So what can I do to get cheaper life insurance?
Everyone loves getting a good deal, so here are some areas you might want to consider before you start comparing the market for life insurance:
• Get the right amount of cover – Goldilocks had the right idea and you shouldn’t settle for anything less than ‘just right’ and that means accurately working out how much insurance you need. So think about what your life insurance pay-out needs to cover, is it just the mortgage or is it to also replace your lost income or is it to pay off outstanding debts? Underestimating how much your dependents will need will leave them short but overestimate the amount and your premiums could increase.
• Be choosey about policy type – there are two main types of policy, term life insurance tends to be cheaper because they’ll only cover you for an agreed period of time like 10 or 25 years. If you pop your clogs after the policy term ends, you won’t get anything. But moving to the afterlife whilst the policy’s active will give your dependents a lump sum payment.
Whole of life policies cover you up until the very end – whenever that may be, so your dependents will always receive a pay-out (so long as you’ve paid your premiums), but these types of policies are more expensive.
• Invest when youth is on your side – the older you get, the more expensive premiums become so strike before too many wrinkles set in. At the younger stage of your life, insurance providers tend to think of you as less risky as you’re more likely to be healthy and less likely to claim, so insurance premiums are lower.
• Be healthy – sounds basic but to live long and prosper, you need a lifestyle that’ll encourage that. So it’s about being the right weight and making sensible lifestyle choices (like cutting back on the cigs and booze) and maybe even join a gym (you’ll be amazed at how much lycra can hold in nowadays). Even if you’ve got an existing policy, if you’ve changed your ways and can sustain the good habits, see if your insurance provider will reduce your premium to match your new slim-line silhouette.