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Checkout the special spreadsheet that assists you calculate the total FEGLI cost over your career along with the article Low Cost Term Life Alternative to FEGLI Option B.
FEGLI Option B Vs Private Life Insurance
Federal Employees Group Life Insurance Program also known as FEGLI; is a group life insurance administered by Met Life. This Plan is set up when you start your Federal career. FEGLI is a reasonably priced plan with good coverage when started at a young age. However, the premium in this plan increases every five years starting at age 35 and becomes prohibitive starting around age 50.
We advise all federal employees that are in average to good health to seek options on the private market and compare with their FEGLI policy. The cost of a FEGLI option B policy is outrageously expensive compared to private market options. The FEGLI Option B plan is a term life insurance policy that is administered at group rates and the price goes up every 5 years. Under a group program the enrollment is guaranteed as long as it is done during open season, and the healthy employees pay more in premiums to offset the risk of insuring unhealthy employees.
The FEGLI Option B policy is a term life policy so it does not build any cash value and the policy does not guarantee your loved ones will receive a death benefit. The federal employee is hedging their bets to see if they pass away during the allotted time period, if they do then their family will receive the death benefit.
A permanent life insurance option on the private market not only will guarantee the beneficiary will receive their death benefit but it will also build cash value for the federal employee if they need to borrow against it in an emergency. This program also ensures that estate taxes will be paid and final wishes will be taken care of.
The cost for a federal employee that is a 45 yr old male for $250,000 of FEGLI Option B coverage that covers him to age 75 will cost a total of $88,400. If that employee does not die before age 75 he just paid $88,400 for nothing. If that same man purchased a permanent life insurance policy at age 45 for $250,000 he would still have only paid $59,000 in premium by age 75 but would also have a guaranteed cash value built up of $16,000 and more importantly his death benefit is in place for the rest of his life.
Buy a Low Cost Privately Owned Term Life Insurance Policy
To start with review and understand your life insurance requirements. Figure out if you really need life insurance at this point in time or not. If you don’t have any dependents, then don’t go in for life insurance policy.
Get an instant online quote here on LifePolicyShopper.com. Make sure you consult an independent insurance agent/broker to get an unbiased understanding of the market. We are in a better position to synchronize your unique insurance requirements with the most affordable options available. Even after procuring the policy we will help in getting the most out of the plan.
Go the Online Way! Some of the cheapest life insurance quotes come from online insurance companies. This is because they have lower overheads as compared to traditional service providers. Also, the fact that it is easier to compare plans and rates over the internet puts additional pressure on these online vendors to downgrade their quotes.
Shop, Compare and Bargain Hard! Explore the market thoroughly. It would be one effort you will not regret. Gather the quotes for different coverage tiers in line with your requirements and then compare them judiciously. Ensure that you compare apples to apples! Keep in mind that a quote that comes with the lowest initial payment might not be the cheapest one. When you talk about life insurance, think long term. A policy with a higher premium might be a value for money plan. Once you have short-listed your best picks, it is time to sit down with the respective insurance companies and negotiate the best price. Remember, information is power – if you know the market, you can bargain hard and get the lowest possible quote.
At the end of it all, do remember that life insurance is not a mere cost, but an investment that you are making to secure your family. So, try to decide on the coverage and then try to minimize the cost.
Buying Life Insurance is not an event – it’s a process
You should approach purchasing a low cost life insurance policy as a process that is going to take you about 4 to 5 months.
1. Online research phase.
Take a look and compare term life insurance policies here at LifePolicyShopper.com Comparing life insurance prices online is as simple as using our modern online instant life insurance quote engine. Now the question then becomes, can you qualify for those life insurance prices?
Prices for life insurance vary between underwriting classes. There are 5 major health classifications you can qualify for in life insurance:
Substandard (Table 1 – Table 8)
It’s important to understand that life insurance underwriters will ALWAYS offer the best possible rate class given their findings on your application, medical exam and medical records…no matter what rate class you apply for.
Most people believe they’re healthy and will automatically pick the “Preferred Plus” health classification. In fact over 65% of quotes on our website are run at “Preferred Plus” rates. However, industry-wide studies show less than 5% of the population can actually qualify for this health classification.
Our point here is when you’re comparing prices for life insurance; your health classification is the one variable that you don’t know. How can you know since every life insurance company looks at your risk differently?
That’s where we come in.
If you hover over the “health class” on our life insurance price quoter, you’ll get a quick suggestion on how to rate yourself. No one else on the internet strives to give you this “at a glance” information like we do.
If you have any health issues, you’ll want to give us a call or fill out our quote request form and we’ll contact you.
We can provide you with the best rates.
Online Life Insurance Prices Are Not Created Equal
• Many life insurance websites don’t sell life insurance – they simply sell your information to other life insurance agencies. We are licensed agents to help you find the lowest priced life insurance policy. If you request an application or a phone call, one of our experienced life insurance agents will be calling you.
• Our instant life insurance quotes show all the top rated life insurance companies in a side by side life insurance cost comparison. We’ve invested the money to make it easier to compare pricing, financial ratings and even change your quotes on the fly to fit your budget.
• We provide you accurate and up to date life insurance rates from the nation’s top rated carriers. If there’s a rate increase or reduction, our software reflects those changes as soon as they’re released.
• Our application process is efficient. 90% of our carriers allow us to do business electronically. Meaning you don’t have to fill out a long life insurance application – we actually complete the application with you over the phone and send it to you for an e-signature. It doesn’t get much easier than that!
2. Application phase.
After receiving your quotes, you can choose to apply online from the comfort of your own computer without speaking with an agent. You’ll be asked a series of yes/no health questions. Enter your payment information. If you’re approved, your policy will be in force IMMEDIATELY and your first premium will be drafted. If you’re not approved, nothing will be drafted. E-sign your application. Our system will automatically send you an email with a link to “e-sign” your application. Click on the link and follow the prompts (it’s very intuitive). Wait 2-5 minutes for the system to run your Motor Vehicle Report, Pharmacy Report and Medical Information Bureau (MIB) report and make a decision on the application. At this point we’ll schedule your para-medical exam.
3. Para-medical exam phase.
You can choose the date of your para-medical exam. Here are some tips to completing a successful medical exam.
In the days leading up to the medical exam for life insurance watch your diet closely.
Focus on eating things that improve your blood work. Leafy greens, such as spinach, broccoli, kale, chard and salads, help to lower your blood pressure and cholesterol levels. How important are low cholesterol and blood pressure numbers? Elevated blood pressure and cholesterol levels are the number one reason life insurance applicants come back at a different rate class than originally quoted. If you believe you may have issues with your blood work, consider no medical exam versus exam life insurance where there is no blood draw.
Drink a lot of water in the day leading up to your life insurance physical exam. This will flush out your system and make it easier for your examiner to draw blood. That is right, plenty of water makes for full veins, and full veins make it easier for the nurse to find a vein that can be used. (Have a fear of needles? Consider a no medical exam versus exam policy). Limit coffee, which acts as a diuretic and causes you to urinate more. And completely avoid coffee the morning of your medical exam for life insurance as it can cause elevated blood pressure.
Exercise can elevate your blood pressure and may also cause elevated proteins in your urine. Life insurance health exam tip: Lay off the exercise for 24 hours before your exam to make sure your body is clear of any potential issues.
Also, consider laying off of the supplements (such as creatine) for a few days. At times, creatine in the urine can cause an underwriter to offer a rate other than applied for. This leads to the client having to retest with their primary care physician to show that they have no health issues. Retesting causes additional time and money. Avoid this scenario by laying off the supplements (whey and casein protein powders, creatine, etc…) for a day or two before your life insurance physical exam.
No alcohol (think beer and liquor) for 24 hours before your medical exam for life insurance. Alcohol is high in calories and sugar and has a direct effect on triglycerides (However, a small glass of wine might benefit you, see HDL above). Plus, it does not look good to have blood work or a urine sample high in alcohol levels. Instead, take 24 hours to detox before your exam for life insurance.
Please fast for at least 8 hours prior to your health exam.
When preparing for your para-medical exam it is important to fast. If you do not fast you risk elevated blood sugar levels and blood pressure levels. The last thing you want is a false positive on your life insurance physical exam. If you are concerned about fasting for 8 hours, consider taking your life insurance exam first thing in the morning. That way you can simply fast in your sleep, wake up and take your exam.
The morning of your paramedical exam:
The day of the physical exam is here. By now you should be able to answer the question: “How do I pass my life insurance health exam?” However, there are a few more life insurance medical exam preparation tips to be aware of:
The morning of your life insurance medical exam you should have a glass of water in expectation of a urine sample, but no breakfast or coffee until after the examiner has taken your labs. You want your body to be free of anything that could affect your lab results. Better to avoid coffee and breakfast that to take the chance that your lab results from you life insurance exam come back other than stellar.
Wait to take your blood pressure if you feel overly stimulated. Sometimes the idea of a health exam for life insurance can cause people’s heart to race. If you find your heart racing, wait to have the examiner check your blood pressure until you have calmed down.
If you have an EKG scheduled, make sure you have a couch to lay down on. Give the paramedical examiner a moment to set the machine up properly.
Dress in light clothing. Sometimes the difference between one rate class or another is one measly pound. Don’t take any risks on your medical exam for life insurance. Wear shorts and a t-shirt. A sweater can weigh as much as two pounds. Deal with the cold and ditch the sweater, at least for the exam.
Finally, when the examiner measures you, stand up nice and tall. Life insurance carriers use a build chart to determine what rate class you qualify for. The taller you are the more weight you can carry. Stretching your neck out for one more inch could mean hundreds of dollars in savings!
Once the examiner is done administering your life insurance medical exam they may ask some additional questions about your health history. This will depend on the particular carrier and on how much information you submitted to your life insurance agent prior to taking your life insurance physical exam.
The examiner will then submit your labs to a lab processing company. And that company will process your lab work; screen your blood and urine for any negative health markers or drugs.
The lab processing company will then submit the findings to the life insurance underwriter. At times, an attending physician statement from your doctor or doctors will also be requested.
The life insurance underwriter will then review your lab results and offer you life insurance based on those results. Your results will determine your rate class: Preferred Plus, Preferred, Standard Plus, Standard and Table Rated (B-H).
4. Final policy determination and acceptance or look at a different company with a better rate.
Once the para-medical phase is complete you will receive written confirmation on the medial rating the insurance company placed you in. At this point you can accept the rating and sign the policy or reject it and work with us to find another carrier that will be more favorable based on your para-medical exam results. If we find that you were close to some lab results or height/weight limits we can always appeal the results to the carrier on your behalf.
5. Final acceptance.
Once you’re satisfied with your rate you can e-sign the policy.
Like we said – buying a private fully underwritten life insurance policy is a process – not an event. Now that you’re aware of what to expect over the course of this process feel free to begin with an online quote. If the process for a fully underwritten policy is not for you, let us find you a no exam life insurance policy.
Check out our article on the TOP 10 REASONS to REPLACE FEGLI.