So I’ve been looking at life insurance for the last few weeks. Most people I’ve spoken with have said there’s a few ways you can cut costs on your life insurance bills. I’ve outlined a few below.
Don’t take my word for it though. You should speak with a financial advisor about such matters. Ensure they’re regulated by the central bank of Ireland. They’ll give you exact details.
Life insurance is the single most important piece of protection you can put in place to secure the future of your family. No one likes to think about their own mortality, but spending just an hour choosing the right policy is undoubtedly an hour well spent.
There are a whole raft of life insurance policies available, each offering a different level of cover to meet your particular circumstances and needs. The price you can expect to pay for a life insurance policy will be determined by the level of cover, your age, gender, medical history and lifestyle.
Any insurance policy is a delicate balance between risk and cost. The higher the level of risk you represent, the more you will have to pay. As such, there are certain factors that can really push up the level of risk, and the subsequent cost. However, by making just a few small changes, it is possible to reduce the price of life insurance considerably.
Here are 5 ways you can reduce the cost of your life insurance premium:
1. Give up smoking
It’ll probably come as no surprise to you that our number 1 tip is to give up smoking. That might be easier said than done, but if you’re a smoker you will always be classed as a high-risk customer, regardless of the insurance company you go for.
Smoking vastly increases the risk of contracting any number of life threatening diseases. By kicking the habit for a minimum of twelve consecutive months, not only will you enjoy a healthier lifestyle and save a fortune on the cost of cigarettes, but you’ll also reduce the cost of your policy.
2. Compare policies online
By now all know just how much comparing prices online can save us, even if it’s just from past experience with our car insurance. Well, exactly the same is true for life insurance policies. The cost of cover can vary wildly from one insurance provider to the next, so make sure you take the time to compare a number of like-for-like policies to see which offers you the best value.
3. Check your rating
By reviewing your rating with a particular insurer, you will be able to see whether you have been ‘loaded’ (charged an increased premium) for a medical reason such as your body mass index (BMI). If this is the case, approaching a different life insurance provider will allow you to get a second opinion, which can improve the underwriting decision and lower the cost of your premium.
4. Are you paying for ‘whole of life’ cover
‘Whole of life’ cover has been the policy of choice for the last decade or so. The main benefit of this policy is that it guarantees a payout as long as your premiums are paid, unlike term insurance, which will only pay out if you die within a predetermined period of time.
The downside of whole of life cover is that your premiums are reviewed every 5 years. So, as you get older and the risk increases, the amount you pay will rise. As you reach 55-60 years olds, the premiums can start to get very expensive, and you may find it’s more than you’re willing to pay. In this case, it could be worth reviewing the amount of cover you need to reduce the cost of your premium.
5. Choose your policy based on affordability
You should make your decision as to which is the right policy for you based on the level of cover offered by policies within an affordable price range. You do not want to be tied into a policy you will struggle to afford. However, be careful not to under insure. There’s no point paying into a policy that does not provide the protection your family will need.