Do you think you are paying too much for your life insurance? Well, you definitely are not the only one out there. The good thing is that you can still hold onto your current policy without increasing your budget.
According to a research, the average monthly premium for life insurance is around $47. This amount depends on a number of factors such as the insurance type, coverage amount, health and age. If you make use of the guidelines below, you can reduce your life insurance premiums.
Compare quotes from different providers
Every insurance company has developed their own methodologies for assessing risk on a life insurance, which cause variations in the offered premium amounts. Thus, if you consider quotes from the top insurance brands and other boutique brands such as Freedom Insurance you are more likely to get a better deal.
Select appropriate coverage
Exactly how much coverage do you need? If you can calculate this accurately, you can keep your premiums to a minimum. Figure out if you want your insurance to cover your remaining mortgage, serve as a replacement of your lost income, pay for your funeral costs and other possible levels. Accordingly, sign up for an appropriate plan.
Decrease the term
The premium amount you pay depends on your insurance term; the greater the term, the more you have to pay. You could for instance only avail insurance for as long as you have to pay the mortgage or till your kids are young or unemployed.
Consider a single policy instead of a joint one
Do you want life insurance for both you and your spouse? Sometimes a joint policy may not be the best bet. Usually such a policy pays the coverage amount, when even one of you dies, implying that the insurance amount for both of you is the same. Is this right in your particular scenario? Not always. If your partner earns less than you do, then their insurance should also be lower than yours. Also when you go for separate policies, the coverage amount is paid out two times if you both die within the insurance term.
Work on your health
Before you can get life insurance policy, you have to fill up a health survey. If you are obese or smoke, your premiums will probably be more. But if you lose some pounds or quit smoking, you can get premiums. Just keep in mind that this won’t be instantly, and you will have to wait for a year or so before your insurance provider revises your premiums.
Look out for hidden fees
Some insurance providers have some hidden fees, which you should find out before selecting any one of them. As an example, you may have to pay more if you pay your premium monthly rather than yearly. Check out if your plan has any add-ons, which offer more coverage than what you actually need. Term conversion rider, disability income rider, and accidental death benefit are some common add-ons.
Consider Complementary Investments
It is also good to consider other options that are complementary to insurance policies that are likely to provide ongoing financial security. Investments in assets such as property, gold bullion, blue chip shares etc are options if you have spare disposable cash. Ultimately diversifying around your insurance policy as a base is going to give you the greatest security possible.