4 Savvy Strategies for Lowering Your Life Insurance Premiums

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Life insurance doesn’t have to be expensive. Here are a few ways to keep your premiums down. 

The cost of nearly everything has spiked over the past few years, and insurance prices haven’t escaped the increase. Life insurance applications rose significantly during the height of the pandemic and are still above 2019 levels. And insurance companies could soon factor in the potential long-term health effects of COVID-19, making some policies potentially more costly.

Thankfully, you have options to lower your life insurance premiums. Some are easier than others, but even implementing a few could help you reduce your insurance costs.

1. Pick the right coverage

Like other types of insurance, there are always different tiers you can choose. The trick is to find the right amount of coverage without overspending.

The simplest way to find the right coverage is to add up the debt you want to be paid off with a life insurance policy should you pass away unexpectedly. Ask yourself how much money your family would need to cover bills, debts, and any additional money they might need to cover the loss of income.

Then, find a policy that covers the amount you’ve come up with, or near that amount, that stays within your budget. For most people, choosing a term life insurance policy will be cheaper than signing up for whole life insurance. Term life insurance gives you coverage for a set period and then expires, ensuring you don’t pay for a policy you no longer need.

2. Compare rate quotes

It’s easy to assume that all life insurance companies will offer the same policies at the same prices, but that’s not always the case. Just as mortgage lenders and credit card companies look at the same borrower differently, insurance companies write policies differently.

This means you should compare life insurance quotes from different companies to ensure you get the best deal. Look closely at what coverage they’re offering, how long the policy is good for, and how much your monthly premiums will be.

If finding cheaper life insurance is your goal, one of the best ways is to get quotes from a few insurers and compare what they offer. Remember, you’ll likely be paying the premium for many years, so comparing quotes could save you significant money.

3. Get into healthy habits

As with any insurance policy, companies decide how much risk they’re taking on when offering policies and set premiums based on that risk. This means that the healthier you are, the more likely it’ll be that you’ll pay less for your life insurance.

Of course, there are some things you can’t control, like your age or genetic vulnerabilities. But something you do have control over, like smoking, can significantly impact your premiums.

Some companies offer life insurance without requiring a health exam, but you’ll usually pay more. Instead, find a policy that requires the exam. Not only will you find out more about your own health, you’ll likely end up paying less for your life insurance policy.

4. Reconsider risky hobbies

You’ll likely pay extra for your life insurance if you’re into extreme hobbies like racing motorcycles or skydiving. While you don’t have to give up your hobbies, you may want to consider which ones you do and how different insurance companies view that activity.

Not all companies look at risky hobbies the same way, so if you’re scuba diving on the weekends, you may want to spend some extra time shopping for the best deal.

Thankfully, you can find the right life insurance policy for you online easily these days. And with many companies providing fast quotes for policies, you can quickly start comparing policies after answering a few questions.

Our picks for best life insurance companies

Life insurance is essential if you have people depending on you. We’ve combed through the options and developed a best-in-class list for life insurance coverage. This guide will help you find the best life insurance companies and the right type of policy for your needs. Read our free review today.

We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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