If you are in the market for life insurance, you have undoubtedly heard of SelectQuote. However, some people are surprised to learn that SelectQuote is not a life insurance company, but rather a life insurance broker.
Our SelectQuote Review will tackle all the details you need to know about SelectQuote before you purchase a policy with them such as:
If you are considering working with SelectQuote to purchase an insurance policy, you must read this review before committing to anything.
Is SelectQuote legit or a rip-off?
SelectQuote is a legitimate life insurance agency that uses some of the most highly-rated life insurance companies in the industry, which we discuss in greater detail later on. SelectQuote has the money and manpower to be the number 1 term life insurance sales agency in America.
SelectQuote does have some legitimate strengths. SelectQuote’s price comparison service is legit; although not different than what any other life insurance broker will do for you.
You can call SelectQuote, and they will compare the rates of their highly-rated insurance companies and try to place you with the best deal 100% over the phone. If you don’t want an agent in your home or there are no life insurance brokers in your area, this is a big plus.
Also, because SelectQuote is an independent agency, they are not incentivized to sell any proprietary products. Career or “captive agents” like State Farm can only sell their company’s insurance whether it is the best option or not.
Notwithstanding, these advantages are not unique to SelectQuote. Basically, they are just a giant independent life insurance agency. However, size and scale do have some disadvantages in the form of customer service, but without the benefit of lower prices!
Since life insurance rates are highly regulated, SelectQuote does not have a pricing advantage usually associated with large businesses. That’s right. A life insurance policy with SelectQuote will be the same cost as any other agent who brokers that company!
Disadvantages of Working with SelectQuote:
Why is working with a call center is a negative?
Call centers are a gamble. You never know who you are going to get on the other end of the line at a call center. It could be a rockstar who really understands the insurance business, or it could be someone on their first day.
This is critical because life insurers have very different opinions on underwriting and rates. The last thing you want is to go through a two-month application process, including a medical exam, just to find out you need to start all over again with a different company or pay a higher price.
You want to work with an agent who is a seasoned field underwriter who will get it right on the first shot. The life insurance industry has a huge turnover rate within the first few years of working in our industry. A call center environment just magnifies that problem.
A lot of our clients today purchased life insurance in the past and were orphaned when their agent left the business. Your life insurance needs are going to change over time. Establishing a long-term relationship with an insurance professional is a rare, but valuable thing.
Why does SelectQuote have a small number of life insurance options?
Quite frankly, we are not sure. SelectQuote, like our agency, regularly monitors the rates and customer service of the insurance companies they work with to determine if they still deserve a spot on their roster.
According to SelectQuote’s website, they look at the following criteria:
Every life insurance company that SelectQuote currently offers is rated between A- to A+ by third-party rating agency The A.M. Best Company. Said another way, all the companies that SelectQuote uses have rock-solid finances.
SelectQuote sells the following 12 highly-rated life insurance companies depending on state availability:
- American General Life Insurance Company
- Banner Life Insurance Company
- Companion Life Insurance Company
- Globe Life And Accident Insurance Company
- Pacific Life Insurance Company
- Protective Life Insurance Company
- Pruco Life Insurance Company
- SBLI of Massachusetts
- The Lincoln National Life Insurance Company
- Transamerica Life Insurance Company
- United of Omaha Life Insurance Company
- William Penn Life Insurance Company of New York
When I learned the companies that SelectQuote works with, I was initially surprised at how few life insurance options there were. To give you greater context, our agency works with over 25 life insurance companies compared to SelectQuote’s 12* life insurance companies.
*Companion Life and William Penn are sister companies of the United of Omaha and Banner Life that operate in New York State and essentially offer the same coverage.
After studying SelectQuote’s carrier lineup, I can see already spot some underwriting gaps, specifically if you are looking for no-exam life insurance.
Currently, the only express issue no-exam life insurance option that SelectQuote has is with the Mutual of Omaha, but its rates are not super competitive compared to the best no-exam life insurance companies.
There are a-rated no-exam life insurance companies like Sagicor Life that are leading the way in no-exam term insurance up to $500,000. We were shocked to learn that SelectQuote doesn’t offer them.
Another gaping hole in SelectQuote’s lineup is life insurance with living benefits for chronic and critical illness. Living benefits allow you to take an advance on your death benefit while you are alive for hard-hitting diseases like invasive life-threatening cancer.
SelectQuote offers Transamerica as a living benefits option, but their rates are not currently very competitive when stacked up against companies like the American National Insurance Company.
As far as SelectQuote’s lineup of fully underwritten term life insurance is solid. In fact, we use many of the same companies. If you are willing or need to take a medical exam, SelectQuote has the companies necessary to underwrite a wide range of impairments.
Does SelectQuote use high-pressure sales tactics like “upselling”?
Today, it seems like everyone is selling something. Even my dentist tried to upsell me on fluoride the other day. Make no mistake about it, SelectQuote is a for-profit business, and they need to grow to keep their investors happy.
SelectQuote encourages their agents to upsell life insurance or cross-sell other lines of insurance like home and auto. Now a sales culture can be a noble thing when used appropriately.
Often, clients may underestimate the amount of life insurance they need. Guiding them into making a sound financial decision is different than over insuring someone. However, if an agent is under pressure to make your sales quota, they may use more aggressive sales tactics.
I fielded a call from a client who was considering working with a call center agent not long ago. After reviewing what they proposed, we determined that she was dramatically over insured. We ended up crafting her a more appropriate (and less expensive) insurance plan.
SelectQuote was founded in 1985, over 34-years ago, and is located in San Francisco, CA. SelectQuote revolutionized the way term life insurance was sold by offering a comparison service over the phone to quickly and easily compare prices.
While purchasing life insurance over the phone and internet is not really revolutionary today, in the 1980s, this was a big deal. SelectQuote used direct marketing, including radio and television advertisements, to promote their call centers.
As technology improved, so did SelectQuotes customer service. SelectQuote’s technological edge helped streamline a lengthy paper application process. Over time, SelectQuote branched out into other lines of insurance such as Medicare insurance and auto and home coverage.
Today SelectQuote is the number one term life insurance sales agency in the United States! SelectQuote is a private company owned by investors like Brookside Equity Partners, but not owned by or affiliated with any one life insurance company.
Is SelectQuote good for seniors?
SelectQuote is a mixed bag when it comes to seniors looking for insurance. It greatly depends on what type of insurance you are looking for, your health, and where you live.
While SelectQuote started with life insurance, it eventually branched off into other lines of insurance. SelectQuote expanded into the senior insurance market by offering price comparison services on Medicare insurance
Selectquote sells medicare insurance plans through its Selectquote senior brand but maintains its senior life insurance sales through the original brand (SelectQuote). From a Medicare insurance standpoint, SelectQuote offers some big name insurance companies:
- Mutual of Omaha
- United Healthcare
- GPM Life
- Gerber Life
Since Medicare insurance plans are standardized by government regulation, you may be able to find a better rate with a different company, but this will vary greatly depending on the area that you live in.
As far as senior life insurance, SelectQuote gets a mixed review. If you are looking for term life insurance, SelectQuote works with great term life insurance companies for seniors. However, if you are looking for final expense insurance, your options will be limited.
While SelectQuote does have three power players in the final expense and burial insurance market with Globe Life, AIG, and the Mutual of Omaha, you may have a waiting period for your full death benefit when other life insurance companies will cover you fully on day one.
Who are SelectQuote’s closest competitors?
While SelectQuote may have pioneered life insurance, telesales they are no longer the only game in town. Competitors like AIG Direct and Policygenius all have simliar independent telesales models to SelectQuote.
However, there has recently been a new wave of modern life insurance companies attempting to disrupt the market. “Insuretech” startups like Haven Life, Ladder Life, and Ethos Life now online applications directly to consumers bypassing the phone process altogether.
However, we agree with SelectQuote’s decision to maintain the use of agents during the buying process. Applying online is great when it works, but the kinks are far from worked out. That is why we call our clients as well to set expectations and confirm we are with the best choice.
When anything goes wrong in the process, as things inevitably do, consumers can feel frustrated without someone familiar with the insurance industry to be their advocate. When you can only sell one company with strict underwriting guidelines, the problem gets exaggerated.
Being able to conduct a price comparison initially and place a consumer with the right company BEFORE they get declined is just common sense. It is less hassle for the client and results in more people getting insured.
Final Thoughts: Is SelectQuote worth it?
Thank you for reading our SelectQuote review. SelectQuote has been around over 34 years and is America’s leading sales agency for term life insurance, partly due to their gigantic advertising budget.
SelectQuote’s business model is strictly telesales. If you choose to do business with SelectQuote, you will be putting your trust in a call center to get your application right on the first try and hope they remain in the business.
If you want a no-exam life insurance policy or a life insurance policy that includes living benefits for critical illness and chronic illness, you might want to look around. If you are OK with taking a medical exam, then SelectQuote has some of the top life insurance names in the industry.
That said, we would suggest getting a second opinion, especially if you have a pre-existing medical condition. Field underwriting takes some time to learn. If your call center agent is inexperienced, that mistake may cost you in the long run.
If you want a second opinion, fill out a quote on our website or give one of our veteran agents a call. A quote comes with no obligation, and we will give you our honest opinion one way or the other.
FILED UNDER – INSURANCE COMPANY REVIEWS
Joe is a lifelong learner with a passion for sharing what he has learned with others. Joe has publicly spoken on life insurance in the past to both colleagues at industry conferences and to consumers in educational settings and as a contributor to industry blogs. Additionally, Joe is studying for certifications such as the CFP, CLU, and RICP to further his professional knowledge.