Life insurance is mandatory for your family's financial
security. However, in today's financial climate, it's smart to reduce budget
expenditures whenever you can. If you want to reduce the amount of money you
spend on life insurance,consider the following points.
1. Avoid purchasing a guarantee issue life
insurance policy.Guaranteed issue life insurance policies tend to be quite
pricey and with good reason. Companies who sell such policies guarantee that
they will issue anyone a life insurance policy, including people who suffer
from physical conditions that would not typically be accepted by life insurance
companies.
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So, if you're in good health, it's less
expensive to find a regular life insurance policy.
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However, a guarantee issue life insurance policy
might be the wisest choice for you if you're not in good health.
2. If you smoke, quit. Underwriters raise
the price of insurance by 25%-50% for tobacco users.
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When you quit smoking and have gone 12
months without using tobacco, you can request that the insurance company remove
the extra rating. Doing so will reduce your premiums.
3. Shop around.Each
company underwrites health concerns differently. For example, well-controlled
high blood pressure might not even warrant an extra charge with some companies,
while other companies will rate up the policy.
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When comparing rates, ensure you provide the
same health information to each company so the estimates will reflect your true
health condition and can be more easily compared in terms of price.
4. Strive for your ideal weight.When
shopping for insurance, it can save you money if you're at an average weight
for your age and sex.
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Each insurance company willrate additional
weight differently. After a certain amount of weight, extra pounds will raise
the cost of your insurance.
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If you're overweight, ask your agent to show you
the rating chart. If you're close to a border weight between categories, you may be able
to reduce your price by losing only a couple of pounds before you're
weighed by the company representative.
5. Cost isn't everything. Lower priced
policies can actually become more expensive. Companies with an A.M. Best rating
of A+ or bettermay charge more, but those extra costs pay off over the long
haul. Here's why:
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If you go with an insurance company because it
charges less and it goes out of business, then you have no insurance at all.
So, even though you've been paying for insurance, you could actually lose your
coverage and all the money you paid if you seek coverage from a risky company.
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In the event that a significant amount of time
has passed since you've purchased a policy from a company that goes out of
business, your health may have changed enough to make getting another policy
difficult.
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So, the lesson here is to check out your life insurance
company's ratings in advance of purchasing your policy as one way of ultimately
conserving your funds.
These are some of the most common strategies that can reduce
your costs when you purchase life insurance. If you practice good health
habits, shop around, and do business with a reputable life insurance company,
you can secure a life insurance policy that both saves you money and provides
for your family's needs in the future.
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