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Saturday, December 17, 2011

How to Save Money on Life Insurance


Selecting a life insurance policy is a very important decision. Therefore, adequate research should be done before making the ultimate purchase.  Below are some of the tips that one can use to save money on life insurance.

1. Do it Young!: The earlier you purchase your life insurance policy, the more you will save. Purchasing the policy at a young age ensures that you benefit from getting a lot of insurance while you are still young, vibrant and strong. As age catches up, many people become susceptible to various ailments - this statistic makes it complicated to qualify for life insurance.  Older applicants end up paying higher premiums since they fall under a higher risk category.

2. Try Term-Life: You should definitely consider selecting term-life insurance. This insurance policy is purchased for a specific duration of time, such as twenty to thirty years. This kind of insurance usually provides benefits to your beneficiaries if you were to pass away during that time period. However, if the policy holder dies after the term of the policy has expired; the beneficiaries will not gain anything. This kind of policy offers a lower premium for a similar cash value as that of the whole life though it does not earn interest.

3. Or Try Whole-Life: The Whole-Life policy is inclusive of a fixed amount of premium over the policy holder’s entire lifetime.  The investment is normally tax-deferred and earns a certain amount of interest with time, which is more than the principal. One can also borrow a loan from his or her earnings in certain situations. If the policy holder dies, the beneficiaries will get a tax-free death benefit.

4. Remember the Details: Compare the interest that you may earn from the policy against annuities and other types of investment.  It is wise to separate your investments from your life insurance policy.

5. Research the Insurance Firm: Prior to selecting a policy, you should take time to analyze the stability and strength of the insurance company. You can visit the National Insurance Commissioners website to find out how the company is rated. Details of how the company has been performing can also be found on this website. Also, read and analyze customer reviews. Online forums are great for this, and they are also a great place to seek advice on the best life insurance policy to take.

Notably, everyone would like to benefit from making some savings on his or her life insurance policy. With the above mentioned tips in mind, you should be able to get a good deal and save on your life insurance cover.  However, there are those who may not have the time and patience to research and get more information in a bid to save. Such people should seek the services of financial experts for advice on how to save on their life insurance policy.

Jalisa Rodgette enjoys cooking, giving personal finance advice, and writes for termlifeinsurance.org.

1 comment:

  1. Life insurance is a very important purchase, especially in the current economy when so many couples are getting divorced. It is impossible for spouses to depend on anyone other than themselves for this essential need.

    ReplyDelete

 

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