Saving on Life Insurance: Scoring the Best Deal

Author: Megan L. Mahan
Source: articleage.com

Most people know they need life insurance but are afraid they’ll
have to spend an arm and a leg to pay for it. Truthfully, there
are multiple ways to score affordable life insurance and they’re
much easier than you might have thought.

Getting Started

Knowing what kind of life insurance appeals to you will help
ease you into the shopping process. Generally speaking, there
are two types of life insurance: term life insurance and
permanent life insurance.

Term Life Insurance

Term life insurance covers you for a “term” or certain period
of time. This means a death benefit will only be paid out if you
die during that term. Terms range from five to 30 years; 20-year
term policies are most common, according to the Insurance
Information Institute (I.I.I.). Most policies can be renewed
after they expire, although the premium may increase as you age
and insurers typically won’t renew a term policy after you reach
your 80th birthday.

Permanent Life Insurance

Permanent life insurance comes in four forms: Whole, Variable,
Universal and Variable-Universal, and all of them will pay out a
death benefit whether you die right after you sign the policy or
decades from now. Each form of permanent life insurance has
different characteristics, although most permanent life
insurance includes an added cash value that grows over the
years. Because of these and other benefits, permanent policies
tend to be more costly that term policies.

A Time to Shop

Once you’ve researched the different policy types and found one
that appeals to you, it’s time to start looking.

Start by inquiring about employer-sponsored life insurance.
Group life insurance tends to be less expensive because some
employers subsidize the cost of premiums for their employees.
Another large benefit to employer-sponsored life insurance is
that you’re less likely to have to pass a physical exam.

However, the I.I.I. points out that you should still compare
group rates with individual life insurance to make sure you’re
getting the best deal.

Once you’ve discovered what your employer offers in terms of
life insurance, it’s time to look into individual rates. The
Internet has made this easier than ever, and independent
referral services like InsureMe can provide you with multiple
quotes from insurers to compare free of charge.

In addition to seeing which company can give you the best deal,
you should also investigate the following before choosing an
insurer:

Financial stability. The cheapest policy in the state
won’t do your family any good if the company can’t pay the claim
or becomes insolvent. Rating companies like A.M. Best can give
you this information free of charge.

Customer service. Few people know the value of good
customer service until they’ve had a bad experience. Prevent bad
experiences from the outset and check customer satisfaction
ratings with A.M. Best.

Make sure term policies carry a renewal guarantee. A
renewal clause will ensure that you’ll be able to renew your
policy after your term expires. While you may pay more to renew
your policy (due to your increase in age), chances are that you
won’t have to undergo a medical exam to renew–which will be of
major benefit if your health has deteriorated since you first
purchased the policy.

More Tips for the Road

You can ensure the lowest possible life insurance premium and:

Get healthy. If you smoke or are overweight, you’ll
almost certainly pay more for life insurance–especially on an
individual policy. So put down the smokes and develop an
exercise regimen to see your life insurance premiums fall.

Inquire about discounts. The I.I.I. reports that many
insurers grant discounts for specified amounts. For example, you
may actually pay more for a $200,000 policy than you would for a
$250,000. Ask about these discounts before you sign a policy and
see a reduction in your premium.

Buy young. While younger adults tend to let life
insurance fall by the wayside, purchasing a policy while you’re
young and free of most age-related ailments will help you secure
an affordable life insurance policy for years to come.

Start Planning for the Future Today

While life insurance may seem like just another bill to pay,
remember that it’s an important part of taking care of your
loved ones. But, it doesn’t have to eat up your paycheck–use
these tips to find affordable
life insurance today.

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About InsureMe

InsureMe links agents nationwide with consumers shopping for
insurance. Specializing in health, auto, home, long-term care
and life insurance quotes,
the InsureMe network provides thousands of agents with insurance leads every
year. For more information, visit InsureMe.com.

Term Life Insurance and Permanent Life Insurance

Author: Bill Walker
Source: articleage.com

Term insurance and permanent insurance are two basic types of life insurance. Term life insurance is temporary, and it covers only a specific period of time called the relevant term. Permanent life insurance is the type of insurance where the policy is for the life of the insured and the payout is assured at the end of the policy. Term life insurance builds on cash value while permanent life insurance accrues cash value.
Now let’s look at the pros and cons for term life insurance and permanent life insurance.
Term insurance has two advantages. First, its initial premiums are usually lower than the initial premiums of permanent insurance. Secondly, term insurance is better for covering needs such as loans or mortgages, which will disappear in time.
There are a few disadvantages in term life insurance: Coverage might become too expensive to keep or terminate at the end of the term. Also, the premiums increase with ages. Besides, paid-up insurance and cash value are usually not offered.
The advantages of permanent insurance are as follow: You get a guaranteed protection for life as long as you have paid the premiums. Secondly, a cash value is accumulated with the policy and you can borrow from it. Thirdly, you can choose to set the premium costs whether fixed or flexible depending on your needs. Besides, a permanent insurance policy’s cash value can be surrendered for cash value. In addition, you can add a provision to the policy for the option of purchasing additional insurance without having to providing evidence of insurability.
There are a couple of disadvantages in permanent life insurance. First of all, the required premium levels might make buying enough protection harder. Also, if not kept long enough, permanent life insurance might be more costly than term life insurance.
Bill Walker is a freelance writer. He has written insurance related articles for websites such as Insurance Guide ( http://insurance-guide.netfirms.com )