Ways to Reduce your Life Insurance Premium
Life insurance premiums can be expensive. In a time when money is tight and your financial future is uncertain, you look for ways to save money. Rather than dropping your life insurance altogether, however, you may be able to do some things to reduce your life insurance premiums.
Here are a few things you can try to get those life insurance premiums down to a manageable level:
Get term, not whole life. If you have a whole life insurance policy, cash it in and buy term life insurance. Term life insurance doesn’t build cash value the way whole life does, but it’s also a lot cheaper. You can get several times the face value for the same premium price when you switch to term.
- Reduce your term length. The length of your term life insurance policy determines, in part, your premiums. Consider getting a shorter term policy, as that can reduce your premiums.
- Lower your face value. One of the easiest ways to drop your rates is to lower your coverage. Figure out the minimum insurance you need to have and go down to that amount.
- Consider lifestyle changes. The three biggest factors that go into determining your life insurance premium amount are your age, your weight and whether or not you smoke. While you may not be able to turn back the calendar, at the very least you can shed a few pounds and quit smoking. Your life insurance premiums will drop slightly after one year of not smoking, even more after two years, and then become nearly the same as a non-smoker after five years of not smoking.
- Get rid of extras. You might have a waiver of premium rider on your life insurance policy, or you may have a rider for your child. Get rid of everything but your basic coverage and you’ll be getting rid of extra premium costs.
- Ask for a discount. Some life insurance companies may offer other discounts. For example, you may be able to get a multiple policy discount if you have your auto insurance through the same company.
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