The Ins and Outs of Finding Cheap Life Insurance
Life insurance is a very serious matter, it almost sounds irresponsible to say “cheap life insurance.” The fact of the matter is there are many people that should have life insurance that don’t. If you have anyone that depends on you, or your income it is advisable to have some form of life insurance.
There are many types of life insurance, which also means there is a large range of premium costs. There are three main types of life insurance: Term Life, Whole Life and Universal Life Insurance.
Term Life Insurance:
Term life insurance is by far the cheapest form of life insurance. It pays a fixed amount in the event of death and stays in effect for a fixed term. You can choose nearly any length of time for term life insurance with 15 and 30 years being the most common. The good thing about term life is the premiums are fixed for the life of the policy. If you are young and in good health, you can find really cheap term life insurance.
The bad thing about term life insurance is that you do not accumulate any equity. If the policy is not claimed during the term it simply ends and that’s that. Some insurance companies offer to convert your policy to a permanent life insurance policy, but the premiums generally are not fixed.
Whole Life Insurance:
Whole life is the most expensive of the three different life insurance options. It is a form of permanent life insurance that actually builds equity as it matures. Whole life policies have a cash value that grows as time goes on. This cash value can be liquidated for specific needs. Whole life has a guaranteed death benefit payment and has fixed monthly premiums.
Universal Life Insurance:
Universal life is cheaper than whole life, but is a bit more difficult to maintain. It doesn’t have a fixed payment schedule, nor does it have a fixed cash value growth rate. Universal policies don’t require a fixed payment schedule. You can pay as much as you want at any time. The insurance company takes out their fees from your cash value. Universal life insurance may be a cheaper option than whole life, but it is more of an investment vehicle.
If your primary goal is to find cheap life insurance you will probably be looking at a term life policy. In general, the younger you are when you start your term the lower your premiums, however this is not always the case. Insurers are always looking at their risk of losing money. In the case of life insurance the healthier you are, the less likely you are to make a claim. If you are healthy and don’t engage in high risk behaviors (sky diving, smoking, mining, etc.) you will pay lower premiums.
Another way to lower your life insurance premiums is to pick a lower death benefit payout. It is important that you choose a payout that will protect your loved ones. Once you decide upon a policy that fits your needs you should receive quotes from multiple insurance carriers. You will be on your way to cheap life insurance in no time.