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You Don Not Have to Pay Exorbitant Premiums for Life Insurance

Aug 11, 2008
Having a life insurance policy in place gives you peace of mind that you family will not have to bear the burden of paying for your funeral expenses and may have some money left over for themselves. Such policies are designed so that the beneficiary you name on the policy will receive a lump sum payment to the value of the policy when you die within the term of the policy. In some cases there may be conditions placed on the reason for your death, especially if you have a health condition at the time that you take out the policy. In this case, the policy will only pay out the lump sum if you die under other conditions.

There are ways of saving money on your life insurance because of the many different types of policies that are available. There is also a wide choice in the types of cover you can have depending on your needs and individual circumstances. The main factors that affect the cost of life insurance are your lifestyle, your age, your medical history, your job and your gender. Some factors affect the cost of the policy more than others.

Smoking is one of the lifestyle factors that does drive up the cost of life insurance. This is because so many health conditions, such as caner and heart disease, are linked to smoking. You have a greater chance of contracting a life-threatening medical condition. Even if you are a reformed smoker, the agent you deal with for the policy will want to know how long ago you gave up smoking. In order to save money, this time frame has to be longer than a year.

You will pay a lower premium if you take out a life insurance policy when you are in your 20s or 30s than you will if you are in your 50s or 60s. This is because of your life expectancy. You have a greater chance of dying when you are older and so the likelihood of having to pay out the policy to your beneficiary is much higher. The older you are, the more costly a life insurance policy becomes.

If you work in a high-risk industry, such as mining, you will also have to pay a higher premium for your life insurance. This is because there is a greater chance that you will get killed on the job. Your age also plays a part in the cost here because if you are young you may be deemed a high risk because the young are not known to be as cautious as older workers in the same line of work.

When you take out a life insurance policy, you do have to fill out an extensive health questionnaire. You may also be required to have a fill physical check up by the doctor in order for the company to be satisfied that you do not have any pre-existing medical conditions. It is important for you to be truthful when completing this questionnaire, especially if the company does not require any information from your doctor. If you give false information and the company finds out that you do have a pre-existing medical condition, then your policy will be cancelled and you will be left without any life insurance.

Improving your diet and exercise is a way of staying healthy. The questionnaire you complete will also ask you questions, such as your exercise habits and your eight and height. If you are overweight, this could affect the cost of your premiums because being overweight is linked to life-threatening disease, such as heart disease. Even if you are overweight when you take out the policy and you change your lifestyle through diet and exercise, you can make changes to your information that will lower your costs.

Shop around when you are looking for life insurance policies. Make sure the company your deal with is financially sound and is not in danger of going bankrupt, taking all your premiums with it. Get a sense of the amount of premiums you are likely to pay by shopping online and requesting free quotes on various types of policies. The life insurance industry is a competitive one, with companies offering various rates and discounts. Make sure you ask about any discounts that you may qualify for because these will lower your costs.

One thing you should be aware of when paying premiums for life insurance is that some companies levy extra charges against you if you choose to pay your premiums on a monthly basis. Compare the rates involved with monthly, quarterly, semi-annual and annual payments to see where you can save the most money. When you are looking for a term policy, check the renewal guarantees after that term is over. You do not want to have to start shopping around for a new policy when it is easier just to continue with the one you have for another term. A policy with a guaranteed renewal will allow you to start a new term when the current one ends without having to undergo another doctors examination. The premiums will be higher because of your increased age.
About the Author
Peter Kenny has been writing financial articles for 10 years and is a writer for The Thrifty Scot, please visit us at Life Insurance and Balance Transfer Credit Cards
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