Affordable Life Insurance For Almost Any Budget
It's your first time buying life insurance and you've done your homework — researching the different types of life insurance policies and shopping around to compare prices from different companies. (Your parents should be proud.)
But don't sign on the dotted line just yet.
With a little help, you might be able to save money on the coverage you need to help financially protect your loved ones.
Here are some money-saving tips for buying life insurance.
You wouldn't stay in a hotel or eat at a restaurant without comparison-shopping. The same should be true for buying life insurance. However, just as it wouldn't be fair to compare the cost of an all-inclusive resort to a hotel that only provides a room, it's important to always compare apples to apples when looking at life insurance policies from different companies.
For starters, make sure that both are classified as the same type of life insurance policy, such as permanent life insurance or term life insurance. A term life insurance policy from one company will likely be less expensive than a whole life policy from another — and the features of the policy will be completely different. So, if you're getting quotes from different companies, always compare like policies.
When you buy a life insurance policy, you do so with the expectation that the company will still be there when it's time for your loved ones to cash it in. Choosing a reputable company now can save your family time, money and hassle later.
How can you find a life insurance company worthy of your trust?
Take into account their rating from third-party agencies, such as A.M. Best. That can help give you an indication of the company's financial strength (or lack thereof).
You might also consider the life insurance company's longevity. How long has the company been in business? If it's been around for decades, it's a sign of durability. That means the company is more likely to still be around when you and your loved ones need it most.
You know that life insurance is important — as it can help your loved ones stay afloat financially, should you pass away.
So, if you know you need to buy it anyway, why not try to save a little money along the way?
Fortunately, there are a number of money-saving tips for buying life insurance.
Here are some of them:
To save money on certain types of life insurance policies, such as term life insurance, ask about more coverage, not less. Some companies offer life insurance price breaks, also called "milestone discounts," for higher coverage amounts.
For example, you might get a break for getting $250,000 in coverage instead of $200,000. So even if you figure out that you only need a certain amount of coverage to protect your loved ones, it may be worth asking how much a higher level of coverage would cost.
You could end up saving money on life insurance, while getting your loved ones greater protection.
To get approved for certain types of life insurance, such as term or permanent life insurance, you often have to first take a life insurance medical exam. The results from that exam, along with your answers to a health questionnaire, help the life insurance company assess your level of risk for passing away prematurely.
However, there are also certain policies that allow you to forgo the life insurance medical exam and questionnaire completely. There are a number of reasons why one might want to skip a medical exam, such as health issues.
But, if you're generally in good health, buying a life insurance policy that requires a medical exam will typically be less expensive than buying one that doesn't.
Term life insurance policies last for a specific duration of time, typically between 10 to 30 years.
However, some life insurance providers allow you to choose the amount of time that best serves your needs, in one-year increments.
For example, you might be 17 years away from paying off your mortgage. You can get a 17-year term life policy to match that mortgage commitment.
The longer your term duration, the more you'll likely be paying for it. By customizing your term length, you'll only pay for coverage during the years you need it most.
A life insurance rider is an addition or an amendment to a life insurance policy. Often times, it's a great way to get extra life insurance coverage for minimal additional cost.
There are number of different types of riders, such as accidental death benefits, child riders, terminal illness riders, or waiver of premium riders.
For example, you may be able to get accidental death benefits, which would pay out money in addition to the benefit amount of your life insurance policy. It's also advantageous because accidental death coverage is typically offered as a separate policy. By adding it as a rider to your life insurance policy, you'd only have to manage one policy instead of two.
With a life insurance renewal guarantee, you're guaranteed the chance to renew your term life insurance policy — without retaking the medical exam.
It's true that your life insurance premium will be based on your current age — not the age you were for your initial term, but you won't have to start the shopping process all over again.
This is particularly valuable if your health has declined. Trying to buy term life insurance from scratch with poor health could mean paying a higher premium — or not qualifying for coverage at all.
Some insurers allow you to pay monthly, quarterly, semi-annually or annually. Paying annually can often save you money. Also, there are often fees for monthly billing (these are called "fractional premiums"). It might pinch to make an annual payment, but it's worth asking about in order to save money in the long run.
Term life insurance is generally less expensive when you are younger and in relatively good health. That's not generally the time in life when most of us think about buying term life insurance, but actually, it's the best time to save money.
Waiting until later in life when you're older or might be dealing with medical issues can drive up your premiums — or it could even prevent you from qualifying for term life insurance at any price.
Are you a skydiver? Underwater welder? Pilot? If you have a high-risk hobby or occupation, be sure to shop different companies when buying life insurance. Each life insurance provider rates risks differently, so you might be able to find one that charges less for high-risk activities. Quality term life insurance may offer a good price for your lifestyle.
Some companies may offer term life insurance policies with "living benefits." All term life policies offer your loved ones some degree of financial protection, should you pass away. But term life policies with living benefits may be able to provide you or your family with financial help during your lifetime — when you need it most. Living benefits are typically available to those who have a chronic, critical or terminal illness.
It can help to offset the cost of medical bills or other expenses, allowing you and your loved one to focus on what matters most — enjoying every moment together.
Buying life insurance only takes a few minutes. Speak with one of our licensed agents at 800-294-4544 to get a free, personalized quote.