In an environment with low interest rates, the cost of the coverage is on its way up.
According to the data that has been released by an online life insurance comparison agency, term policies are becoming more expensive and are slightly more difficult to find than they used to be.
This news comes after a decade in which prices had been consistently plummeting to record lows.
However, the latest research from IntelliQuote has shown that the premiums that are being quoted for term life insurance policies increased by an average of 3 percent last year. That same organization is predicting that similar increases will continue to be seen in 2013. They have suggested that the reason behind this is interest rates.
Life insurance companies are not able to achieve the necessary yields on their bonds, making coverage more expensive.
The life insurance policies that are being the hardest hit by this trend are standard 20-year terms. Other products have been cut off, altogether. In fact, ING and Genworth have both announced that they are no longer selling 30 year term policies, and the rates for those products among other carriers have increased by 5 percent, says AccuQuote’s Byron Udell.
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Equally, while life insurance premiums do appear to be on the rise among term policies at the moment, it is still possible to find cheaper rates, simply because they vary widely from one insurer to the next. In order to be able to receive the best price for the coverage, it is recommended that comparisons be performed online, as it does not take long to see that a policy can be considerably less expensive with one insurer than it is with another.
At the same time, it is important to take factors other than premiums into consideration when looking for term life insurance. Industry experts recommend that consumers should perform price comparisons but that they should also choose coverage from an insurer with an A rating or better in its financial strength, as per A.M. Best. This helps to ensure that the purchase will be a safer investment with considerably less risk.