Most consumers don’t think a whole lot about life insurance, until they start their family, buy a house, or someone close to them passes away unexpectedly. When you have that family, you want to make sure they are secure financially if you were to pass away. Trying to do this without diverting money away from other goals, such as retirement or colleges savings, can be a daunting task.
In this article, we will give you tips to help you find the cheapest life insurance for those first time buyers as well as those looking for a better rate.
Top 9 Ways to Getting Cheap Life Insurance
- Always look at term life insurance first
- Make sure to get quotes from multiple providers
- Avoid add-on’s, such as riders or additional insurance
- Find an independent agent
- Stop Procrastinating
- Don’t fall for the “bundling” sales pitch
- Only buy from financially stable life insurance companies
- Quit smoking, dipping, chewing, & vaping
- No more high risk hobbies
Always Look at Term Life Insurance First
Term life insurance is always going to be the least expensive life insurance policy. You can purchase term life insurance for as little as 10 years (which will be the least expensive) and up to 30 years, depending on your age. These types of life insurance policies are easy to understand and the most popular because of the low premiums. With term life, you can afford enough insurance to cover your financial obligations, while having money left over to invest in your retirement. Hence the saying, “buy term & invest the rest.”
Get Quotes from Multiple Life Insurance Companies
Just like with any other purchase, you don’t want to jump on the first offer you receive. Make sure to get multiple quotes from different life insurance companies. Many life insurance companies have different niches that they have favorable underwriting for, so getting multiple quotes ensures you will find the lowest premium available that suits your situation.
Avoid Add-On’s, Such as Riders or Additional Insurance
If you are looking for the cheapest premium possible for your life insurance policy, then adding riders isn’t recommended. Don’t get me wrong, adding riders to your policy is not a bad option, it’s just going to raise your premium by doing so.
Some life insurance companies offer some riders at no extra cost so it’s important to inquire about this when looking to buy life insurance. Some of the riders offered at an extra cost are:
- Living Benefits Rider (Some companies offer this for free)
- Disability Income Rider
- Child Rider
- Spousal Term Rider
- Accidental Death Benefit Rider
- Return of Premium Rider
- Terminal Illness Rider (This usually comes free on all life insurance policies)
Find an Independent Agent
Buying you life insurance policy from someone who can only sale with one company, like State Farm or Nationwide, won’t give you the best odds of finding the cheapest life insurance. Working with an experienced independent agent will.
An independent agent, who is contracted with many carriers, will have multiple options for you to choose from. Life insurance is not a one size fits all product and not having access to multiple carriers could be costly.
If you don’t own life insurance already, what are you waiting for? Your life insurance premium will never be any cheaper than today. The longer you wait to purchase life insurance the more costly it will be.
Also, your health is more than likely going to change as you get older, and most of the time not in a good way. If you wait until you’re in “not so good” health, then you will definitely be paying a higher premium.
In other words, if you are young and healthy or even old and healthy, don’t wait! The longer you put this off, the more premium you will pay along with taking a chance of not qualifying if you have had health issues.
Life Insurance Cannot Be “Bundled”
I can’t count how many times I have had clients tell me that their life insurance is “bundled” with their car and/or homeowners insurance. This is just simply not true. Life insurance premiums are based on actuary and mortality rate tables designed for the carrier.
It takes into consideration your age, how much life insurance you are requesting, average life expectancy, and your health status. This is why you see different premiums for the same life insurance coverage from different carriers; actuary and mortality rate tables are not the same.
NOTE: You can bundle car and homeowners together to get a discount on your premiums just not life.
Many full service life insurance agencies will try to lure you in with this sales pitch, but in reality it just can’t be done. If you are looking for cheap life insurance you will want to avoid this.
Buy from Financially Stable Insurance Companies
You always want to make sure that the life insurance company has strong financial ratings from companies like:
- A.M. Best
Having strong financial ratings will ensure that the company is there to pay any claims later on down the road. Hopefully you won’t need to file a life insurance claim for 20 or 30 years and you want to make sure the carrier is still around.
Stop Smoking, Dipping, Chewing, & Vaping
If you are a smoker or use any type of tobacco product, expect to pay a 30%-50% increase in premium than a non-smoker would pay. Using various tobacco products has been proven to cause many illness’ and disease, which the life insurance companies take seriously when determining your premium. So if you want to find cheap life insurance its best to QUIT all tobacco products.
Stop the High Risk Hobbies
If you enjoy participating in high risk hobbies, such as hang gliding, mountain climbing, bungee jumping, or race car driving to name a few, expect to pay a higher premium. These hobbies along with a few more are considered riskier than average interests and in some cases will make you not insurable. You can expect your premiums to be higher at least until you are done participating in the risky activities.
So there you have it, nine tips on how to find the cheapest life insurance available. If you follow the tips above and work with an experienced independent agent you should have no problems when buying life insurance. If you have any questions or need a quote please give us a call or leave a comment.
Frequently Asked Questions
What are things I can do to get cheap life insurance?
Here is a list of things you can do to ensure you get the cheapest life insurance available?
-Always look at term life insurance first
-Make sure to get quotes from multiple providers
-Avoid add-on’s, such as riders or additional insurance
–Find an independent agent
-Don’t fall for the “bundling” sales pitch
-Only buy from financially stable life insurance companies
–Quit smoking, dipping, chewing, & vaping
-No more high risk hobbies
What is the cheapest life insurance available?
The cheapest life insurance available is term life insurance. Term life only lasts for a certain number of years and doesn’t build up any cash value.
What type of life insurance is the most expensive?
The most expensive life insurance is going to be whole life insurance. Compared to term life, whole life usually costs up to 4 times as much.
Does smoking make my life insurance rate increase?
Yes, smoking will cost more than non smokers who purchase the same type of life insurance.