To have a sound financial plan for the future, taking out a life insurance policy is a great way to do so. Often times it isn’t something that is bought but is sold to. Getting a plan may seem too expensive at the moment, but there are steps that you can take to save money while you buy life insurance. These options don’t always include getting a lower premium outright. The cost shouldn’t be your first priority when looking for life insurance. You need to find a plan that meets all your needs. Getting a plan with the wrong benefits but a lower premium is pointless and saves you nothing. Here are a few things to keep in mind so that you know how to save money on life insurance.
Before Buying Your Policy
When you know what kind of insurance plan you want to buy, your next step is focusing on companies that are financially sound.
So many companies sell life insurance, knowing which one is the best for you can be difficult. Limit the companies you’re interested in to those that have more than a couple high ratings from rating agencies that are independent.
Get a good concept of how much the premium is that you’re willing to pay by shopping around. There are many services and applications on the internet that can provide you with quotes. If you prefer, you can also ask a broker or an agent for an estimate.
During your research, look into which of the price classes you could possibly fit in. Most insurance companies sell life insurance at different prices and different classes. They usually have something along the lines of “standard (non-tobacco),” “preferred (non-tobacco),” “standard (tobacco),” and “preferred (tobacco).” While the percentage is small, there are a few people who might have a history of health issues or have a current health condition that disqualifies them from all classes. Many of these people will have insurance that is “nonstandard” or “impaired risk” offered to them.
Group insurance is another option that is a possible choice. Group insurance is usually insurance that is offered through your employer. It’s often less expensive than life insurance that you get individually, and you can get coverage at a higher level without proof of being in good health. Your premiums are paid through payroll deductions.
Ready to Buy (Look For Discounts)
Always be on the lookout for discounts on premiums for certain insurance amounts. A lot of companies have rate discounts for set insurance amounts. This could be beneficial if you want a higher life insurance policy. You could end up paying a smaller premium for a $500,000 policy than a $450,000 policy.
“Fractional premiums” are something you have to watch out for. You usually have the option to pay your premium once a year, half-year, quarter, or month. While paying every month may seem like the more manageable option, there are companies that implement high charges on those who pay their premiums frequently. There are also companies that only have small charges to pay more often. Do your research, and if you find that the company has charges that are high for paying more frequently, try to budget so you only have to pay a couple times a year.
When you’re shopping around, make sure that the insurance that you choose has renewal guarantees. Without any renewal guarantee, you could be having to do this process all over again when your current insurance ends.
For those who are looking to learn more about how to save money on life insurance, contact an insurance agent for more information. Tatum Insurance is a good place to start. They get know each of their clients so that can find insurance that fits their individual needs. To find out more, contact us today!