A recent article in the Wall Street Journal reports that term life insurance rates are on the rise.
P recent arremium increases averaging about 5% to 15% started in January and are sweeping through the industry. One reason is that higher capital and reinsurance costs for insurance companies linked to tighter credit markets are making it more expensive for insurers to maintain needed cash reserves. Another is that insurers are receiving lower returns on their investments, putting additional pressure on them to raise money.
For consumers, that means the era of counting on lower rates five or 10 years down the line could be over for a while. It also means locking in premiums before they go up.
The increase in rates is due in large part to the fact that insurance companies have been hit hard by the economy and have seen their investment holdings diminish in value.
The article also points out that it is wise to comparison shop because not everyone is increasing rates at this point. The term life industry is fairly competitive, so it is helpful to work with someone who can shop your coverage with a variety of companies. At AC Forrest Insurance Group, we’ll do just that. We believe that everyone needs term life coverage (we rarely suggest or sell other life insurance products as we don’t believe they’re generally good investments). We’ll be happy to help you find the best rate and policy. Contact us soon before rates go up!