Did you know that life insurance ownership is at a 50-year low?
In fact, though over 80% of the American population thinks that life insurance is important, only around 60% of Americans have any life insurance coverage at all.
The reason?
One of the most common ones is that most people believe a life insurance policy is just too expensive.
However, a recent study showed that the people who don’t yet have a life insurance policy are wrong about what they assume it costs.
In fact, many believe that life insurance costs three times more than what it actually does.
The reality is that cheap life insurance policies are out there – and you need to get one to protect the people you care about.
So, what are the benefits of cheap life insurance?
Is it right for you?
In this post, we’re telling you everything you need to know, and breaking the myth that you can’t afford life insurance.
Understanding Whole Vs. Term Life Insurance
Before we get into offering you more specific tips about how to find cheap life insurance, let’s go over two of the most common types of policies.
In this section, we’re going to talk about whole vs. term life insurance.
Whole Life Insurance
Whole life insurance is probably the most well-known type of life insurance – but it’s also one of the most expensive.
Basically, a whole life insurance does what its name implies: it covers you for your whole life.
It also has something called a cash value. The cash value is actually something you invest in. It is tax-deferred, and your cash value will increase (albeit slowly) over time.
If you need that cash value, it is possible to borrow some money from your whole life insurance policy. However, you need to repay what you borrow – with interest.
If you don’t make those payments, the policy’s payout (which goes to the insurance company, not your family members) will decrease.
However, there are some benefits to whole life insurance – if you can afford it.
You’ll get a guaranteed rate of growth on your investment cash value. You’re also guaranteed to get a payout upon your death. Finally, your premium will stay the same during your lifetime.
However, dividends are not promised. This means that if you need cash on a yearly basis from your policy, this isn’t a good fit for you.
It’s also pretty risky because there are investments involved. Plus, it’s much more expensive up front and carries high penalties.
For many, whole life insurance is just too complicated and expensive. So, what can you do?
Term Life Insurance
For many, term life insurance is the best cheap life insurance policy option out there.
Instead of giving you coverage for your entire life, you are covered only for a specific amount of time.
Basically, if you die before an expected time, your heirs and family will be covered. Plus, they’ll get a death benefit that goes to them directly.
We love that you can select the term you’d like to be covered for. Usually, that’s anywhere from 10-30 years.
Plus, there are much lower fees associated with term life insurance. In general, it’s the more affordable option – plus, it offers you great flexibility. You’ll also pay a lower premium, and that premium usually stays fixed.
Even better?
Term life insurance policies are renewable. This means that, when your term runs out, if you get a renewable policy, you don’t have to re-qualify for coverage if you want to renew it.
Who doesn’t love that?
Who Should Get Term Life Insurance?
So, who should get this cheap life insurance, and when should they get it?
It’s the time to get term life insurance if you meet any of the following criteria:
- You’re under 50 years old
- They’ll be the cheapest then
- You want to spend your money on high-growth investments instead
- You’re not sure about your health
- You just want a death benefit
How Can You Get The Best Deal On Cheap Life Insurance?
Nobody wants to pay more money than they have to for life insurance.
However, there are a few things you can to be sure you’re really getting the best possible deal.
Read on to find out what they are – you don’t want to miss this.
Compare Your Quotes
You should never take the first offer that comes your way – the same goes for finding the best cheap life insurance policy!
Instead, really take the time to shop around. We know that it may seem like it takes too much time, but comparing quotes can really make a difference.
If you don’t have the time to go in person to several agencies, you can always do a little online research instead.
Plus, doing your research avoids buyer’s remorse and prevents you from getting hit with any fees should you cancel your policy to move to a more affordable one.
Get it right the first time instead.
Avoid Non-Mandatory Medical Tests
It may not always be fair, but it’s the truth: if you have serious health conditions, the costs of your policy can rise.
Even if you think you’re taking good care of yourself, a test can sometimes have some unexpected results – that can drive up your costs.
Instead, look into options that don’t require you to take a medical examination in order to get the coverage you need.
Keep Following The Law
Yes, it’s true – if you’ve been to prison, your record may make it that much harder for you to find the coverage you need.
If you’ve served time, there are options. However, when you go in to meet with your agent, be prepared to discuss the following things:
- Your crime
- The length of your sentence
- How long it’s been since your release date
- Whether or not you’re currently on parole
However, many term life companies are still interested in offering cheap life insurance to those who have served some time. If you don’t have a record, do your best to keep it that way.
Keep Your Eye Out For Riders
Even if you get an offer that sounds tempting, resist the urge to add a rider onto your cheap life insurance policy.
These riders can be things like policies for your children, speeding up your death benefit, or even offering you a lump sum for any medical expenses you’ve incurred if you’re terminally ill.
Of course, you may need some of these riders – especially if you have children. Again, always walk into a meeting with a level head and think about what’s really necessary.
Do It Now
It’s not just your age that impacts the coverage you’re able to get.
The reality is that it’s best to take a “the sooner, the better” approach to life insurance because you never know when your current health, financial, or even personal situation might change.
When you’re young, in good health, and working is the best time to take out a life insurance policy. You could get sick at any time. If you wait until you develop a serious medical problem to seek coverage, you’re going to see your costs soar.
Look Into Combining Types Of Coverage
Are you also interested in looking to insure your car, your home, or pretty much anything else?
Then you’re in luck. These days, it’s often possible to “bundle” these coverages in with your life insurance policy. It’s an incredible way to save money and to protect even more of the things you love.
Make Sure Your Insurance Company Is Reputable
Finally, this is the most important step in looking for cheap life insurance.
You can be offered the best policy in the world…but if the company can’t actually pay you what they’re offering, you’re out of luck – and so is your family.
You need to ensure you’re working with a reputable company.
When you’re looking at your options, always make sure the company you’re considering is financially strong and solvent. You can often do this online, with a simple inquiry into an agency that rates insurance providers.
Ready To Get Your Cheap Life Insurance Policy?
No matter what you initially thought, we hope this guide to affordable life insurance has proved to you that coverage is well within your reach.
There’s no excuse for waiting until it’s too late to start thinking about what will happen to your family if something happens to you.
Instead, follow the guidelines we listed above to make sure you get the best rates, work with the top insurers, and pick the policy that’s right for you.
Looking for more no-nonsense and plain-English advice about life insurance?
We’re telling you everything you need to know about all the different types of life insurance out there – so you can make an informed choice about your policy.
Keep checking back with our website and blog to get up-to-the-minute news and advice.
Always feel free to get in touch with us with any questions or concerns.
You can afford coverage – you just have to know where to look.
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