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Top 10 Ways to Lower Your Life Insurance Costs

Licensed Life Insurance Agent/Marketing Manager
April 03, 2020

Whether you have already been approved and aren't thrilled with the cost or you are shopping around and are looking to have a lower rate, we have tips to help you lower the cost. You may be surprised by some ways you can lower your life insurance costs. 

Top 10 Ways to Lower Life Insurance Premiums

There are many ways you can work towards lowering the rate you pay for life insurance. This list will breakdown the top 10 ways to lower your costs. Some of these may take more time to accomplish and see lower rates than others.

1. Get a second opinion

This is one of the easiest ways to lower your life insurance costs quickly.

The company that you are looking at or have already applied with, may not be the best fit for you. That means that they may not have the cheapest life insurance rates for your situation.

Typically once you go through the medical exam or answer other health questions you may see a higher price than the original quote. It pays to shop around with other companies.

2. Improve your driving record

Multiple tickets, accidents, or DUI’s during a set period of time could lead some insurance companies to either deny an application or postpone the life insurance application until your DMV record is clean.

This one can take some time as insurance companies usually have a set period of time they are looking at to see if you have any driving violations. Check with the life insurance company to see what the timeline is. For now, focus on driving the speed limit and avoiding any accidents. In the long run this will help save you money on a policy. 

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3. Diet and excercise

Life insurance companies look at your height and weight and take that into consideration when determining your rate.

Changing your diet and exercise can make an impact on how much you will ultimately pay for life insurance.

Or there may be other life insurance companies out there that don't have as strict of guidelines with height to weight ratio. This takes us back to #1, it is important to shop around for the right company.

4. Quit smoking

One easy way to lower the cost of life insurance is to stop smoking. This one will take time as generally the life insurance company will ask you if you have used tobacco products in a set period of time. 

Now if you are looking for life insurance and use some other type of tobacco product such as cigar, chewing tobacco, electronic cigarette, etc… There could be good news out there for you. In fact, you could theoretically qualify for a non-tobacco rate provided you know where to look!

5. Stay away from hazardous hobbies

You may be wondering what your hobbies have to do with your life insurance rate. If you like to do extreme sports or any other activities that a life insurance company could consider high risk, this can increase the amount you pay for life insurance. 

Staying away from what life insurance companies consider to be "risky" hobbies can help you save money.  

6. Pay annually

Some insurance companies will allow you to pay annually, which ends up being cheaper than if you pay monthly. Some companies add fees for paying monthly or just offer discounts for paying annually.

While the upfront cost can feel like more, you are actually saving in the long run by choosing to pay your policy annually. 

7. Don't add riders

Riders are additional coverage options that you can add on to your life insurance policy. While they can provide great additions to your policy, they will cost you more. 

If you are trying to save money, skip the riders for now and see if you can add them at a later time when you are able to pay a little more. 

There are some riders that you can add without an additional charge, so ask your life insurance agent about your options and how they will affect your rate. 

8. Get a term policy

If you are just needing life insurance coverage for a certain period of time, you should consider getting a term life insurance policy. Term is the cheapest form of life insurance. 

It is important to note that it is cheaper now, but if it ends and you still need more coverage, you could end up buying substantially more later. 

9. Lower coverage amount

Really evaluate how much life insurance you need. Consider expenses you would need to cover and if any income would need to be replaced. 

If you are trying to save money, there's no reason to buy more coverage than you actually need. 

If you still need a larger amount consider trying the ladder strategy. With this strategy you take the larger amount that you need and break it into smaller and different term lengths to cover the expenses or income replacement only for the amount of time you will need. it. 

10. Lower the policy length

This one goes along with #9. Evaluate how much coverage you need and for how long. Shortening the amount of time a policy is active can save you money. 

Using the ladder strategy can be helpful in saving money on the length of the policy as well. 

Conclusion

These are just ten ways to lower life insurance premiums. While some of the tips on our list can take time, they can save you money in the long term.

It is also important to note that the older you get, the more expensive your rate will be so don't wait too long to take the steps necessary to lower your rate.

Written by
Chelsie Ball
Chelsie is fixated on developing innovative ways to present complex ideas and maneuvering people to the information they need. She has worked in digital marketing for the past eight years and has been a licensed life insurance agent since 2010. When she isn’t looking out for the user, you can find her watching Netflix or desperately trying to find a real hobby.