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How Life Insurance Works in New Hampshire
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Types of New Hampshire Life Insurance
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Term Life Insurance
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Permanent Life Insurance
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New Hampshire Life Insurance Laws
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The Cost
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New Hampshire Life Insurance Resources
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FAQs
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EZ Can Help!
How Life Insurance Works in New Hampshire
If you decide to buy life insurance, you will be entering into a legally binding contract with the insurance company of your choice. You must agree to pay the necessary premiums to the company in exchange for your loved ones receiving an agreed-upon lump-sum payment if you die while your policy is still in effect. This death benefit can be used by your beneficiaries for anything they want. From mortgage payments to retirement or college savings to replacement for your income.
If you have dependents, debts, or other financial obligations that must be met even after your death, you should seriously consider purchasing life insurance. But having life insurance is especially important if you are the primary or sole provider for your family. Your policy will ensure that your loved ones can maintain their current standard of living if you die unexpectedly.
Types of Life Insurance Available in New Hampshire
There are so many different types of life insurance policies available today that almost anyone can find one that is right for them. There will be many decisions to make regarding your policy. But the first one will be between the two main types of policies:
- Term life insurance
- Permanent life insurance
To make this decision, consider how far into the future you anticipate needing the coverage. As well as how much you’re willing to spend.
Term Life Insurance
Term life insurance tends to be more popular than permanent life insurance because of its more affordable premiums. Premiums for term life tend to be cheaper because this type of policy will not remain in effect indefinitely. Instead, when you buy term life insurance, you choose the length of time you want to be covered for. A policy’s term typically lasts for 15 years. But you can find policies with terms as short as one year or as long as 30 years.
With most term life policies, the amount that you pay monthly for your premium won’t change for as long as you have your policy. If you pass away while the policy is still active, your beneficiaries will receive a tax-free death benefit.
There are several types of term life policies available, including:
Level Term Life Insurance
Both the amount of the death benefit and the amount of the premium payments for level term life insurance are set at the time of purchase. They won’t change at any point. This is the most popular type of term life insurance policy.
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
The death benefit of an increasing term life insurance policy will increase over the course of the policy’s term. For example, your death benefit might go up by 5% each year. Unlike with other types of term life policies, the premiums for term insurance will change over time.
Decreasing Term Life Insurance
The death benefit associated with decreasing term life insurance decreases over the course of the policy’s duration, while the premium stays the same. These types of policies are usually purchased for protection while paying off a loan or mortgage. The death benefit will decrease in value as the loan is paid back.
Return-of-Premium Life Insurance
Return-of-premium (ROP) insurance is a form of term life insurance in which the premium payments you make are reimbursed if you don’t pass away prior to the expiration of the policy. The cost of ROP policies is significantly higher than that of other types of term life policies, but many people find the prospect of getting their premiums back appealing enough that it outweighs the extra cost.
Permanent Life Insurance
Unlike with term life, your permanent life insurance policy will remain in effect for the rest of your life as long as you continue to make your premium payments. Because of this, and because permanent life insurance policies usually include a type of savings account that accrues interest (known as cash value), premiums are usually higher for permanent life than for term life.
There are numerous permanent life insurance policies to choose from, including:
Whole Life Insurance
Whole life insurance not only provides a set death benefit, but it also includes a savings component, meaning you will accrue a cash value when you pay your premiums. Interest will also be accrued on a tax-deferred basis at a predetermined rate throughout your policy’s term.
Universal Life Insurance
This type of policy is very flexible, because you’ll have the ability to adjust both the amount of the death benefit and the amount of the premium payments. Your premium payments will go toward both the cost of insurance (COI) and the cash value. Eventually, as your cash value builds up, you’ll be able to use it to pay your premiums. You’ll also be able to lower your premiums by choosing to lower the value of your death benefit.
Indexed Universal Life Insurance
The cash value of an indexed universal life insurance (IUL) policy can grow based on investments tied to a stock index. The premium for an IUL can be adjusted in the same way that a universal life policy’s premium can be adjusted: it can increase or decrease with the cash value of the policy. It’s possible that one day you won’t have to pay a premium at all, because the cash value will pay for the whole thing.
Variable Universal Life Insurance
The cash value of a variable universal life (VUL) policy, like the cash value of other universal life insurance policies, can be invested, but VUL policies include investment subaccounts that are similar to mutual funds. And, as with traditional universal life insurance, you’ll be able to adjust your premium payments based on how much cash value you have accrued.
Final Expense Life Insurance
A final expense life insurance policy is a type of whole life insurance that pays out a modest death benefit, usually between $2,000 and $35,000. The death benefit from final expense insurance is meant to cover final expenses such as a burial, cremation, or funeral service. But your beneficiary will be free to spend the death benefit however they see fit, such as on a trip or the payment of their taxes.
This type of policy is often a good choice for those who are older or in poor health, because you will not be required to undergo a medical exam to get a policy or wait for coverage to begin. Be aware, though, that these policies are often more expensive than comparable policies, and, again, the death benefit tends to be relatively small.
New Hampshire Life Insurance Laws
New Hampshire has life insurance laws in place to protect consumers. The primary regulating force behind the state’s insurance industry is Title 37 of the New Hampshire Revised Statutes, but other legal provisions have also been adopted as consumer protection laws. The New Hampshire Insurance Department is in charge of issuing regulations and monitoring the behavior of insurance companies.
The following are the most important rules that may apply in your situation:
Free Look Period
In New Hampshire, the free look period is ten days after purchasing a policy, as required by Title 37. During the free look period, you’ll have the option of returning your policy for a full refund, with no fees or penalties. This trial period allows new policyholders to determine whether the policy meets their needs.
Grace Period
The grace period after missing a premium payment in New Hampshire is required to be at least 30 days. As long as you make up for your missed payment in these 30 days, your insurance company cannot terminate your policy or deny a claim if one is filed. The grace period helps to keep policies from lapsing, which would necessitate new underwriting and likely result in higher premium costs.
Benefit Guarantee
The New Hampshire Life & Health Insurance Guaranty Association exists in New Hampshire to pay beneficiaries if an insurance company declares bankruptcy and is unable to make payments. While this safety net exists, it has limitations. The total death benefits guaranteed are $300,000 per person, and the total amount of cash value protected is $100,000. This means it’s important to only purchase life insurance from reputable and financially healthy insurers.
Settlement Timelines
New Hampshire, like all states, requires insurance companies to pay all claims in a timely manner. Failure to pay within a reasonable time frame may result in fines, penalties, or other sanctions being imposed on the insurance company. If an insurance company takes more than 30 days to pay a claim, interest will begin to accrue. This means that most claims in New Hampshire are resolved in less than two months.
The Cost
There are a number of variables that can impact the price of your premiums, including your age, current health, and even your gender. Get in touch with one of our EZ agents to receive the quickest and most accurate information regarding potential costs. If you provide them with some information, they will be able to use that information to find you free quotes that are tailored to you.
But to give you an example of how much you might pay, a 34-year-old non-smoking man in good health could pay anywhere from $19 to $55 per month for a 20-year $808,000 policy in New Hampshire.
New Hampshire Life Insurance Resources
In New Hampshire, there are several state resources available that can help you if you have any problems with your insurer or policy. These resources include:
- New Hampshire Insurance Department – Start with the New Hampshire Insurance Department if you need help with a policy. To ask a question or check the status of a license, contact the Consumer Services team by phone or email. The department also provides online tools to assist you in finding policies, reporting fraud, and filing complaints.
- New Hampshire Life and Health Insurance Guaranty Association – When comparing insurance companies, see if they are members of the New Hampshire Life and Health Insurance Guaranty Association. If your insurance provider goes bankrupt, this organization will pay you. But your insurer must be a member for you to qualify.
- New Hampshire Estate Planning Council – The New Hampshire Estate Planning Council connects customers with reputable estate planners who can assist you in directing your life insurance benefits to the appropriate person.
FAQs
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Does New Hampshire require life insurance?
No, you will never be forced to get life insurance. It is always your choice.
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What are the best life insurance companies in New Hampshire?
There are a lot of good ways to get life insurance in New Hampshire. At the top of the list are Northwestern Mutual, Lincoln Financial, Mass Mutual, New York Life, and John Hancock.
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How much does life insurance cost in New Hampshire?
There are many things that can change how much life insurance costs, but here’s an example. A healthy 34-year-old woman in New Hampshire will pay an average of $28.85 per month for a 20-year term policy that costs $808,000 and lasts for 20 years. On the other hand, a healthy 34-year-old man will pay about $32.20 for the same policy.
EZ Can Help!
We at EZ know that everyone has unique requirements, priorities, and financial constraints. We also understand that you want the best for your family without depleting your savings account. So, we make every effort to simplify the process of purchasing life insurance, and guarantee that all of our services will always be completely free. You will not be charged any additional fees for assistance with anything. Including 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.
