Six tips to help you save money on life insurance
Need to buy life insurance? Here are six tips to help you make the right decision – and save money.
The older you get, the more financial products you need to buy to enable or protect the life you want to live – from mortgages and loans, to car, home and travel insurance.
But buying life insurance isn’t as simple as walking into a bank or financial institution and walking out with coverage. You need to do some research into the market, and evaluate your options before making a purchase.
To help you make the right decision, here are six tips to help you save money on life insurance.
1) Take your time
With so many options to weigh up, you don’t want to rush in when buying life insurance. Some policies may, on the surface, seem a good deal, but have hundreds of hidden clauses that make them much less of a good buy when you look into them. For example, you should know if the policy has a cash surrender value, and if so, how much cash would be available to you in the event you exercise that option.
So make sure you take your time, research carefully, ask questions and check the small print before making a final decision.
2) Check out your current providers
You’ll already have other financial providers, such as your bank, who supply you with products and services. So make sure you ask them what life insurance products they offer, and whether they give better rates and options to existing customers.
But just because the policy comes from a familiar brand, doesn’t mean that it doesn’t warrant the same level of scrutiny as any other policy. You still need to investigate whether it’s genuinely the right policy for you before buying.
3) Ask a broker
If you’re really unsure about how to find the right policy, ask an insurance broker for help. They should have access to the best rates on the market, and can get quotes from several different vendors.
A broker will also be able to advise you on which policy is the best fit for you, and warn you of any clauses that may make an otherwise attractive option less of a good buy.
4) Buy as soon as possible
The younger you are when you buy life insurance, the cheaper it is. So don’t spend years debating whether you need it or not.
There are two reasons why life insurance is cheaper when you’re younger: you have time and (usually) better health on your side, and there’s more time for your policy to mature.
5) Consider term vs permanent
Permanent, or whole life insurance has a number of benefits, but it’s also much more expensive. So, while the long-term benefit is greater, if you’re on a budget you may not decide to go with this option. And instead choose term life insurance.
Term life insurance rates and premiums are much cheaper than whole life, and you can select a specific term for which you want your policy to mature. On completion of that term, you can either cash out your policy or continue to pay a premium.
6) Take care of your health
There are many good reasons to take care of your health – not least to enjoy good health and longevity! But it also helps protect your life insurance coverage, as it allows your policy to mature without interruptions.
It also means that, if you need to apply for any new policies later in life, you’ll be in a lower risk class, which will save you money.
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