How Can I Save Money on Life Insurance?
Tips on how to save money on life insurance and find yourself a better life insurance rate.
There are ways to save money when buying life insurance. As your top priority, look for a policy that meets your needs. Beyond that, here are some ways to maximize your life insurance dollars:
As part of your research, determine which rate class you will fit into. Most companies that sell individual life insurance have several different price classes, usually called "preferred (non-tobacco)," "standard (non-tobacco)," "preferred (tobacco)," and "standard (tobacco)." A small percentage of people have health conditions or histories that disqualify them for even "standard" rates. However, many in this group will be offered insurance at "impaired risk" or "nonstandard" rates.
Remember that the best policy is not necessarily the cheapest; you should also consider whether the policy addresses your overall goals.
Also, make sure to compare group and individual rates since, depending on your age and health status, group insurance may or may not provide a savings. In comparing group to individual life insurance, remember that if you have over $50,000 of group life insurance, IRS tables determine how much it costs your employer to provide the amount over $50,000 and adds that amount to your taxable income.
Also, the premiums on group life insurance plans tend to be high and the face value low. If you are healthy, you may get better rates by taking a medical exam, as insurance companies often offer discounts for people in good health.
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