How To Buy Cheap Life Insurance

The Definitive Guide To Locating and Purchasing Affordable Life Insurance

What if I told you everything you thought you knew about buying cheap life insurance was wrong?  Would you believe me?

What if locating affordable live insurance was not as complicated as it seems?

What if you found out all of the advertisements you saw on TV for life insurance were misleading and just trying to sell you something you don’t need?

Wait…what?  The advertisements on television are just trying to sell me something?  How dare they!

So You Want Life Insurance That Is Cheap?

Of course you want affordable life insurance – we all do.

You may think the best place to begin searching for the elusive cheap life insurance policy would be to hop online and type variations of that phrase into Google – well, you’re wrong.

All of the commercials on television and ads you see online want you to believe that the only way to get the best deal on life insurance is through one of these life insurance quote companies that will compare the rates for you.

What they don’t tell you is that they work with a select group of insurance companies and will find you the best rate among the companies with whom they have deals – yeah, they’re making money off of you by limiting your insurance options.

The Secrets To Finding Affordable Life Insurance Are…

Go Shopping and Shop Local

The best and most efficient way to find a life insurance policy that you can afford is to simply whip out the yellow pages and call the companies branches that are in your hometown!  Be sure to call the insurance companies and financial planners – they all sell life insurance and guess what…THEY ALL WANT YOUR BUSINESS!

How do I know this?  I tried it.  I went online to a few of those insurance locating companies and all of the local insurance agents were able to beat the online quotes – why?  Because I talked to them in person and told them the price they had to beat.

There is room for negotiation when purchasing life insurance.  The first number they give you is based on an algorithm that calculates your risk against a set of factors.  It’s not set in stone and the agent can definitely make you a deal to get a sale.

Buy Your Life Insurance Now

You’re not getting any younger and insurance companies will base the cost of your premium partly on your age.  This means the younger you are when you open your policy, the less expensive it will be!

Also, if you are thinking about getting life insurance, you probably have a good reason for wanting the coverage.  Tomorrow is not guaranteed and if you have someone or multiple someones that rely on you, don’t let them down.

Stay Healthy and Avoid Unnecessary Risk

There are several proven ways to get a lower life insurance premium, but the main ways are to live a healthy lifestyle and do not take unnecessary risks.

Life insurance companies are not stupid.  They are statistical geniuses!

Higher premiums will get doled upon you because if your health or lifestyle, it may be time to re-think your priorities.  Higher premiums means that the life insurance thinks the way you’re living means you have a higher chance of death.  Who wants to die early?

Is the double bacon ranch burger and carrying around the extra 25 lbs really worth a few years of your life and extra cash sent to the life insurance company?

The life insurance companies have compiled all of the data and they know what kills people and when.  If they think you’re a risk, it’s time to change your ways.  Not only will you live longer, you’ll also save money on your premiums.

Don’t just buy your insurance from your buddy’s uncle

Sure having an insurance agent you trust is a good thing, but if your buddy’s uncle is the only place you hit-up for your policy, we’re going to have trouble.

You need to keep all of the companies honest by getting  a few different quotes.

If your buddy’s uncle can match the quotes you get online and from other agents, he’s won your business.  Otherwise he’ll need to get competitive.

Buy Term Life Insurance

Not only is term life insurance cheaper than whole life insurance, it’s WAY cheaper.  Premiums on term insurance policies are usually sold at a fraction of the cost of the cost of a whole life policy.

Few people actually need or can afford a whole life insurance policy – don’t be the sucker.

Unless you have special estate planning needs, you should never really have a reason to purchase whole life insurance.

You can also customize term insurance to your specific needs and have the exact amount of coverage you need at the times in life when you need it the most.  When that period in your life is over (and the policy has expired), you can just cancel the policy and stop making the payments.

So we decided that whole life insurance is a waste of money and term insurance is the way to go when looking for the cheapest policy possible.  Great - let's move on.

Drop Some Fat

Yeah, let’s be blunt here and shed some fat.  Many people pay higher insurance premiums because they’re fat (and I’m not going to say overweight – let’s call a space a spade).

Many illnesses that kill people such as diabetes and heart disease are often-times attributed to being fat.  And like we said, insurance companies like to avoid risk or make you pay for it.  Either way, carrying around those love handles will cost you money.

If you are overweight, this is an instance where, if you’re serious about lowering your premium, it could be beneficial to delay obtaining coverage if you’re planning on losing the weight.

Quit Smoking

Remember when we said life insurance companies don’t like to take risks?  Well, smoking is known to cause cancer.  Cancer can kill you.  You will pay higher premiums if you smoke and that’s a fact.

Smoking is so detrimental that most life insurance companies actually have a separate rate chart they use for smokers.

You can’t just stop smoking for a day though.  Most insurance companies will want you to be smoke-free for at least two years before they’d consider you a non-smoker.

Bundle Up

Just like you can get lower rates when you bundle homeowner’s insurance with your auto insurance policy, you can also get savings by bundling a life insurance policy into the mix.

This brings us back to calling your current insurance company.  They may have cheaper options when you bundle policies.

Bundling policies doesn't guarantee a lower rate, but should be part of the process when you're shopping around.

Term Life Insurance Recap

Now that you know how to get the best rate for term life insurance, let’s just do a little recap on what term life insurance is and who needs it.

Do I Really Need Life Insurance?

If you have other people that depend on the income you provide by working then you should have some form of life insurance.  If your family would be left in a hard place if your pay checks were to suddenly stop you need life insurance.

Why Is Life Insurance The Way To Go?

The instant you purchase your policy, your family will be protected.  There is no waiting period or anything like that.  If you die, your family will get the death benefit and be taken care of.

How Does Term Life Insurance Work?

When you purchase a term life insurance policy, you purchase it for a specific duration of time.  The time span could be 10 years or 30 years – whatever fits your needs at the time.

The premiums will typically remain the same throughout the duration of of the time period as does the death benefit.  Even if you become seriously ill, the policy can not be terminated and your premiums can not be raised.

Most people will purchase a term life insurance policy and choose a duration that will keep them covered as long as they continue to work.  Some will choose a time frame based on when they believe their children will no longer be living in the house and some may base it on debt repayment.

It is all based on your unique situation.

What Are Some of The Drawbacks of Term Life Insurance?

Some people look at term insurance as though you’re throwing your money away – flushing it down the toilet.  Since when the term expires on a term policy your coverage just disappears and you have nothing to show for it.

Term life insurance is like renting an apartment.  You build no equity and when your lease expires, you move out with no obligation.

We think this is a fair trade, but some people just can’t get past the idea.

Final Thoughts on Life Insurance

The most important thing is to determine how much coverage you actually need.  If you have to much coverage, you’ll be paying more in premiums than you need to be paying.

If you don’t have enough coverage, you could leave your family in a bind if something were to happen to you.

  • Immediate needs (funeral expenses, debt, mortgage)
  • Every day expenses (monthly bills)
  • Future Expenses (college, retirement)
You need to understand again, that term insurance is equivalent to renting your insurance.

So what is the one little trick that can save you $1000s when shopping for life insurance?

Since you read down this far, we’re going to show you one final little trick on saving money on your life insurance.

Now let’s say you have a child you want to send to college ($100,000), a mortgage to pay off, and some recurring debt.  With this scenario, let’s say you need a $500,000 policy.  Most agents would suggest you take out a 30-year term policy @ $500,000.

What you should actually do is apply a laddering strategy.  Rather than purchase a full $500,000 for 30 years, you could purchase smaller insurance policies for various time frames based on when you think you’d need the money.

Additional Resources

Life Insurance Laddering

Laddering life insurance policies means you buy several life insurance policies over a period of years or even decades.

http://www.bankrate.com/finance/insurance/life-insurance-ladder.aspx