How Can I Save Money When Buying Life Insurance?


When buying life insurance, one of the best ways to save money is to pay your premiums annually. Some insurers charge monthly fees for billing. These fees are called fractional premiums. In some cases, paying yearly can save you money. However, you may pay more in the long run. Here are some tips for maximizing your savings:

Renewal Guarantees


If you have a life insurance policy, make sure to ask about renewal guarantees. You will be denied the lump-sum benefit if you cannot renew your policy. This defeats the purpose of owning life insurance in the first place. If you have a guaranteed renewability provision, you can extend your policy if you change your health or occupation. Fortunately, there are many ways to ensure your policy renews without hassle.


Remember that renewal guarantees differ for every policy when buying a life insurance policy. Some policies are renewable only once and do not change their premiums over time. You should ask your agent about renewal guarantees to ensure you’ll never be stuck in a policy that is no longer appropriate for your needs. Non-cancellable policies are a good option because they lock in premiums and double the re-insurability guarantee.


The insured’s age determines the premium on a level-term policy at the time of the purchase. This age-based premium remains constant throughout the entire policy term. In the case of a renewable term life insurance policy, the premiums may increase or decrease according to the insured’s age. While most policies offer renewal guarantees, it is still best to check your contract—a renewal may require proof of insurability.


A guarantee that the policy will continue means that you can renew anytime. You should ask your agent about this if the renewal period is longer than ten years. Unless you cannot renew your life insurance policy for a specific reason, the renewal premium rate for a 10-year term policy can be as much as five or 20 times higher than the initial rate. Regardless of the renewal guarantee, shopping for the best deal is always a smart move.

Healthy Lifestyle


Keeping a healthy lifestyle is important for several reasons, including money. First, it keeps you physically fit and less likely to face medical emergencies. It also reduces stress. Second, maintaining good health can reduce insurance premiums. Third, a healthy lifestyle improves your overall well-being. While it may not seem like a way to save money, leading a healthy lifestyle can be beneficial for many reasons, including insurance savings.


It’s possible to obtain health insurance that rewards a healthy lifestyle. Companies are now implementing programs to incentivize a healthy lifestyle. For example, the Global Atlantic Wellness For Life plan rewards members who lose weight. This discount is applied from year three. Many plans also offer discounts if members maintain certain health goals.


Secondly, a healthy lifestyle can save money when buying life insurance. By reducing your health risk, insurers are willing to charge less for your insurance. If you have a smoking habit, you may be charged more than someone who does not smoke. Also, if you have high blood pressure, you may need to wait three years before applying for a preferred plus rating. Those with a healthy lifestyle can often turn these penalties into savings.


Lastly, a healthy lifestyle can help you save on your insurance premiums. Insurance companies will reward you for maintaining a healthy lifestyle with lower medical expenses. By maintaining a healthy lifestyle, you can also save money by selling your life insurance policy when you’re no longer eligible. So, start living a healthy lifestyle now and save money when buying life insurance—your family will thank you later.

Higher Face Amount


You can buy a life insurance policy with a higher face amount than the one you need. While a higher face amount means higher premium payments, it’s worth it in the long run. Life insurance providers will absorb any remaining cash value upon your death. But be aware that if you have a cash value component, you can borrow against it for a low-interest loan. However, the outstanding amount will be deducted from your face value if you pass away before paying back the loan.


Your face amount is the amount you declare when you apply for life insurance. You must understand that the face amount differs from the death benefit. The face amount is the amount you first declare on your application, while the death benefit is the money you receive when you die. The face amount is the initial amount you pay for your life insurance policy, while the death benefit is the actual money paid to your beneficiaries. You can increase the face amount of your policy by adding riders.


The face amount of a life insurance policy is the amount the insurer will pay out to your beneficiaries if you die. A $100,000 life insurance policy has a $100,000 face value. A higher face amount will cost you more in premiums, but it’s worth it for your loved ones to have that much money to help them with burial expenses. Regardless of how much you plan to leave behind, choosing a higher face amount can help protect their financial health in the long run.

Insurability of pre-existing conditions


A pre-existing condition may cause the insurance company to raise your premiums. A common example is if you have a heart condition. In the past, people with this condition were unlikely to be insurable in both the group and private market. Today, pre-existing condition clauses are generally invoked after a claim is filed or after a post-claims investigation.


Heart disease and severe mental-nervous disorders may cause a higher premium. While heart disease can prevent you from purchasing life insurance, it does put you at a higher risk of heart-related health complications. Other pre-existing conditions, such as arthritis, can affect your ability to pay premiums. However, you can still get coverage if your pre-existing condition is managed.

Term Life Insurance Rates


Term life insurance rates vary greatly, depending on the insurance company, the coverage amount and the applicant’s age. Some companies offer no medical exam options, while others require a physical. Your age and health will also affect the amount you pay, so it’s important to shop around to find the lowest rate.


If you’re a new parent, you might want to consider a 20-year term policy to protect your child’s financial future until he or she reaches retirement age. This policy will provide coverage until that child no longer relies on either parent financially. Many life insurance companies offer term life, and comparing quotes online is easy. Term life insurance rates vary according to many factors, including your health, age, and gender.


When shopping for term life insurance, remember that premiums will be lower in younger, healthier individuals than in older, health-challenged individuals. While term life insurance rates are lower for healthy people, they will not build a cash value over time. Premiums are based on your age and current health, so if you have significant health problems, term life insurance may not be the best option.


Term life insurance policies are less expensive than whole life insurance. However, most life insurance companies offer rate discounts on specific insurance amounts. A policy for $250,000 costs less than a policy for $500,000. At the other end of the spectrum, policies for $1 million or more can save thousands of dollars throughout the policy’s lifetime. Moreover, you can save money when buying term life insurance without a medical exam by purchasing a policy with a medical exam. This way, insurance underwriters want to know about your health and lifestyle, so they can reward you with lower rates.

About the Writer

Daniel Watts graduated from Wilfrid Laurier University with a Bachelor of Arts in English & Literature. He has written professionally for over seven years, helping numerous small and medium-sized businesses establish a strong online brand presence from the ground up.


With a proven track record curating keyword-optimized blogs, website content, social media, and pay-per-click advertisements, Daniel is also well-versed in Website Design, HTML & CSS, Search Engine Optimization and WordPress Development. 


Daniel currently works as a Project Manager of Content at a leading Toronto digital marketing agency. His responsibilities include carefully managing written content and helping to facilitate projects at optimal quality. He also helps write content for client websites, quality checks each website, and oversees the editing, approval and posting process for all keyword-optimized content.