How to get a whole life insurance quote – and what to look for
Maybe you want permanent life insurance coverage with rates that never go up. Or, you like the idea of a policy with cash value that's always guaranteed to grow.1,2 Those are just two of the many reasons to get a quote for whole life insurance. Read on to learn more about how coverage works and what to look for – or tell us your ZIP code to connect with a local financial professional who can answer your questions.
Key advantages of whole life insurance
|A full death benefit from day one||Protection that lasts your entire life||Cash value helps build wealth|
|The entire benefit amount is payable to beneficiaries as an income tax-free lump sum from the first day the policy is in effect.3||Whole life insurance is the simplest way to get permanent life insurance protection, with level premiums that stay the same for life.||A percentage of each premium dollar goes toward cash value where it earns interest and grows tax-deferred at a guaranteed rate.4|
The cash value can be a lifelong asset
It typically takes a few years for the cash value to grow into a useful sum, but once that happens, it can be a valuable financial asset that provides several advantages. With enough cash value accumulation, you can:
- Purchase additional death benefit protection
- Take out a low-interest, tax-advantaged policy loan against your cash value 5
- Use the funds to pay most or all of your premiums, helping to keep the policy in effect in later years
- Use all or a portion of the cash value to supplement your retirement income
Not all life insurance quotes are the same. Here are four questions to ask.
|The cash value in a whole life policy is guaranteed to grow at a specified rate no matter what happens to the markets. However, different life insurance companies have different ways of calculating that rate. Guardian offers whole life policyholders different options: for example, some of your policy value can be linked to the S&P 500 index.6,7||Some insurers are owned by stockholders, but a mutual insurance company is owned by its policyholders. So whole life policies from a mutual (such as Guardian) can actually earn an annual dividend – a portion of the company profits. Dividends8 can increase your policy value beyond the guaranteed growth rate. While mutuals don't guarantee dividends, Guardian has paid them every year since 1868.|
|Policies have optional provisions called riders, which can affect premiums9 but are often worth the added protection. For example, an accelerated death benefit rider lets you access a portion of the benefit amount if you have a terminal or serious medical issue. Waiver of premium enables you to stop paying your premiums for a time if you become unemployed or disabled10. And guaranteed insurability gives you the option to increase your coverage in the future without added medical exams.||A whole life policy does not just have to cover one person. For example, Guardian offers a "survivorship policy" that insures two people, typically a married couple, on one policy. With this policy, called EstateGuard, the cash value increases after the first person dies, and the benefit is paid to the beneficiary after the second person dies. Another unique feature allows the policyholders to add more coverage in the policy's early years.|
How whole life insurance compares to the other life insurance options
Compared to a term life insurance policy:
Whole life provides lifelong coverage and asset-building cash value. A term policy provides temporary coverage, typically for 10 to 30 years, and there's no cash value – when the term ends, there's nothing left. Term life insurance rates are typically much lower for a given level of protection. On the other hand, with a whole life policy, you or your beneficiaries are assured of an eventual payout, so as you pay premiums, you may feel you're getting more value.
Compared to a universal life insurance policy:
This is the other primary type of permanent insurance coverage, and it offers more flexibility but fewer guarantees than a whole life policy.11 Like whole life, universal life insurance builds tax-deferred cash value, but the premiums are flexible: you can raise or lower your payments as you see fit, within the policy limits.12 This can provide added flexibility to people with varying incomes, although paying in less can diminish the policy's cash account growth and could eventually result in the need to pay more later on to keep your coverage.
A whole life policy is the only type of life insurance with these three guarantees
|The death benefit is guaranteed never to decrease||The premium payments are guaranteed never to increase||The cash value is guaranteed to grow at a set annual rate|
Factors that affect the cost of a whole life insurance policy
The coverage amount affects whole life insurance rates in an obvious way: the bigger the death benefit, the higher the premium. But many other factors come into play as well, including:
Good health and life expectancy lower the cost of insurance, so the younger you are, the less you'll typically pay for a policy.
According to the Centers for Disease Control, in 2018, the average life expectancy for men in the U.S. was 76.2 years, while women averaged 81.2 years. A longer life equals more monthly premiums paid, which leads to lower rates per month.
Whether you smoke, vape, or dip, using tobacco increases your medical risks and life insurance costs. Tobacco users often pay two to three times as much for life insurance as non-users. If you quit using tobacco, you will usually need to be tobacco-free for at least a year to qualify for non-smoking rates.
Risky occupations and hobbies
Certain work environments, such as oil rigs, have hazards known to increase death or injury risk, affecting rates. Similarly, certain hobbies, such as scuba diving, can also lead to higher rates.
When you apply for a policy, there is an "underwriting" process in which life insurance companies assess mortality risk based on the factors noted above, as well as your medical condition. You'll likely be required to answer health questions and take a medical exam before a policy is approved. After assessing the results, the insurance company will assign you to a classification, such as Preferred Plus (lowest rates), Preferred, or Standard (higher rates). These classifications vary somewhat by insurer, and it's important to remember that no life insurance company expects every prospective customer to be in peak medical condition.
The company behind your policy matters. Here's why.
Whole life insurance is a life-long financial asset that can help get you through difficult times – and take greater advantage of the good times. So, you want to buy life insurance from a company you have confidence in. While all large, nationally known insurers may seem alike, they aren't. Few have been around for over 160 years, as Guardian has been. And policies can vary in ways that make a significant difference. For example, Guardian offers cash value growth options that other insurers may not offer and has unique products like a survivorship policy that can cover two spouses. Underwriting methods may also be distinct. For example, Guardian will offer policies for healthy people living with HIV, but other companies may not. In addition to these more subjective criteria, there are objective measures that can help you decide which insurers you want to work with:
- High Financial Strength Ratings: Independent companies rate the financial strength of insurance companies to evaluate their ability to meet obligations. Look for strong ratings from the various rating services for the insurance industry.
- High customer satisfaction scores: There are customer surveys and reviews that can tell you how satisfied others are with a company's services.
- Low customer complaints: State regulators and private organizations collect and publish data on customer complaints.
- Product selection and customization: Some companies focus on term life insurance, while others offer term, whole, and universal coverage that can be tailored to your needs.
- Policyholder dividends: Mutual companies may pay a dividend on the cash value of their permanent policies. Others may not.
- Direct underwriting: Some companies issue their own policies, while others issue other companies’ policies.
Ready to get started? A Guardian Financial Representative can help.
Talk to someone who will listen to your needs, help you determine how much coverage you need, and explain more about different whole life insurance options.
Frequently asked questions about getting a whole life insurance policy.
Why do people buy whole life insurance?
Whole life insurance coverage can help protect your family for your entire life. From the first day you're covered, a death benefit will help provide for your family's needs if something happens to you. And over time, the life insurance policy builds cash value, providing added financial protections and benefits.
How does "cash value" work?
With cash value life insurance, every time you pay a premium, a certain portion is set aside to grow. Over time, it grows tax-deferred into a meaningful sum of money: you can borrow against it; you can use it to pay for all or a portion of your life insurance premiums later on; or you can use your cash value to help pay for living expenses in retirement.
Does whole life insurance cost more than term life insurance?
Like other permanent life insurance policy types, whole life insurance may appear to be more expensive than a term life insurance policy that covers you for a defined period. However, it provides lifetime coverage, and over time whole life insurance may be more economical because the premiums do not increase with age. In addition to lifelong protection, you build cash value with whole life; term insurance doesn't.
Can I get whole life insurance if I have HIV?
Guardian offers whole life insurance policies to healthy people living with HIV under certain conditions:
- Between ages 20 and 60
- On highly active anti-retroviral therapy for two or more years with favorable lab results
- Free of any AIDS-defining illnesses
- Under the care of a doctor specializing in HIV