Want inexpensive life insurance? Consider these strategies
For Americans who don’t have life insurance, you could leave your loved ones and dependents in dire financial straits if you die unexpectedly.
The 2020 Insurance Barometer study found that 65% of Americans said the reason they didn’t have life insurance was because it was too expensive. The average cost of a term life insurance policy is almost $ 160 per year. However, more than half of the population seems to think that term life insurance is more than three times as expensive.
It is possible to get cheaper life insurance, and the affordability might surprise you. If you are purchasing life insurance, you can visit Credible to explore your life insurance options.
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How to get a cheap life insurance policy
Life insurance doesn’t have to be expensive. Here are some of the ways you can get a cheaper life insurance policy:
- Get term life insurance
- Shop and Compare Life Insurance Quotes
- Buy ASAP
- Build a life insurance ladder
- Avoid simplified issue life insurance
1. Get term life insurance
When shopping for life insurance, you may notice that you have two options: permanent life insurance and term life insurance.
Term life insurance is more short term. You choose a specific amount of insurance coverage and the policy is active for a specified period, typically five to 30 years. Once it expires, you need to renew it.
Insurance premiums for this are usually cheaper and the price depends on your age, medical condition, and the amount of coverage.
2. Shop and Compare Life Insurance Quotes
When shopping for life insurance, don’t stop at the first quote. Online insurance rates are often the lowest available, but that doesn’t mean you will qualify for that rate.
Get quotes from multiple insurance companies or work with an insurance broker before making your decision to get cheaper life insurance.
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3. Buy as early as possible
Your age and your health are two big factors in determining whether you will benefit from cheaper life insurance rates.
If you are younger and in good health, you will pay less for coverage. Most people in their twenties don’t usually think about life insurance, but every year you wait the cost of coverage goes up. The sooner you plan to buy life insurance, the better.
4. Build a life insurance ladder
More coverage means your life insurance policy will be more expensive. However, you still need sufficient coverage to financially protect those who depend on you.
A cheaper life insurance strategy is called the ladder. You need different levels of coverage at different stages in your life. By building a life insurance ladder, you buy smaller policies that expire at different times.
5. Avoid simplified issue life insurance
Simplified Issue Life Insurance means you answer a few questions about your medical history without a medical exam. It might sound like a great insurance option, but it can cost twice as much as insurers take on greater risk.
For cheaper life insurance, it’s best to bite the bullet and get a medical exam if that means you’re paying less for the same amount of coverage.
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Things to consider when buying life insurance
There are many things you should consider before purchasing life insurance. When you start planning, you are also more likely to receive cheaper rates. Here are some key factors to consider:
- Assess your current financial situation
- Determine the coverage you need
- Understand what affects your rate
1. Assess your current financial situation
If you die unexpectedly, you need to consider loved ones who are financially dependent on you.
Know exactly where you stand financially before purchasing a life insurance policy to determine what type of life insurance you need and how much. While there are many benefits to having a good credit rating, it doesn’t affect your life insurance premiums. Insurers give you an insurance score based on your financial history, not your credit score.
2. Determine the coverage you need
Don’t just pick a number from nothing. Most people underestimate the coverage they need.
Consider all of your debts and assets. If you have significant savings and minimal debt, you may not need as much coverage.
3. Understand what affects your rate
Life insurance rates are determined by your age, state of health, the type of policy you purchase, and the amount of the death benefit. With a term life insurance policy, the length of the term will also affect your premium.
You can explore the prices and find the right life insurance plan that meets your needs on Credible.
The bottom line
Start by shopping around for cheaper life insurance and never settle for the first rate you’re offered. You can compare life insurance companies and shop for their plans through Credible.
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