Purchasing life insurance is one of the best things you can do to protect your family’s financial future. Looking for a policy can feel overwhelming, there are so many policies out there and so many regulations to be aware of. But don’t worry, EZ is here to help you sort through everything. First, read our comprehensive guide to the life insurance market in the state of Kansas. Then speak to one of our agents, who can answer any questions and help you find the right policy for you.
How Life Insurance Works in Kansas
If you choose to purchase a life insurance policy, you will be entering into a contract with your chosen insurance company. You agree to pay the required premiums. Then if you pass away during the term of your policy, your beneficiary(s) will receive a tax-free, lump sum death benefit. They will be able to use the money for whatever they choose. From repaying a mortgage or other loan, saving for retirement or college, or simply to replace your income.
Types of Kansas Life Insurance
There is such a diverse selection of insurance providers and life insurance policies to choose from that you are sure to be able to find a policy that is right for you, your family, and your budget. But, because there are so many options out there, you’ll have to make a lot of decisions. The first will be between the two main types of life insurance:
- Term life insurance
- Permanent life insurance
When making this decision, you’ll have to consider how long you want the policy to cover you. As well as how much you are willing to spend on premiums.
Term life insurance is generally more affordable than permanent life insurance, so it has become the more popular choice. This type of policy is cheaper because it does not cover you indefinitely. Instead, when you buy term life insurance, you will be able to choose the length of time that you will be covered by the policy. The term length of one of these policies will typically be 15, 20, 25, or 30 years.
Another positive aspect of term life is that, in most cases, your monthly premiums are guaranteed to remain the same for the entire term of your policy. If you die while the policy is still in effect, your beneficiaries will receive a tax-free, lump sum death benefit.
There are several types of term life insurance policies available, including:
Level Term Life Insurance
The death benefit and premiums for level term life insurance remain constant throughout the policy’s term. The majority of people who purchase term life purchase level term life insurance.
Annual Renewable Term Life Insurance
Annual renewable life insurance is a one-year term life insurance policy. You will be able to renew your policy on an annual basis, but the premiums will rise with each passing year.
Increasing Term Life Insurance
An increasing term life insurance policy’s death benefit increases steadily over the course of the policy’s coverage period. For example, your policy’s death benefit could rise by 5% each year. Unlike with other term life insurance policies, the premiums for increasing term insurance may increase or decrease over the policy’s term.
Decreasing Term Life Insurance
The death benefit associated with this type of policy will gradually decrease over the course of the policy’s term. While the premium will remain the same. A policy like this is commonly purchased for coverage while paying back a loan or mortgage, and the death benefit will gradually decrease as the loan is repaid.
Return-of-Premium Life Insurance
Return-of-premium (ROP) insurance refunds your premiums if you don’t die before the end of the policy’s term. Many people find the return of premiums feature appealing. However, you should be aware that the cost of ROP policies is significantly higher than that of other term life policies.
Permanent Life Insurance
Term life and permanent life insurance differ in a few ways. First, if you choose a permanent life insurance policy, it will remain in effect for the rest of your life. As long as you continue to pay your premiums on time. Next, permanent life policies also usually include a cash value. Which is a type of savings account that accrues interest, and that you can borrow against or even use to pay your premiums. Finally, because of these features, premiums are typically higher than those of term life policies.
There are numerous types of permanent life insurance policies available, including:
Whole life insurance provides a guaranteed death benefit as well as the ability to accumulate cash value. This cash value will earn interest at a fixed, tax-free rate.
This type of policy is a very flexible type of life insurance. With universal life (UL), you can change the amount of your death benefit as well as the amount of your premium payments at any time. You can choose to lower your premiums by lowering the amount of your death benefit. Or you can put the money in your cash value toward your premiums, thus lowering your payments.
Indexed Universal Life Insurance
Indexed universal life (IUL) insurance is another type of permanent life insurance with a cash value. But its cash value accrues interest through investment in a stock index. Which is a predetermined grouping of different stocks. An IUL premium is flexible in the same way that a universal life policy premium is. It rises and falls in tandem with the policy’s cash value. Eventually, you might not have to pay a premium because the cash value will cover it all.
Variable Universal Life Insurance
Like the cash value of other types of universal life insurance policies, the cash value of a variable universal life (VUL) policy can be used to make investments, but you will be able to invest in subaccounts, which are similar to mutual funds. Premium changes are possible with this type of policy, just like with traditional universal life insurance.
A final expense insurance is a type of whole life policy that pays out a relatively small death benefit, usually between $2,000 and $35,000. The death benefit from final expense insurance is intended to pay for final expenses such as a burial, cremation, or funeral services, but your beneficiary will have complete control over how the death benefit funds are spent. The funds could be used to pay the beneficiary’s taxes or for a vacation, for example.
These policies have pros and cons. They can be a good option if you’re older or in poor health, since they don’t require a medical exam and generally go into effect immediately. But they can be more expensive than other comparable policies, and the death benefit is generally fairly small.
Kansas Life Insurance Laws
When it comes to life insurance, the federal government generally leaves consumer protection and insurance industry regulation up to the individual states. So, life insurance policies are protected by the laws of the state of Kansas. Although the Kansas Insurance Code (Chapter 40 of the Kansas Statutes) serves as the state’s primary insurance code, other consumer protection laws have also been enacted. The state of Kansas is regulated by the Kansas Insurance Department, which has its own set of administrative laws.
Free Look Period
A “free look” period is a period of time after purchasing a life insurance policy during which you can “test drive” your life insurance policy. You will be allowed to cancel your policy for any reason during this period, which is usually between 7 and 30 days. In Kansas, though, there is no state-mandated free look period. Having said that, most insurance companies in Kansas allow a free look period with most life insurance policies.
Most states also mandate a grace period, or a period of time between missing a payment and your policy being canceled. The grace period in Kansas is 30 days, as is the case in the majority of states. This means your policy cannot be canceled during this time, and if you die during this time, your insurance company will still be required to make a payout.
If you have life insurance in the state of Kansas, the Kansas Life & Health Insurance Guaranty Association will protect your policy in the event that your life insurance provider goes out of business. This organization will reimburse you for up to $300,000 in death benefits and $100,000 in cash value. In order to collect on this payment, you must be current on your premium payments, and your life insurance company must have been officially licensed to conduct business in the state of Kansas.
Your age, your overall health, and even your gender can all have an effect on your premiums, so it’s important to consider all of the factors that could apply to you. Get in touch with one of our EZ agents to get free personalized quotes that are tailored specifically to you and your requirements. But to give you an example of prices, a 30-year-old man in good health who does not smoke could pay anywhere from $16 to $65 per month for a 20-year $661,000 policy in Kansas.
Kansas Life Insurance Resources
In Kansas, there are several resources in place to help you if you have any problems with your insurer or policy. These resources include:
- Kansas Insurance Department. – Residents of the state who have questions or concerns about their insurance policies are encouraged to contact the Kansas Department of Insurance for assistance. Policyholders, beneficiaries, and anyone else who is interested in learning about their legal rights in Kansas can take advantage of the department’s educational resources and advocacy efforts. It serves as an objective source of information for consumers.
- National Association of Insurance Commissioners – Beneficiaries who are unable to locate a policy on their own may submit a search request to the National Association of Insurance Commissioners (NAIC) policy locator service. Through this service, you can have a participating life insurance company look through their files for any applicable life insurance policies or annuity contracts using the name of the person who passed away as the search criteria.
- Kansas Life & Health Insurance Guaranty Association – When an insurance company goes bankrupt, the state’s guaranty association steps in to protect policyholders. If your insurer goes out of business, you may be eligible for coverage through this private organization for up to $300,000 in lost death benefits and up to $100,000 for a policy’s lost cash value.
Does Kansas require life insurance?
No, you will never be forced to get life insurance. It is always your choice.
What are the best life insurance companies in Kansas?
There are a lot of good ways to get life insurance in Kansas. At the top of the list are AIG, Genworth, Pacific Life, Prudential, and Protective.
How much does life insurance cost in Kansas?
There are many things that can change how much life insurance costs, but here’s an example. A healthy 30-year-old woman in Kansas who buys a 20-year term policy for $661,000 will pay an average of $27.11 per month. On the other hand, a healthy 30-year-old man will pay about $32.74 for the same policy.
EZ Can Help!
At EZ, we get that everyone has unique requirements, priorities, and financial constraints. We also understand that you want to keep your family financially secure without depleting your savings account. So, we make every effort to simplify the process of purchasing life insurance for you, and we do everything for free. You will not be charged any additional fees for assistance with anything, from answering basic questions to navigating policy selection to the enrollment process and beyond. Simply enter your zip code in the space provided below or call us at 877-670-3560 to get started.