Login
Password

Forgot your password?

Best Term Insurance

By Edited May 2, 2014 0 0

There are a number of strategies you can utilize to get the best term insurance.  Think of life insurance as part of your overall financial plan and then take necessary steps to keep costs down.  

 First,  get life insurance when you are still very young, particularly if  you plan on getting married and having children.  You should buy this life insurance as soon as possible, preferably before the age of 25.   Life insurance premiums are largely based on age and are also partially based on health.  Since the risk of having health problems increases as you age, you should  take advantage of this and get life insurance while you are young and healthy.

Second, realize that your life insurance is an individualized decision and there are different types of life insurance policies for different people.   Depending on your situation, you  may need a longer term policy, i.e. 30 years,  to cover you family's needs.   You may need a higher or lower policy coverage amount than then next person, when considering your assets and comfort level.     Don't let anyone talk you into taking any life insurance policy that you doesn't meet your needs.

Next, you don't necessarily have to pay monthly for best term insurance. That's typically the most expensive way to pay.  If you make payments semi-annually or annually, you will get better premiums. If you do pay monthly, look into paying with automatic electronic bankdrafts, as that may save slightly on costs. 

Buy either the best term insurance or universal life insurance. Although it really did seem like a good idea at the time it was first conceived of, whole life insurance, which tends to pay the highest commissions to the insurance broker, and tends to be the worst deal of the lot, for many reasons.

Also, it might help you to go with an insurance broker to save money on the best term insurance. Different insurance companies have somewhat different standards of underwriting. You might be the healthiest person anyone ever met, but have a weekend hobby that's considered "risky", such as bungee jumping, which can raise your premiums. You can also have your premiums raised if you like to toke on a cigar twice a week--you're considered a "tobacco user" by the great majority of life insurance companies if you do that, even though you would have to toke the same way for probably 200 years before you realized an actual health detriment from it. Life insurance actuaries really hate tobacco and they err on the side of caution because of it.  Life insurance brokers can find you insurance companies who specialize in cigar smokers and bunjee jumping.

Understand  that it often pays to buy life insurance on volume--hence, the more life insurance you buy, the better a deal you'll get.   There are typically price breaks at certain multiples of $1000 of death benefit. At certain break points, such as $250,000, half a million, etc, the cost to purchase that many $1000 units of coverage dramatically decreases (as long as you buy them all at once). It's better to be overinsured than underinsured, alhtough  most people tend to be underinsured. TA lot of people are attracted to $100,000 and $250,000 policies because these are "round numbers" and they sound large. The fact is that people need eight to 10 times their annual salary to have sufficient coverage. A person making "a mere" $40,000 a year thus needs likely $400,000 of coverage.

 

 

Advertisement

Comments

Add a new comment - No HTML
You must be logged in and verified to post a comment. Please log in or sign up to comment.

Explore InfoBarrel

Auto Business & Money Entertainment Environment Health History Home & Garden InfoBarrel University Lifestyle Sports Technology Travel & Places
© Copyright 2008 - 2016 by Hinzie Media Inc. Terms of Service Privacy Policy XML Sitemap

Follow IB Business & Money