Affordable Life Insurance Tips

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Life Insurance Premiums

Life insurance premiums can be paid quarterly, annually, semi-annually or monthly. Generally, it is best to pay the premium annually in order to avoid additional processing fees. Should you miss a payment, you policy may lapse which could result in your coverage being permanently revoked.


Affordable Life Insurance Option: Group Life Insurance

Employer-provided life insurance coverage is often the most affordable form of life insurance available. This is because the insurance is underwritten based on the group's risk, rather than yours as an individual. Your individual health will not be considered, since the underwriters use other criteria to determine risk when underwriting group life insurance. If your employer doesn't provide a life insurance benefit, find out if any of the organizations or unions you are a member of offer group life insurance to their members. Organizations like AARP, AAA, trade and talent unions often offer group life insurance to their members at a fraction of the cost of individual insurance.

*It is important to remember that your benefits may be contingent upon your membership or employment.


Fraud and Life Insurance

It is estimated that there is approximately $1.5 billion in fraudulent activity within the life/disability insurance sector annually. There are two types of fraud, internal and external. Internal fraud is from within the industry and external fraud comes from policy holders, third party claimants and applicants. Insurance fraud is a penalty punishable by prison time and substantial financial penalties. Life insurance fraud raises the rates of coverage for the insured, which can make affordable life insurance not-so affordable for the honest policy holder.


Determining Life Insurance Needs

Estimating the amount of the life insurance policy you need can be tricky, and often complicated. There are few immediate questions you can ask yourself in determining your life insurance needs: How much money will your family need after you are gone? How much money will be needed to cover immediate expenses for medical costs, funeral expenses and lingering debt? And how much money will your family require to maintain their standard of living over time? Most life insurance companies provide a calculator or formula to help determine the optimal amount of affordable life insurance that will be needed. Factors such as future needs, existing finances and your current health will determine the amount of the monthly investment to protect your family in the event that you are no longer around.


Health Factors with Life Insurance

Your current health, lifestyle and environment all help determine the costs of affordable life insurance.

Smokers, those with heart conditions and people with various illnesses like diabetes or asthma pay higher premiums and coverage for life insurance.


Life Insurance for Women

For many years, the target demographic for life insurance companies was middle-aged men who earned the majority of the money for their familes. In recent years, women have emerged as equals in the workforce, but do not carry the amount of life insurance as men.

As women make their way up the corporate ladder, many husbands are staying home with the kids and playing the Mr. Mom role. In some cases, the households are dual-income and can obtain two different life insurance policies. It's beneficial for the family together to look at their insurance policies, and decide on a suitable plan.

- If the woman is the breadwinner in the family, would a man be able to keep up the house and the children's lifestyle if the wife dies?
- If a woman is single, who would shoulder the burden upon her death?

Women need affordable life insurance the same as men to ensure that the survivors are taken care of properly.


Term Life Insurance

Term life insurance is the most basic type of life insurance and provides coverage over a certain period of time. In contrast to permanent life insurance, term insurance which does not expire, term life insurance offers lower initial costs. When you purchase term life insurance for a period of time (usually five, 10 or 25 years) you are essentially paying for the death benefit that your beneficiaries will receive.

Permanent policies fund death benefits but can also accumulate cash value. Term life is a more affordable life insurance and is a better option for people on a tight budget. You can buy high levels of protection based on your needs, but remember that your term policy will expire at the end of your purchased term. If you still require coverage you will have to renew the policy or take out another one.


Golden Years

Seniors need to carry life insurance for a variety of reasons. Beneficiary settlement costs in the case of death is one consideration for seniors. Medical costs can add up and become pricey, and the burden of funeral and burial costs should not fall upon loved ones. A life insurance policy can also help with estate taxes.

An affordable life insurance policy can help cover medical, funeral and estate costs, and give benefactors and survivors added comfort in their living arrangements. Because the average life expectancy is growing, actuary tables are being adjusted allowing low cost life insurance to be available to those in their golden years.


Money Savings Ideas with Life Insurance

While coupons and super-savers help out in an ever-cost-cutting world, you don't want to skimp out on your life insurance. If you can't afford to spend a lot on life insurance, here are a few tips to help save money with a cheap life insurance policy:

- Buy as early as possible. The younger the better on getting good rates.

- Select the proper length of coverage when buy term insurance. Discuss the rate and time period with your agent.

- Hazardous jobs and pastimes can affect your insurance rates. High risk jobs and dangerous hobbies can raise your premiums.

- Review all of your billing options. Certain billing alternatives such as paying monthly or yearly can help lower your payments.

- Review your policy often to make sure there are no new products or lower cost insurance options available for the same benefits.

Who Needs Life Insurance?

Who Needs Life Insurance?

Whether or not to purchase life insurance is a personal decision that one makes depending on health, career and financial stability. Ask yourself the following questions if you're considering a life insurance option. If you answer "yes" to any of these, you should look into purchasing a life insurance policy:
Does someone depend on you financially?
If you died, how would your loved ones get along without you financially?
Could they pay for final expenses such as medical bills, debts and funeral costs?
Would they be able to maintain living expenses?

There are many low cost life insurance options available to ensure your loved ones are adequately provided for in the event you can't provide for them.


Lacking Proper Coverage

The percentage of people with life insurance has declined over the past few decades. It is estimated that nearly 40 percent of American adults do not hold any life insurance coverage. Those who do own a life insurance policy often find they do not own enough life insurance coverage.

It's a good idea to talk with your employer, your financial planner or a life insurance agent about the various life insurance options available.

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Christina Chan