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5 Ways to Get the Best Deal on Life Insurance

Friday, 18 Feb 2011 10:07 AM


Life insurance benefits can be invaluable especially in the event of the death of the family breadwinner. Life is uncertain and unpredictable, which is why everyone should have life insurance in order to support loved ones in case of death.

Several life insurance companies offer a variety of life insurance policies at varied premiums, different benefits patterns, and for different term periods. Understanding which type of life insurance is best and getting the best deals on life insurance can be a challenge.

Here are five ways to get the best deals on life insurance.

1. Determine your needs
Determine the policy proceeds that you need and the time period after which you need the proceeds. The insurance amount should ideally be ten to twelve times your annual income. Insuring for too little would not suffice the need and insuring for a very high amount will exponentially increase the premium.

2. Determine your liability in case of death
Liability can be determined by taking into account the mortgage payments, credit card bills, car payments, or other outstanding loans, children's annual education cost, how much money would your family need in case of your death, and other sources of income that can pay for some or all of your liabilities. This ensures you get a good deal on life insurance policy.

3. Do not obtain insurance for investment
Keep investment and insurance separate. Although many companies offer life insurance policies with additional investment objective and benefits, the benefits are far less compared to instruments meant for investment alone. Combining investment motive with insurance will increase your premium and the returns are not proportional to the high premium. In this way you can negotiate a best deal on life insurance.

4. Get insurance while healthy; regular source of income gets you the best deals on life insurance
When your medical exam reports show you are in good health, the insurance companies offer a lower premium as their risk is considerably reduced. Even if you have a medical condition that you are under treated for, tell the truth, do not lie about it. Although the premium may increase slightly due to your medical condition, this ensures coverage. If you lie about it and the condition turns out to be a cause of death, the companies may investigate and chances are that your family will lose the insurance proceeds.

5. Compare insurance quotes on the internet or among insurance agents
Insurance companies have their own methods of assessing the risk and cost of a policy. Policy premiums differ from one company to another. There may be some hidden terms that you need to clarify. Comparing insurance quotes ensures that you get the best deal on your life insurance or a good deal on online life insurance.


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