Located in one of the beltway-ish suburbs of Boston, The Savings Bank Life Insurance Company of Massachusetts or SBLI as it’s more commonly known is a somewhat unique little insurance company with a reputation for two main accomplishments:
1. Having one of the highest 20 year internal rates of returns on its participating whole life policies
2. Having some of the most competitively priced term insurance on the market
The first accomplishment is a topic for another day. Today we’ll discuss SBLI’s position as a player in the term at the lowest possible price game.
The No Nonsense Company
The homepage of the SBLI web site is laser focused on one thing, helping you buy life insurance (preferably from them). It includes a term quoting engine–so you can see their rates–and a three step guide to help you: research, compare, and begin the purchasing process.
SBLI’s term products are also very straight forward. They have level term products available in 10, 15, 20, 25, and 30 year level periods. Riders include a child coverage rider and waiver of premium–that’s it. The waiver of premium covers the insured to age 65, but I suspect the fierce term spread sheeting agents out there would be quick to remind me that few people purchase waiver of premium on term insurance, especially when opting for the lowest possible price on a policy under $1 million. No, waiver is only for those stuffy mutual sales agents who sell already overpriced term insurance (wink wink).
You can purchase SBLI’s term in amounts as little as $100,000 and as much as $30,000,000 (in several states the cap is$20,000,000). The company’s internal retention is $500,000. The product is convertible to permanent products to age 70 or until the end of the level period.
The No Nonsense Health History
We’ve mentioned before that some of the spreadsheet leaders tend to have tougher than average underwriting practices, and SBLI–as a spreadsheet leader–is no stranger to this commonality. If you don’t have a stellar health record SBLI may not be your best bet. If on the other hand you do have a nearly flawless medical history good fortune may smile upon with cheaper life insurance rates.
Just be ready for a somewhat slower than usual underwriting time line. SBLI has become pretty innovative in their approach to accepting applications, but they sometimes lag in application turn around. They are a small company with a large national (minus a few states) marketing focus (i.e. they are busy). It’s not a deal breaker by any means.
Not to be Confused with SBLI Mutual of New York
If you’re out searching the internet for more information on SBLI, you may run into some information regarding a similarly named Savings Bank Life Insurance Co. of NY. This company (whose founding was based off the original marketing plan behind SBLI of Mass) is a separate company that operates in the State of NY. It’s also a company in a somewhat scary financial situation right now, but please don’t confuse the two as they have nothing to do with each other.
Not a Bad Choice
For those looking for cheap term rates in great health, Savings Bank Life of Mass can be a pretty good choice. They won’t be a super competitive carrier for face amounts above $1 million in most cases, and they tend not to compete well in the 50+ market. As far as the cheap term carriers go, they are presently one of the few remaining carriers with a level term product that goes beyond 20 years.
They aren’t known for generous underwriting, so if you aren’t the poster child for good health you may do better elsewhere with carriers more well known for lenient underwriting. If you want some guidance on who those carriers are, please contact us.
Just like all other companies out there, SBLI has a market for whom they are an excellent choice, but they aren’t the 100% solution to everyone.