Online life insurance searches grow by 15%

When most people think of getting insurance quotes online, they think about car insurance, but the life insurance business is surging in cyberspace.

According to comScore, an online market research firm, searches for life insurance information grew to 16.6 million queries in 2009, charting an increase of 15% over 2008. During the same period, consumers requested more than two million online quotes for life insurance, a sign that consumers are warming to the Internet as an instrument for sourcing life insurance.

“The numbers don’t surprise me at all,” says Richard Reich of www.lifeinsure.com. “The consumer experience for life insurance customers online has improved dramatically over the last couple of years, even though some obstacles to continued growth still remain.”

Reich says the majority of the consumers represented in the study wound up on specific company sites, instead of sites that broker for many different companies.

“One giant pitfall is that many companies require that people enter their names, email addresses and phone numbers to get life insurance quotes,” said Reich. “This almost always leads to your email box filling up and your phone ringing off the hook as multiple agents contact you to sell you policies.”

Reich’s advice for consumers looking for life insurance online includes:

Make sure the insurance website you choose is not from a single insurance company. Choose a site with multiple life insurance companies represented.
Check financial ratings and strength. The recent financial crisis hit a number of the major insurance companies, so don’t choose based on reputation alone. Check their financial strength ratings with the consumer advocate sites as well as financial ratings companies like A.M. Best.
Be careful of rate quote “bait and switch.” Some companies might quote you the best possible rate initially based on incomplete information, but once the insurance company reviews your medical exam results and health history, you may wind up with a much higher bill than anticipated. If your quote does not take into account your height and weight and answers to basic health questions, it’s possible that you’ve been baited with an artificially low rate.

“Online consumers should always be wary of methods designed to get their personal information,” Reich adds. “The simple truth is that insurance websites do not need your name, email address or phone number to offer you a genuine quote for life insurance, so don’t fall for this. Only submit your name and contact information when actually applying for a policy -- it’s what’s best for the consumer and it’s good business for insurance companies.”