Best Life Insurance Companies in Chicago

FAQs

• What are the life insurance laws in Illinois that Chicago residents should have knowledge of?

  Under Illinois law, Chicago residents have two years from the policy's activation date to challenge the validity of their life insurance policies. Policyholders who cancel their insurance within the first 10 days are entitled to a full refund of the money they paid to carriers. In the event of a missed payment, policy owners have a 30-day grace period to bring their payments up to date before the insurance company can terminate the policy.

• What are some of the significant life changes that can prompt Chicago residents to review their life insurance policies?

  Policyholders in Chicago may consider revisiting their policies in the aftermath of major life events such as marriage or divorce. Furthermore, starting or expanding a business can prompt policyholders to review their coverage. Another reason for a policy review is if someone has recently refinanced their home mortgage or if their spouse has received an inheritance within the last six months.

• When can Chicago residents who are facing divorce proceedings change the beneficiaries of their life insurance?

  The same beneficiaries for life insurance policyholders in Chicago are frequently recommended by Illinois courts until the divorce is formally finalized. A divorce is legally considered final when a judge decrees it to be so. Changing the conditions of the divorce process can significantly complicate the situation.

• Is it against the law for an insurance company or agent to return a portion of the premium when a new insurance policy is purchased in Chicago or the state of Illinois?

  Yes, rebating is illegal under Illinois state law. Rebating is the practice of providing any type of reward, such as returning a portion of the commission or offering other incentives, with the goal of promoting the purchase of life insurance in Chicago as well as the rest of the state.

• Is life insurance divisible in a divorce in Chicago?

  No, according to the Illinois Marriage and Dissolution of Marriage Act, life insurance benefits are generally not subject to division during divorce proceedings because they are paid upon death. However, if some of the interest in a life insurance policy is marital property, equitable distribution may be required. Because Illinois uses an equitable distribution method, any portion of a life insurance policy that is deemed marital property will be allocated in a way that ensures fairness to both parties involved.

• Which is better, term or whole life insurance?

  Life insurance is a personal financial tool, so the right type of insurance for you depends on your goals and current situation. One of the main differences between term life insurance and whole life insurance is that term life insurance only covers you for a set period of time. Once you meet the premium payment requirements on a whole life plan, it covers you for the rest of your life. Whole life insurance also builds cash value, making it a potential investment. But whole life insurance is typically much more expensive than term life insurance.

• How much life insurance do I need?

  A common recommendation is purchasing life insurance that is equal to five times your current salary, or more. But you can also estimate how much life insurance you need by adding up your debts, annual expenses for dependents multiplied by the years you want to ensure support, and any other items you wish to cover, such as a future wedding or college tuition.

• How does life insurance work?

  The details of how life insurance works depend on your individual plan, but the basics are as follows: 

  • You pay a premium to purchase the insurance. Typically the premium is paid monthly, but it could be rolled into quarterly, bi-annual, or annual payments. 
  • As long as you are meeting or have met premium obligations, if you pass away, the insurance company makes the agreed-upon payment to the beneficiaries you designated. 
  • Beneficiaries usually have to provide the insurance company with a death certificate to receive their payments.

• How much is life insurance?

  The cost of life insurance ranges widely. Term life insurance can cost as little as a few dollars a day, and whole life insurance can cost thousands per month on the high end. Factors that impact the cost of your life insurance include whether you're choosing term life insurance or whole life insurance, your age, how much coverage you want, your overall health, and your gender.

• Is life insurance taxable?

  Life insurance proceeds are the funds paid via your plan to your beneficiaries if you pass away. These are also called death benefits. Typically, these are not considered income for taxes. If you take out cash value from a whole life insurance investment and the amount exceeds how much you paid in premiums, the difference may be considered taxable income.

  
  

• Can I buy health insurance that is not Obamacare?

  When people say "Obamacare insurance," they typically mean insurance within the health insurance marketplace. You can get health insurance outside of the marketplace by going through your employer, choosing COBRA coverage if you leave your job, or buying a short-term health insurance policy through an insurance agent. ACA-compliant plans meet all the benefits and coverage requirements of the Affordable Care Act. But you may be able to find supplemental or short-term coverage that simply provides peace of mind for major medical expenses.

• Can I buy health insurance anytime?

  To buy health insurance in the marketplace, you must purchase it within open or special enrollment periods. But you can purchase short-term coverage to bridge the gap between now and the next open enrollment period. These plans are meant to be used for less than a year. You can purchase them online or via insurance agents, but they may not be ACA-compliant.

• Who should buy supplemental health insurance?

  Supplemental health insurance is a product that helps cover the cost of services that your primary health insurance policy doesn't. One popular option is secondary insurance that helps cover some of the costs associated with high deductibles. Medicare supplemental insurance is also popular. Medicare doesn't cover everything, and older adults on a limited income can face large prescription or medical bills after Medicare pays. Supplemental insurance helps reduce those patient costs.