How to Save Money on Life Insurance

Geoff Cook - CFP, CHAIP

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life Insurance Barrie

Lets face it, no one likes buying or paying for insurance. In fact I often hear people say they feel insurance poor. From time to time I will meet people who want or already have life insurance and they say "Hey, how can I save money on life insurance?"

There is always pro's and con's to everything but with purely short term cost in mind I have put together a little list of how you can save money on your premiums.

How To Save Money on Life Insurance

Pay annually not monthly – By paying annually you will save on average 8% on the premium.

For example: I just ran a quote for a 30yr old non-smoker for 500k of Term-10.
Annual Premium = $290
Monthly Premium = $26.10 (x) 12 = $313

In this case savings were exactly 8%.

Buy Term-10 not Term-20 – This will allow you to either save money on your coverage amount, or purchase more insurance for the same price. 10 years is a long way away. You can change your Life insurance policy in a heartbeat…nothing is cast in stone. Many companies now allow you to exchange your Term-10 to a Term-20 without having to prove insurability. Most companies will also allow you to change your Term-10 to a permanent product without having to prove insurability. This ensures that if you become un-insurable in your first 10 years you will still be able to buy insurance for life and pay a discount on the payout.

For example: Using the same example from above - Female 30yr. old non-smoker

A term-20 for $500,000 of life insurance would cost - $26.10
Using the same premium she could get - $1,000,289 of Term-10

At the end of the day if I showed up to the front door with a cheque to deliver to the wife she doesn't say "Was that a Term-10 or Term-20", she says "How much money is in the envelope".

Buy Joint-Life First To Die (JFTD) or Multi-Life instead of Single-Life – This in many cases will save you a few bucks, and at least save a policy fee which averages $50 - $75 per year. Multi Life will often only save you the policy fee. By purchasing JFTD you will often save some extra money on premium. Many companies allow you to re-purchase a policy without proving insurability on first death, and many will also double the payout if both parties pass away within 90 days of each other.

Look at preferred underwriting guidelines – Many companies offer cheaper rates to those people who are in above average underwriting guidelines. This looks at your health history, weight/height, family history and other things. If a company decides you are preferred, you will get a better rate. Not all companies have the same preferred guidelines, so look to see which companies have the best preferred pricing, and see if you fall within their guidelines. To see an example of a companies preferred guidelines – Click Here

Look at the whole market – not just the big 3 – Many people may not know there are a wide variety of Life Insurance providers in Canada. Each has their own markets they are competitive in. If we only look at the big companies like Sun Life, Manulife, and Great West Life then we are cutting out a massive part of the market. It is important to work with a broker who can show you all the companies’ prices.

For a free no hassle quote please dont hesitate to Contact Us. We will send you a quote from the top 15 best priced companies in Canada. Or you can visit our no hassle quoting website - www.lifeinsurancecheap.ca

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Infinite Financial is an independently owned and operated Financial Services company in Barrie, Ontario. We specialize in Life Insurance, Retirement Planning and Estate Planning.

Our Certified Financial Planners represent the major Banks, Investment, and Life Insurance companies in Canada. We pride ourselves in offering advice independent of any particular Life Insurance, Bank or Investment firm and based strictly on client’s needs.

Contact us today or stop by our office in Barrie to say Hello!

Infinite Financial places mutual fund transactions through Banwell Financial Inc. and Life Insurance transactions through Bridgeforce. To learn more about these relationships - click here

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