At InsuranceScored, we help consumers understand how to find the cheapest life insurance rates available.
I think you’ll agree with me when I say it’s hard to find cheap life insurance that you can actually qualify for.
It turns out it’s actually pretty easy if you know what you’re doing.
This article will cover:
- How To Secure The Cheapest Life Insurance
- Where to find Cheap Life Insurance
- Different Types of Life Insurance
- How Life Insurance Premiums Are Determined
- Which Type of Life Insurance is Most Affordable (It’s not just term)
- Critical Information To Keep In Mind
Take a few minutes to read through this guide to educate yourself and know more than 99% of life insurance consumers on how to actually secure the cheapest life insurance.
Lets first talk about the “How” since that’s probably top of mind for you.
How To Secure The Cheapest Life Insurance
Every article on the net will tell you to use an independent life insurance agent and it’s for good reason – that is the best way.
I know it’s hard to trust a life insurance agent you don’t know, so here’s a simple 2 step method to make sure you’re actually getting cheap life insurance:
- Get instant quotes with the right health classification. (You can do that on the sidebar, but read below first)
- Go down the list of quotes with an independent life insurance agent and ask why you can’t qualify for those rates.
When you get instant quotes, make sure the health classification is accurate.
Here’s a very general reference:
Preferred Plus: Superman health. No health issues now or in the past. No medications or criminal history.
Preferred: Great health, but might take a medication for cholesterol, high blood pressure etc.
Regular Plus: Above average health. Some medications, maybe a little overweight.
Regular: Average health. You have some health concerns, but nothing to be concerned with.
Choose your health classification carefully in order to receive accurate rates. Most life insurance companies will require you to undergo a physical exam to determine how much of a risk you will be to the company to insure. If you feel your health will not allow you to qualify for a traditional life insurance policy, there is the option to look into a no physical exam required life insurance policy or life insurance for high risk people, which will come with a higher premium. You’ll get exact rates from dozens of top rated life insurance companies. These are the same rates as if you called the company directly.
The results will look something like this:
Now print this screen or write down the cheapest life insurance companies displayed.
Then when you speak with an independent life insurance agent and he/she quotes you and it’s more expensive than what you saw, ask them why you can’t qualify for the top rate that you have right in front of you. Then go down the list of companies and have that agent tell you the exact reason you can’t qualify for it.
Keep in mind that life insurance companies view every risk differently. Each carrier has their “niches” for risk. By doing this exercise, you’re qualifying the agent that’s working with you by testing their knowledge of each company. If they can’t give you a good reason why you can’t qualify for a specific company, apply with that company.
The most critical advice we can give is this:
Life insurance rates are the same no matter where you go. The technology of instant quotes you can get on our site makes everything transparent. Go with an agent who demonstrates knowledge and who you feel sincerely wants to help.
Where to Find Cheap Life Insurance
Life insurance is a very competitive market (which is great for you!) which forces most insurance companies provide low cost insurance term life insurance rates. All you have to do to find the most affordable life insurance provider, is compare the quotes side by side by an unbiased source.
InsuranceScored.com is an unbiased source.
Complete the form on this page and quotes will be displayed on the next screen from the nation’s top rated life insurance companies. These quotes won’t be any different than the life insurance companies directly.
Although most life insurance policies serve the purpose of providing a benefit upon one’s death, there are actually several cheap life insurance policies and their types to choose from.
Knowing how different types of insurance policies work can help you to better choose the most affordable coverage and what type of benefit will best fit your specific situation.
Different Types of Life Insurance
In general, there are two primary classes of life insurance. These are term and permanent. Term life insurance provides only a death benefit, without any type of cash or investment build-up within the policy. This is typically the simplest and cheapest life insurance coverage.
Permanent life insurance also provides the insured’s beneficiary (or beneficiaries) with a death benefit. However, in addition, these policies offer a cash value component that can act as a type of savings account.
The premiums on permanent life insurance are generally higher than those on term insurance policies. However, this is primarily due to the fact that a portion of the premium on permanent policies is going into the cash value component. By doing some research on different insurance provider companies one can easily find low-cost life insurance rates including both cheap term rates and cheap permanent rates.
Term Life Insurance Policies
Term life insurance is considered to be the most basic form of life insurance coverage. In return for a premium payment, an insurance company will pay out a stated amount of death benefit to a named beneficiary – as long as the policy is in-force when the insured passes away.
As its name implies, term life insurance will remain in-force for a stated amount of time – or “term” – such as 10 years, 20 years, or other set length. Once this term has expired, the policy holder will need to “re-qualify” for coverage at his or her then-current age.
While the initial premium on term life coverage is typically less than a comparable amount of permanent coverage, over time term life insurance premiums can become quite high. This is because policy holders will usually be required to pass through underwriting in order to renew their policies. Therefore, insurance companies also feel comfortable in providing cheap life insurance quotes. More on term life insurance…
Permanent Life Insurance Policies
The permanent life insurance arena contains a variety of different policy types. These include whole life insurance, universal life insurance, and variable life insurance – and they all have very distinctive features and benefits.
Whole Life Insurance
Whole life insurance policies are generally intended to remain in force until the policy “matures” (pays out), or until the owner of the policy cancels or stops paying the premiums that are due. These policies literally can provide life insurance protection throughout the “whole life” of the insured. Whole life is also the simplest form of permanent life insurance coverage.
A whole life insurance policy has both a death benefit and a cash value component, with the cash value portion being further broken down into two separate elements – one where the cash value grows on a pre-determined basis during the life of the policy and another non-guaranteed element that is made up of policy dividends or excess interest.
In most instances, the cash value in a whole life policy can be accessed at any time through policy loans. Paying back these loans is optional; however, any portion of the loan that is not repaid at the time of the insured’s death will decrease the amount of death benefit proceeds that are paid out to the beneficiary. More on whole life insurance…
Affordable term life and affordable whole life, both are available in the market today. You just have to do some research while obtaining quotes and comparing them. Best results are obtained when you compare at least 3 different life insurance quotes and go with the cheapest rates offered by a company.
Universal Life Insurance
Universal life insurance policies have often been described as being similar to a term life policy with a cash value component. With this type of insurance, rather than an insured simply purchasing a term policy and investing additional funds for growth, a portion of the universal life policy’s premium goes towards the insurance death benefit and another portion goes towards a cash account that earns interest as an investment. As with whole life insurance, this cash value component accumulates on a tax deferred basis.
Typically, a universal life insurance policy holder is allowed to change – within certain limits – the death benefit, as well as the timing and the amount of their premium. For example, if the policy holder opts to pay a lower premium within a given time frame, the cash value in the policy will not build as fast, yet the guaranteed life insurance amount will stay in-tact. More on universal life insurance…
Variable Life Insurance
Variable life insurance offers policy holders permanent death benefit protection along with an investment component. With this type of policy, individuals can allocate their funds into various types of underlying investments such as stocks, bonds, or mutual funds.
Doing so can offer the opportunity to grow funds based on favorable market conditions on a tax-deferred basis. It can also, however, mean that there are more market related risks involved. Because of their market exposure, variable life insurance policies are considered to be securities and therefore must be sold with an accompanying prospectus. More on variable life insurance…
How are life insurance premiums determined?
Insurance companies are able to offer the lowest insurance rates if their company expenses (including claims) and agent’s commissions are low and their general fund is performing well.
Life insurance policy premiums are determined based upon what a life insurer must charge in order to provide for company expenses, overhead, profits, and the cost of the insurance company’s anticipated losses. (An insurance company’s anticipated loss is based on the company’s past experience with average risk.)
Life insurance premiums are at historic lows and will only increase moving forward because of economic pressures and because of regulations within the industry to keep higher reserves.
Which type of Life Insurance is Affordable?
If you are young and you are looking for most affordable and cheap life insurance, you should go with term life insurance. It is because its initial premium is low as compared to permanent life insurance.
There is 10, 15, 20, 25 and 30 year term policies. 10 year term is the least expensive and 30 year term is the most expensive. If a 10 year term policy is too expensive, consider an “Annually Renewable Term” (ART) policy.
An ART will be cheaper than a 10 year term, but rates will go up a little bit every year. However, getting coverage now to protect your family and get peace of mind is important today. When rates start getting too expensive, maybe you can lock in a 10 year term at that time and be in a better position financially to be able to afford it.
If you are older and approaching retirement, term life insurance may not be your best choice. Most people buy term to protect their income if there are people that are dependent on them financially. When you hit retirement, a lot of that goes away and your need for coverage isn’t as big.
So take a look at smaller burial insurance policies to cover final expenses. These are typically $5,000 to $25,000 whole life policies guaranteed level for the rest of your life. Smaller payments and guaranteed.
Critical Information To Keep In Mind
Not all life insurance policies are built the same. In other words, cheapest is not always the best.
There are benefits like conversion options that could be poor or non-existant for some term life insurance policies. Term conversions allow you to convert to a permanent life insurance policy with no evidence of insurability. So if you’re nearing the end of your term and you have a severe health concern come up, you can convert your term life insurance into a permanent policy. If there were no conversion options, your term would expire and you’d be left with no coverage.
There are also living benefits associated with some policies where if you get diagnosed with cancer, heart attack or stroke – you have access to your death benefit for anything you need. These benefits come at a price though – you won’t be getting the cheapest life insurance coverage if you opt for a policy with living benefits.
If these extra benefits aren’t important to you, then ignore it. It’s worth mentioning though.
We’re an unbiased source for life insurance rates. Use our instant quote tool and compare rates on the next screen and use that information to make make sure you secure cheap life insurance so you can get that ultimate peace of mind – protecting your family at an unbeatable price.
Best of luck.