A
word that people use interchangeably
with affordable is cheap when it comes
to purchasing term life insurance.
Term life, by definition is cheap but
let's look at some tricks to get the
best rate on the market. You can
always read our article on
why term life
makes sense (hint...it's
cheap) but take a look at how to find
cheap life insurance that comes through
when you need it.
The
first thing you want to do is have lots
of options to choose from. If a
life insurance
agent is only showing you one
or two plans from one or two carriers,
there's a good chance that's not cheap
insurance. Our term life quoting
engine will quote multiple carriers and
plans and even find the best rates for a
given combination of amount of coverage
and length of time. Now that we
have that out of the way, let's look at
techniques to keep the coverage as cheap
as possible.
Paramedical Exam
A big
part of the cost you will pay comes down
to the
term life health
class that you fall under.
This is function of how your health
status and history matches up with the
life carrier's underwriting guidelines.
Part of this equation is the paramedical
exam that you take as part of the
application process. There are
some secrets to get the absolute best
results from the paramedical exam which
are pretty much common sense. We
cover this entire process at our
paramedical exam
article.
Price
Points
Each
carrier typically has price points, or
in life insurance parlance, "Premium
Bands". This means that
you may pay less for each dollar of
coverage getting $250K then if you were
to purchase $200K (assuming that
particular carrier's next price band
starts at $250K...which is pretty
common). You can request the
brochure from us which usually lists
their premium bands or we can track that
down for you. Ultimately, our
quoting engine allows you to re-run your
quote under different amounts so can
find the right premium for you.
Buy
Early
There
is really a penalty to waiting or
procrastination when it comes to term
life insurance. Life insurance
rates are based on the age at the time
of enrollment so more than anything,
cheap term life means buying when your
young. You can pay considerably
more in premium over a given period if
you wait 5 or 10 years so there's really
no reason to wait once the need for life
insurance is present (i.e. birth of
children, new house, etc).
Riders
Unless a
Term life rider
really speaks to you or addresses a
concern or fear that you have, it's hard
to justify the extra premium you will
pay versus the risk they address.
That's our personal opinion and
ultimately, you need to sleep well at
night but we would rather you put that
premium amount into pure term where it
can do a lot more good.
Carrier ratings
It's
important to understand that although
the
carrier rating
is important, each State usually has
some kind of protection up to a certain
amount so it's not necessarily in your
interest to limit yourself to only the
very top rate carrier or plan.
Somewhere in the middle is probably the
best approach and also the one that is
more likely to end with you finding
cheap term life insurance that will
protect you and your loved ones.
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