Term life insurance costs the cheapest out of all other types of life insurance protection. Because term life insurance is temporary insurance for the term period and does not provide a cash value, savings account, or investment feature, if the policyholder does not die prematurely while the policy is in effect, the death benefit will not be paid out to beneficiaries.
Therefore, term life insurance costs are lower for insurance companies, who pass these savings onto policyholders in the form of cheap rates.
All life insurance companies calculate rates based on statistics that offer the probabilities that an individual will die within a certain time period, but the single most important factors are age and health, though other factors, like smoking or obesity are also part of the rating equation.
By applying for life insurance at a young age and making healthy lifestyle choices, applicants can lower their term life premiums.
Use of Alcohol and Tobacco Products
While moderate use or consumption of alcohol will not affect life insurance rates, alcohol or drug abuse not only increases rates but may make it impossible to buy term coverage. Use of tobacco products is known to cause cancer and other health conditions, such as cardiovascular disease, emphysema, and high blood pressure, which can reduce an individual’s life span and pose higher risk to the life insurance company who underwrites the term life policy.
Those who quit using tobacco increase their anticipated lifespan and are rewarded with cheaper costs. By quitting smoking, anyone can save money on their premiums, but the younger a person quits, the more he or she will save.
Health Risks and Obesity
Obesity is associated with the development of a number of serious health conditions, including type II diabetes and heart disease. There is also evidence to suggest that people who are obese may be at higher risk for certain types of cancer.
All of these health conditions are serious and can dramatically shorten a person’s lifespan, and insurance company doctors will note obesity during their examination of your health for underwriting purposes. For this reason quotes for obese individuals are higher than those for people with average weights. Losing weight through a well-balanced, healthy diet and regular exercise can get you drastically lower rates.
To see the difference in term life premiums between high risk and low risk applicants, consumers can compare life insurance quotes and see how much money they can save in premiums by being in shape and showing good health.
High Risk Life Insurance
Some activities, like sky diving, mountain climbing, and bungee jumping, have an inherent risk of serious injury or death. Individuals who regularly engage in high risk hobbies may be unable to get coverage at all, or can be required to purchase high risk life insurance. Those who do get life insurance will pay higher premium rates since their activities put them at much greater risk for premature death than others in their age group.
Any habit, activity or even occupation, which places an individual at a higher risk of premature death than the average individual in his/her risk category, will cause term life costs to increase significantly, and possibly make coverage impossible to afford.
Cheap Premiums With Discounts
In addition to making lifestyle changes, consumers can lower premiums by looking for discounts. The most common life insurance discount is a bundling discount which is offered to individuals who buy several different insurance policies, like auto, home and health insurance, with the same insurance company. As a rule, the company will offer a discount of up to 15% on each additional policy, which can make your insurance rates really cheap and affordable.
Other ways to get cheap life insurance include purchasing employer-subsidized protection, also known as group life insurance, which considers the reduced risk of a group of employees and makes rates cheaper for everyone. Look at your employee benefits before trying to buy private life insurance, since you may already have low cost coverage available to you.
Life Insurance Quotes
Another simple and painless way to lower your life insurance cost is to compare quotes on different policies from insurance companies to find the cheapest rates. Getting free, instant life insurance quotes from multiple insurance companies makes it easy and simple for consumers to compare policies, coverage, prices, and companies to find the best carrier for your needs.
To request a term life quote, an individual simply completes a brief questionnaire with rating information and the type and amount of coverage he or she wants. The life insurance quotes are no obligation estimates and are available instantly.
Cheap Term Life Policies
The single best way to get low term life rates is to buy protection as young as possible, since age and health is the biggest single factor affecting rates. However, there are ways for consumers to lower term life costs by making healthy lifestyle changes that not only result in cheap premiums, but improves your quality of life; though discounts and quote comparisons can help lower costs, too.