Term Life Insurance Q&A
- Why should I choose BeyondQuotes?
- Which companies do we represent?
- Is BeyondQuotes licensed where I live?
- Is my information confidential?
- Do you only offer rate quotes?
- How do we choose which companies to represent?
- How much Term Life Insurance do I need?
- What are "level" policies?
- What should be the term length?
- Is it worth insuring my spouse on my policy?
- Can you explain the difference between Term and Whole Life plans?
- I suffer form a pre-existing condition. Can I still be insured?
Applying for a Policy
- How do I apply for Term Life Insurance?
- How do I find the best value plan for my needs?
- What is the waiting period between applying and coverage?
Pay Less for Life Insurance
Lower Your Life Insurance Premiums
Life insurance is one of those things that once purchased is forgotten about.
It's one of those things that once you have, you don't think about it too much which is one of the main reasons that most people are paying more than they really need to and are probably not getting the best deal.
Reapplying for life insurance once your health improves
For example, suppose that when you purchased life insurance you were only able to qualify for a non-preferred rate because it was determined that your level of cholesterol was higher than the life insurance company's suggested threshold.
A few months went by and you discovered upon the next test that your cholesterol level was within the company's preferred rate. You should know that it is possible to reapply for life insurance to qualify for a better rate even if most people never do.
And what goes for cholesterol goes for many different health conditions including blood pressure, smoking, alcohol consumption and liver enzymes.
If you have addressed the area of concern, and can prove to the insurance provider that you have been consistent over time (usually six months to a year), there is a very good chance that you can lower your premiums.
Additionally, another great way to lower your premiums is by shopping around. There are literally hundreds of life insurance companies in the U.S. and each one has different rating guidelines and pricing schemes.
Most people buy their life insurance from their auto insurance agent (or they buy their auto insurance from their life insurance agent, whatever way you want to look at it!) and don't shop the market.
There's nothing wrong with buying life insurance from an auto insurance agent, and some of the bundled discounts they offer can be quite attractive (as when you save 10% on homeowners insurance when buying an auto or life policy).
But sometimes you can still save significantly by shopping around and weighing your options.
The important thing to know is that just because you have a policy with a certain company, there is no reason why you shouldn't be able to switch to another company with a better rate if you are still in good health.
Do the math to lower your premium
Lowering your life insurance premium can, however, take a bit of math since the price of life insurance is mainly related to one's age.
Suppose that you are paying $35 a month for a policy with a face amount of $250,000. The term length is 20 years, and at the time of purchase you were 30 years of age.
You have had the policy for 15 years when, at the age of 45 you decide to shop the market for life insurance again. It would be somewhat unreasonable to imagine that you can lower your premium in this circumstance since you are now 15 years older.
Nevertheless, there is only 5 years left on your current policy before it expires which means that the value of your policy is less than what it would be if there were 20 years left.
If, at the attained age of 45 you could extend your term to another 20 years and only pay, say, $10 more a month, you would be getting a much better deal than what you are paying for your current policy even though it might be a lower dollar amount.
Other ways to lower your premium--Beware of Riders
You may want to think twice about getting policy riders. These ad-ons can add up and while they might seem attractive in most cases you probably won't need them.
The odds of a rider paying out are usually quite slim, and the prices charged for them usually make them a bad deal.
So if you have riders on your policy, you can look at canceling them, and if you are thinking about purchasing life insurance you can avoid them.
Lastly, while a permanent life insurance has its place in certain circumstances, it will be far more expensive than a term policy.
There is no question among financial experts that virtually everyone should have some form of term life insurance and that it represents a good value.
At the same time, many experts are divided on permanent insurance especially as a product needed by the average family, so be careful about any agent trying to talk you in to a permanent policy.
The steps to lowering your life insurance premium are as follows:
- Try to improve your health to qualify for the best rate
- Shop around--software makes it very easy to look at 20 different policies at once
- If you already have had a policy in force for some time, it may not be possible to find a lower dollar amount, but if you can extend your term, you may be able to get a much better value.
- For the lowers premiums, think in terms of term life insurance!
With a little bit of diligence, you will find that it is not too difficult to lower your life insurance premium!