How can I reduce my life insurance premium? |
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Answer:
Your age, health history (including family history), and lifestyle are the primary factors, but there are others as well.
The amount of coverage you purchase (face amount or death benefit), the inclusion of riders, and the length of time your coverage is in place are all factors as well. The challenge is that there are some things about yourself that you simply cannot change. For example if you're paying more for your life insurance because you have a parent or sibling that died of heart disease or cancer prior to the age of 60-- you cannot turn back the clock. Although some of us would like to-- we can't push the rewind button on our age either. So while we can't change our age or our genetics, there are some practical things to consider when trying to accomplish a reduction in life insurance rates. Here are a few: * Change companies: Literally thousands of consumers are on-line each day searching for more affordable life insurance. You'll find that there are a wealth of resources available that allow you to instantly compare rates and plans from the top insurers in the country. * Reduce your face amount: Do you really need all that coverage? Take inventory of your needs and factor in savings and assets. You may find that you were a bit oversold when your needs were assessed originally. * Reduce your term length: If you purchased term life insurance and have taken good care of your finances-- will you need all of that life insurance beyond age 65? The shorter the term, the less expensive your coverage becomes. * Replace your permanent plan (whole life insurance or Universal Life Insurance) with a term life insurance plan. This is a common way that most accomplish a rate reduction-- but it's tricky territory. Make sure that, if your permanent plan has been building cash value, that you're not shooting yourself in the foot. It may not be in your best interest to get rid of a permanent plan that you've been paying on for years. Beware of an agent that advises you to do this without knowing everything about your existing coverage. * Lose the riders: Do you really need a $5,000 child rider or that waiver of premium rider? An assessment of your current situation may cause you to realize you don't need these additions and they're simply adding expense. * Lose weight: Were you a bit on the chunky side when you bought your plan originally? You may qualify at a better rate if you've been taking care of yourself. Usually with weight loss comes better cholesterol and blood pressure readings as well. If your health has improved-- you could benefit from a better underwriting health classification at the insurance company and therefore a better rate. * Quit using nicotine products: Once you've been off tobacco for 12 months-- your rates improve dramatically. The longer you manage to kick the habit-- the better your rates become.
While these are your main avenues to explore... you need to beware. Never cancel anything you already have in place based on a quote and the fact that you've applied elsewhere. Your rates and policy are not secure until a new plan officially goes in force. Just because you've qualified for life insurance before, doesn't mean you'll sail through the underwriting process again snag-free. The clock is always ticking-- you're getting older and increasingly susceptible to the health challenges associated with advancing age. So before you embark on the road to a rate reduction-- prepare. Figure out exactly how much coverage you'll need and for how long. Go to the doctor and get a complete physical. Take note of your height/weight, cholesterol (HDL, LDL and HDL to total cholesterol ratio), blood pressure, liver enzymes, and blood sugar. Talk to a broker that represents several companies and ask them the guidelines for the best possible rate. Compare the results of your exam to the guidelines and see how you'll fare. Thousands of Americans are finding ways to reduce their life insurance rates every day. You can too... but it pays to be prepared. Do your research on-line and by talking to reputable brokers and you may find yourself a tidy savings on your life insurance plan without ever leaving your house.
For more information on how life insurance rates are calculated, you can refer to How are life insurance rates calculated? Trackback(0)
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