How to lower life insurance premiums

How to lower life insurance premiums

November 16, 2016
life insurance
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It seems that everything costs an arm and a leg today. No matter where you look, prices are always climbing. And this is the case with life insurance as well. Life insurance companies use a variety of factors, such as age, health or location, to calculate a policyholder’s premium cost. Unfortunately, they also look at some lifestyle factors, like smoking, obesity and even hobbies, when deciding how much of a risk you are. And these factors can paint you as a high risk.

But there’s a bright side to this as well. Knowing that insurance companies also look at the way you live your life can help you lower your premiums. Here’s what you need to do:

1. Stop smoking

If you want to pay less for life insurance, then you definitely need to do this. But you should know from the start that it’s not easy. Smoking is addictive and most smokers try and fail several times before successfully giving it up.

But giving up smoking comes with a lot of benefits. In addition to the better health, you lower your premiums by a lot. Depending on your age, you can save between tens and hundreds of dollars each year.

2. Lose weight

Obesity is one of the biggest reasons why people pay more for insurance. If you didn’t know it yet, it’s linked to numerous diseases, such as diabetes, heart disease, stroke and cardiovascular ailments, that can put you in an early grave. Insurance companies definitely don’t like this.

Insurers use the body mass index to see if an applicant’s body weight falls within a healthy range. Just make sure that your BMI is good and you’ll get that discount.

3. Be a safe driver

We already know that a poor driving record leads to higher auto insurance rates. But I bet you didn’t know it can also raise your life insurance rates as well. Reckless driving means that you’re putting your life in danger. It’s not unlike smoking or being overweight. So be a safe and responsible driver behind the wheel and you’ll keep both your auto insurance and life insurance premiums low.

4. Get it while you’re still young

The older you get, the higher the premiums. If an older person gets a policy, the insurance company will have fewer years to collect premiums before it has to pay a death benefit. Therefore, the premiums will be higher. But if a younger person gets life insurance, he or she will pay less.

5. Try term life insurance

There are two kinds of life insurance: term life insurance and whole life insurance. With the first type, a person is covered for a fixed term, usually 10 or 20 years. The second kind, on the other hand, covers you from the moment you get it until you die. Insurance companies charge much less for term life insurance, since most term life insurance policies never pay a death benefit.

The bottom line

Getting lower life insurance premiums is a great way to save money each month. If you follow these five tips, you’ll not only do that, but also live a better, healthier life.

Thomas Hookton is a finance journalist, history buff and science fiction connoisseur. Hit him up via email.

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