies requiring no
additional cost.
How does the application process work?
First you must complete your application in writing, online, or by phone (dependent on the company). The
application will be then be submitted for review and processing. We will be available to assist during the entire
application process. Step two is to complete your paramed exam, if required.
Once the exam results are received by the insurance company, they will be matched to your application and
submitted for underwriting review. This review can be as short as a few days or as long as several weeks,
depending on your individual circumstances. For example, if you have medical history that underwriting wants to
review, medical records may be ordered from your physician(s). Depending on how quickly your physician(s)
respond to the insurance company's request will determine how long your application stays in underwriting. We
will advise you of your applications progress during this process. If we know that underwriting has requested
medical records from your physician, you can help the process along by following up with the doctors office
yourself.
Once underwriting is completed, the insurance company will make an offer on your policy and send the
application to policy issue. If there are any changes or amendments we will notify you of these changes, answer
any of your questions, and help you determine if the policy is still a viable option for your needs.
What are my options for paying my premium?
Payments can be made in several different ways dependent on the insurance company. The preferred method of
payment for most insurance companies is an electronic fund transfer (EFT) from your checking or savings
account. Some companies will set up a payments using a credit or debit card. The last acceptable form of
payment is direct billing.
What happens to my initial premium payment if I am not approved or decide not to accept the insurance
company's offer?
Any checks you submit with your application for life insurance will be refunded to you if you are not approved or
if you decide not to put your policy in force.
What happens if I am not approved at the rate I applied for?
If underwriting assigns a rating class different from the class you applied for, we will work with you to determine
the best course of action. This can include changing the terms of your policy to reduce the premium, challenging
the insurance company's findings, or changing to another insurance company if necessary.
What is a paramed exam, why is it required, and how do I schedule one?
Some insurance companies require paramed exam in conjunction with a life insurance application. We will
schedule a third party medical examination at the time we receive the application or the company will contact you
to schedule your paramed. They will work with you to arrange your exam at a time and location most convenient
to you. The exam takes only about 30 minutes and there is no cost to you for the exam.
A basic paramed exam includes the following:
Please remember these suggestions as you prepare for your paramed exam:
Other requirements that may be included are:
How long does the application process take?
The length of the process depends on many factors, the company, how the application is submitted (paper vs.
online), medical history, etc. Some applications may be processed in a matter of a couple days, but can take up
to 6 weeks for approval after submission of your application.
How can I speed up the process of receiving my insurance policy?
There are many ways you can control how fast a policy is completed, however there are other influences that
determine the speed of the application process. The following is a list of the most important and beneficial tips to
speeding up the process.
Who issues the policy?
Your policy will be issued by the insurance company you choose to apply with.
Do I need to be a U.S. resident or U.S. citizen to qualify for life insurance?
All of our partner insurance companies require applicants to be U.S. residents, typically for a period of 3 years
prior to the application date. They also require U.S. residency to continue beyond the policy effective date.
Most of our partner insurance companies require applicants to be U.S. citizens or to hold a permanent visa/green
card. Coverage may be available for U.S. residents holding a temporary work visa. Please call for details.
Why does the insurance company want to know my financial information for life insurance?
An applicant's financial information is among several factors used to determine the amount of insurance the
company is able to issue to an applicant. This information is required by insurance companies as they must justify
the coverage amounts of all policies they issue.
Income multiples are one method of calculating coverage amounts, which is why annual income is required. Net
worth helps insurance companies develop a picture of the family's overall financial position and potential loss in
the event of the insured's death.
A common misconception among insurance consumers is they can purchase any amount of life insurance they
desire, regardless of financial considerations. This simply is not the case. All insurance companies use financial
information to determine allowable coverage amounts. This is done to control fraud and limit excessive insurance
situations.
- What is life insurance?
- What is Term Life Insurance?
- What is Whole Life Insurance?
- What is the Return of Premium Life Insurance?
- How do I determine the amount of coverage I need?
- How do I choose length of coverage?
- What happens at the end of the life insurance term period?
- Is my life insurance policy convertible?
- Will my premium rates change each year?
- Will my final premium rates be the same as the rates you quoted on the Web site?
- What are the different rating classes and what do they mean?
- Why do my quotes show different rating classes than the rating class I selected?
- What is the payment mode
- Why is the annual mode less expensive than the others?
- Can I change my coverage amount or length of coverage at any time?
- What is a Accidental Death Benefit rider?
- What is a Children's Term Life Insurance rider?
- What is a Waiver of Premium rider?
- What is a Accelerated Death Benefit rider?
- What is a Disability Rider?
Application Process Specific:
- Why wasn't I quoted the same rating class I chose?
- How does the application process work?
- What are my payment options?
- What happens to my initial premium payment if I am not approved or decide not to accept the insurance
company's offer? - What happens if I am not approved at the rate I applied for?
- What is a paramed exam, why is it required, and how do I schedule one?
- How long does the application process take?
- How can I speed up the process of receiving my insurance policy?
- Who issues the policy?
- Do I need to be a citizen of the U.S. to apply for life insurance?
- Why am I being asked for my financial information?
- What is net worth?
- What is a replacement transaction and how do I complete one?
What is life insurance?
Life insurance is a contract between an insurance company and the insurance policy owner(s). The insurance
company pays a cash amount or death benefit to the beneficiary(s) named in the policy upon the death of the
insured named in the policy.
Purposes of life insurance include providing financial security for living beneficiaries, providing for business
continuation, satisfying estate tax requirements among others.
The two most common types of life insurance policies are term life insurance and whole life insurance.
What is Term Life insurance?
Term Life Insurance is the most basic form of life insurance. It provides coverage for a specified period of time
(e.g. 5, 10, 15, 20, 25, or 30 years) in exchange for a specified premium. If the death of the insured individual
occurs within this period of time or term period, the insurance company will pay the death benefit. If the term
period expires while the insured individual is still living, the policy will terminate and no death benefit will be paid.
In most instances the policy can remain in force after the end of the term but at an increased rates.
What is the Return of Premium Life Insurance?
Return of Premium Term Life Insurance is a product that allows you to recover up to 100% of all premiums paid
on the policy. If the policy reaches the end of the policy term and there has been no death benefit claim, the
insurance company will return all premiums paid on the policy to the policy owner. If the policy is cancelled
(lapsed or surrendered) at a point prior to the end of the term, a designated percentage of the premiums paid will
be returned to the policy owner. Contact us to learn more about Return of Premium term life insurance.
What is Whole Life Insurance?
Whole Life Insurance provides coverage for the life of the insured individual(s). These policies are more complex
and expensive than term life insurance. They often accumulate tax deferred cash values from which future
premiums can be paid or policy loans can be made. These policies typically stay in force as long as the premiums
continue to be paid.
How do I determine the amount of coverage I need?
Your coverage need will depend on your individual circumstances. Factors you should consider include
anticipated final expenses (e.g. medical bills and burial costs), living expenses for your surviving family members,
any outstanding loans (e.g. auto and credit cards), the outstanding balance on your mortgage, anticipated
education costs for your children, estate taxes, and business continuation expenses.
Keep in mind that your needs will most likely change over time and what seems like enough today may not be
adequate in ten years. It is usually best to purchase an amount you can afford while at the same time considering
future needs.
For assistance choosing your coverage amount and best product to fit your needs, please contact us.
How do I choose the length of coverage?
Your coverage length will depend on your individual circumstances. Factors you should consider include your
age, your spouse's age, your children's ages, the length of your financial obligations (e.g. mortgage and student
loans) and the number of years until retirement.
You will want to choose a term period that covers all of the above factors. For example, if you have a five-year
old child and you wish to support that child through college and perhaps graduate school, you may need a policy
term period of 20 years or more.
Is my life insurance policy convertible?
Most term life insurance policies are convertible to whole life insurance policies. Convertible policies can generally
be converted to whole life policies within a specified period of time from policy issue, without having to go
through underwriting (unless you increase your benefits). We can tell you what that time frame is.
Will my premium rates change each year?
No, your premium rates are guaranteed to remain the same during the entire term period. These are called fully
guaranteed or level term policies.
Will my final premium rates be the same as the rates your quoted on the Web site?
It is certainly possible, but not guaranteed. Your final rates will be determined by the insurance company through
a process called underwriting. Underwriting includes a review of your current health status, medical history,
family history and driving record among other things.
Underwriting will determine your final rating class, which will establish your final premium rates. Your rating class
may or may not be the same as that quoted on our Web site. With your assistance, we will provide the most
accurate quote possible up front.
What happens at the end of the life insurance term period?
The life insurance policy will terminate at the end of the term period. However, you may have the option to
renew the policy on an annual basis without providing evidence of insurability. The cost to renew annually will
most likely be much higher than the previous guaranteed premium rates were, but it may be a valid option for
individuals who find themselves uninsurable due to injury or illness.
What are the different rating classes and what do they mean?
The policy rating class is the risk category which an applicant qualifies for according to an insurance company's
underwriting guidelines. Common rating classes are Preferred, Standard and Substandard. The policy rating class
will determine the premium rate for the policy.
Why do my quotes show different rating classes than the rating class that was selected?
Quoting is not an exact science. As agent we try to quote you the most appropriate rating class for each company
based on the information you have provided. Since underwriting guidelines vary by company, your quoted rating
class may vary as well. For example, a build of 5'10" and 190 pounds may qualify for a Preferred rating class
with one company and a Standard Plus rating class with another.
What is the payment mode?
The payment mode is the term of premium payments for a life insurance policy. Available modes are annual,
semi-annual, quarterly and monthly.
Why is the annual mode less expensive than the others?
This is because insurance companies build in a charge or 'factor' for all modal premiums to cover their cost of
billing administration. For example, the quarterly mode requires four billing cycles in a year whereas the annual
mode requires only one. The additional charge in the quarterly payment mode helps to cover the extra costs
associated with extra billing cycles.
Can I change my coverage amount or length of coverage at any time?
You can change these terms during the application process. Once your policy is in force you may be able to make
changes dependent upon the terms of the individual insurance company. The insurance company will require new
evidence of insurability for any changes resulting in increased benefits (e.g. a higher coverage amount or longer
term period).
What is the Accidental Death Benefit rider?
The accidental death benefit rider is an optional policy provision that pays an additional amount over and above
your policy coverage amount in the event the insured's death is caused by an accident. Even without this rider,
your term life insurance policy will pay the stated death benefit in the policy if the insured's death is the result of
an accident.
What is the Children's Term Life Insurance rider?
The children's term life insurance rider is an optional policy provision that pays a death benefit for each covered
child in the event of that child's death. Life insurance companies will typically provide between $10,000 and
$20,000 coverage on the life of each dependent child of the insured, subject to age limitations and other
requirements. One rider may cover multiple children.
What is the Waiver of Premium rider?
The waiver of premium rider is an optional policy provision that provides for the payment of a life insurance
policy's premium in the event of the total disability of the insured. Age limitations and coverage maximums
usually apply.
What is the Accelerated Death Benefit rider?
The accelerated death benefit is a policy provision that allows for the advance payment of a portion of a life
insurance policy's death benefit in the event the insured is diagnosed as terminally ill. Requirements vary by
insurance company. This rider is commonly an included feature of many term life insurance policies requiring no
additional cost.
How does the application process work?
First you must complete your application in writing, online, or by phone (dependent on the company). The
application will be then be submitted for review and processing. We will be available to assist during the entire
application process. Step two is to complete your paramed exam, if required.
Once the exam results are received by the insurance company, they will be matched to your application and
submitted for underwriting review. This review can be as short as a few days or as long as several weeks,
depending on your individual circumstances. For example, if you have medical history that underwriting wants to
review, medical records may be ordered from your physician(s). Depending on how quickly your physician(s)
respond to the insurance company's request will determine how long your application stays in underwriting. We
will advise you of your applications progress during this process. If we know that underwriting has requested
medical records from your physician, you can help the process along by following up with the doctors office
yourself.
Once underwriting is completed, the insurance company will make an offer on your policy and send the
application to policy issue. If there are any changes or amendments we will notify you of these changes, answer
any of your questions, and help you determine if the policy is still a viable option for your needs.
What are my options for paying my premium?
Payments can be made in several different ways dependent on the insurance company. The preferred method of
payment for most insurance companies is an electronic fund transfer (EFT) from your checking or savings
account. Some companies will set up a payments using a credit or debit card. The last acceptable form of
payment is direct billing.
What happens to my initial premium payment if I am not approved or decide not to accept the insurance
company's offer?
Any checks you submit with your application for life insurance will be refunded to you if you are not approved or
if you decide not to put your policy in force.
What happens if I am not approved at the rate I applied for?
If underwriting assigns a rating class different from the class you applied for, we will work with you to determine
the best course of action. This can include changing the terms of your policy to reduce the premium, challenging
the insurance company's findings, or changing to another insurance company if necessary.
What is a paramed exam, why is it required, and how do I schedule one?
Some insurance companies require paramed exam in conjunction with a life insurance application. We will
schedule a third party medical examination at the time we receive the application or the company will contact you
to schedule your paramed. They will work with you to arrange your exam at a time and location most convenient
to you. The exam takes only about 30 minutes and there is no cost to you for the exam.
A basic paramed exam includes the following:
- Height/weight measurements
- Blood pressure readings
- Heart rate readings
- Urine sample
- Blood sample
- Medical history questionnaire
Please remember these suggestions as you prepare for your paramed exam:
- Schedule the exam for a time when you will most likely be able to keep the appointment. If the length of
your work day varies, try scheduling the exam early in the morning, on a day off, or a weekend. - Fast for a period of at least 8 hours prior to the exam, preferably 12 hours if possible. This will result in
more accurate blood test results. - If you are an occasional cigar smoker, refrain for as long as possible prior to the test. Increased nicotine
levels in your urine will most likely qualify you for tobacco/smoker rates. Of course, you will need to
disclose your smoking habits on your application as well. - Depending on your specific circumstances (e.g. age, amount of insurance, medical history, etc.) the
insurance company may require additional testing or information. These requirements do not apply to all
applicants.
Other requirements that may be included are:
- Electrocardiogram
- Chest X-ray
- Treadmill Test
- Attending Physician's Statement
- Medical Records
- Motor Vehicle Report
How long does the application process take?
The length of the process depends on many factors, the company, how the application is submitted (paper vs.
online), medical history, etc. Some applications may be processed in a matter of a couple days, but can take up
to 6 weeks for approval after submission of your application.
How can I speed up the process of receiving my insurance policy?
There are many ways you can control how fast a policy is completed, however there are other influences that
determine the speed of the application process. The following is a list of the most important and beneficial tips to
speeding up the process.
- Complete the application request form accurately. This will allow you to receive the application quickly.
- Complete your application packet promptly and accurately. This is the biggest delay in the process. If you
can complete your application completely and return it within days you can cut weeks of the overall time. - For corrections, cross through the incorrect information, write in the correct information and initial next to
the correction. Do not use white out. - Respond to us or the insurance company right away with any requests for missing or additional information.
- Schedule your paramed exam as soon as you are contacted by Portamedic.
Who issues the policy?
Your policy will be issued by the insurance company you choose to apply with.
Do I need to be a U.S. resident or U.S. citizen to qualify for life insurance?
All of our partner insurance companies require applicants to be U.S. residents, typically for a period of 3 years
prior to the application date. They also require U.S. residency to continue beyond the policy effective date.
Most of our partner insurance companies require applicants to be U.S. citizens or to hold a permanent visa/green
card. Coverage may be available for U.S. residents holding a temporary work visa. Please call for details.
Why does the insurance company want to know my financial information for life insurance?
An applicant's financial information is among several factors used to determine the amount of insurance the
company is able to issue to an applicant. This information is required by insurance companies as they must justify
the coverage amounts of all policies they issue.
Income multiples are one method of calculating coverage amounts, which is why annual income is required. Net
worth helps insurance companies develop a picture of the family's overall financial position and potential loss in
the event of the insured's death.
A common misconception among insurance consumers is they can purchase any amount of life insurance they
desire, regardless of financial considerations. This simply is not the case. All insurance companies use financial
information to determine allowable coverage amounts. This is done to control fraud and limit excessive insurance
situations.
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