Buying life insurance can seem like a difficult and expensive endeavor if you haven’t done it before. Both can be overcome if you have a good insurance agent.
Here are nine ways to save on life insurance, all of which you should ask your agent about:
1. Don’t smoke: Smokers are more likely to die younger than nonsmokers, making smoking one of the biggest health risks and reasons to have higher insurance rates — at least double that of a nonsmoker.
2. Weigh less: Your height and weight are an indication of the probability of illness or death, so you want your weight to be in a healthy proportion to your height, as measured with a BMI calculator.
3. Avoid risky behaviors: Risky behaviors such as race car driving, scuba diving, and flying a plane are considered hazardous hobbies that increase the chance you’ll die or have an accident. If you’re going to keep doing those things, you may need a rider on your policy to exclude benefits if you are injured or die while doing them. Being a good driver can help lower your life insurance premium.
4. No expensive riders: You can also add riders to a policy for activities, though the riders can be expensive and go beyond the life insurance basics of insuring your life for your family’s sake.
5. Improve your credit: Your credit score may be used to determine the probability of maintaining the insurance policy. A good credit record can help you get the best insurance rates.
6. Shop around: Shopping around is a smart idea for many purchases, including life insurance. If you have a health condition, such as diabetes, then insurance rates can vary widely by insurer.
7. Buy young: Don’t wait to buy life insurance. Every year you wait, your insurance costs rise.
8. Lower the death benefit: The total amount of the death benefit helps determine the premium. Obviously, a $1 million death benefit costs more than a $250,000 one. But choose it carefully. Your beneficiaries may have a difficult time if you don’t leave them enough money, and too much money can cost you a lot more in higher premiums.
9. Save money and invest: Building your assets up to a sizable amount over time can mean you won’t need life insurance later in life because your family will already have the money they need in the bank when you die.
In fact, that may be the first thing to discuss with your family: How much life insurance you need, if you need any at all. Then, an insurance agent can help you decide how much coverage you need, and should be able to help you wade through these and other possible discounts.