Term Life Insurance

Good news and bad news: term life insurance rates are at an all time low, but insurance companies have shortened the guarantee period for their lowest rates.

The biggest factors driving the fate of guaranteed life insurance rates is a proposal passed by most states' life insurance commissioners called Regulation Triple X. The bottom line is that life insurance companies cut rates to gain market share, with the promise of fatter future margins. When Triple-X was implemented, rates stayed low, but long term rate guarantees were removed.

Triple-X

Twenty and thirty year guaranteed life insurance rates (i.e. where the premiums are guaranteed for the ten or twenty year term) have become more expensive because of Guideline XXX, or "Triple-X". This guideline, which was pushed by the National Association of Insurance Commissioners (NAIC), requires insurance companies to substantially boost the amount of cash reserves for any term insurance premiums guaranteed beyond 5 years.

According to Bob Barney, President of Compulife® Software, Inc., "Triple-X will strengthen the position of life companies at the expense of the consumer, by transferring the risk of pricing errors from the life company to the consumer." Mr. Barney led an aggressive campaign against this regulation on the grounds that it was anti-consumer and unnecessary.

In short

Triple-X caused the companies to shorten price guarantees for their lowest rates. Consult with an independent agent for further clarification and to decide whether you should seek the lowest rate or the longest guarantee. But you can still take advantage of the low rates.

Then contact an independent agent to determine the rates for which you qualify, and to select the best insurance company, based on your health and lifestyle profile.