Cheap Life Insurance: 5 Tips to Save Money on Cover

Having life insurance cover in place can make all the difference for your family if something should happen to you. There are lots of reasons why you should buy life insurance, but one of the main reasons is to protect your family financially. 

If you’ve already been searching for life insurance, or have cover in place, you may realise that life insurance isn’t cheap. However, most people aren’t aware of how to get cheap life insurance. In this article, we’ll take a look at the 5 ways in which you can cut the cost of your life insurance premiums.

How much does life insurance cost?

When you take out a life insurance policy, you are required to pay a monthly premium to your insurer. You need to continue making payments until the end of the policy term, otherwise, your insurer can end your cover early.

The cost of your premiums depends on several factors, such as:

• Age
• Health
• Occupation
• Policy type
• Policy length
• Smoker status

Most insurers will ask you to fill out a questionnaire to determine the factors above. They may also ask you to undertake a medical exam to fully assess your health. As you get older, the cost of life insurance increases – this is because you are more likely to develop medical conditions once you reach a certain age.

Not only is smoking bad for your health, but it also increases the costs of your premiums. This is due to the long-lasting health effects smoking can have on the body. You may be able to reduce your premiums if you stay smoke-free for at least 12 months. The type of policy you choose will also have an impact on your premiums, as well as the length.

Compare Quotes from multiple providers

 When shopping for life insurance, it’s always best to get quotes from more than one provider. This way, you can weigh up how much a policy from each provider will cost you. With so many different companies out there, you have plenty of options. Also, the endless supply of online comparison sites makes comparing quotes easier than ever.

Understand the policies available

 There are two main types of life insurance policies – whole and term. Two of the major differences between these types are the cover length and costs. Here is a rundown of how they work…

• Whole life insurance – provides permanent cover, paying out a cash lump sum, no matter when you die. Furthermore, both the payout value of the policy and your premium costs remain fixed during the policy. Although it covers you for the long term, premiums are typically expensive as a result.
• Term life insurance – covers you for a set period of time which is agreed upon with your insurer (for example 20 years). Term life policies pay out a cash lump sum, providing you die within the specified term. If not, the policy expires and you will no longer be covered. As cover is only temporary, premiums for term life cover are generally cheaper than whole life.

Know What You Need

If you’re looking for life insurance, make sure you know what you need before buying. For instance, if you want permanent cover, then you should consider whole life insurance. On the other hand, if you just want short-term cover, then you should opt for term life insurance.

Also, remember that the amount of cover you require will depend on your circumstances. If your family depends on you financially, you’ll likely need more cover. However, if your family has plenty of savings or is financially stable even after your death, they’ll need less cover.

You should consider any financial obligations facing your family in the event of your death. The payout from your policy can support your family with financial commitments, such as:

• Household bills
• Funeral costs
• Mortgage repayments
• Other debts
• Childcare support
• Medical expenses

Essentially, you should consider how your death would impact your family financially. That way, you can ensure that you choose the right amount of cover for your family going into the future.

Buy cover when you are young

As you get older, the risk of developing medical conditions increases, along with the risk of death. Therefore, life insurance companies increase their premiums the older you get.

If you want to get the cheapest life insurance premiums, it’s best to apply for cover at the earliest stage. Policies such as whole life insurance and term life insurance offer fixed premiums, meaning you can lock in a cheap premium rate.

Consider joint life insurance

Joint life insurance is ideal if you have a partner who also needs life insurance. It is beneficial if both you and your partner share an income or financial responsibility for your household. 

The main benefit of owning a joint policy is that premiums can be cheaper than you and your partner taking out separate policies. It also ensures you are both covered if something were to happen to one of you.

The policy works in two ways:

First death – which the policy pays out after the first death in the couple

Second death – which the policy pays out once both you and your partner have passed away

If you haven’t already done so, now would be a great time to shop around for life insurance. So take advantage of the savings today and enjoy peace of mind tomorrow!