While many of the largest life insurance “internet marts” use misleading advertising to get you in the door, Selectquote is certainly the most consistent and pervasive.
Allow me to paint one of their ads for you often seen on MSNBC. The picture is of a husband and wife with two children obviously under the age of 3, having a picnic in a park. The ad goes on to say that the husband, who wants to protect his family, could have $500,000 worth of term life insurance for just $23 a month. It goes on to say that the wife could have the same amount of life insurance for just $13 per month. How good is life when you can protect your family from the unforeseen death of one of the parents for just $36 per month?
So what is misleading? As long as both of the parents qualify for the best rate, the quotes are accurate. Read the fine print if you’re fast enough.
The Selectquote recommendation for this family is 10 year term insurance. If you read one of my previous blogs on how to choose term insurance, you might remember that I used an example just like this. If a person or couple has a young child, I said, they will want to carry at least a 20 year policy to ensure that they have coverage locked in until the child is no longer dependent on them.
So, Selectquote has a family with two children under 3 and they are showing you 10 year term prices. Let’s say you love the prices and no one suggests that it may be the wrong product, so you buy your policies for $36 per month and go on with life. Let’s carry it further and say that one of you has a serious health issue come up before the end of that 10 year term.
So, 10 years down the road the need is still there. You need at least another 10 year term, if not longer, to get to the point where your children aren’t dependent on you. The problem is that now Mr Selectquote has, as an example, adult onset diabetes. When they go to get another term insurance policy, Mrs Selectquote, still in good health, gets a new 10 year term for about $31 per month. Mr Selectquote on the other hand, due to the early onset of his diabetes is going to pay around $130 per month.
Had Mom and Dad Selectquote been advised properly they could have locked in a 20 year level premium from the start, $27 per month for her and $31 per month for him. Do the math!!
Is Selectquote any more misleading than any other large company who shows you fine print so fast that you can’t possibly read it and understand it? No, probably not. In my opinion though, if you are going to hold yourself out as providing financial advise that can impact a family in a huge way, fine print is inappropriate and misleading ads are a contemptible way to get people to call.
This post is somewhat dated. Life insurance underwriting is changing and evolving continually. For more updated information check out some of the key word links. If you have a specific question or topic you need information for do a search. If you don’t find the answers you need contact me and we’ll make sure you get the information that is important to you.