How to Lower your Premiums for Term Life Insurance?

Sep 19, 2019 | 1 month ago | Read Time: 3 minutes | By iKnowledge Team
How to Lower your Premiums for Term Life Insurance?

A Life Insurance Term Plan is an insurance plan that protects your family from financial instability during unfortunate events like death or permanent disability of the policyholder. Several insurance companies offer term plans for a definite period of time. For example, a typical term plan provides life cover up to the age of 80 years.

In the event of the death of the policyholder, the company pays a pre-decided lumpsum amount to the insured’s family. The pay-out ensures that the family faces no financial hardship in the absence of the family’s breadwinner.

If you have bought a term insurance, you will have to pay a monthly amount, known as the premium. The premium amount, set by Insurance companies, depends on policy features. Greater the features and coverage, higher is the premium amount.

Premium rates also differ for individuals depending on their health status, habits and lifestyle. What if we told you that you have a say in the premium rate charged by an insurance company? Here, we discuss some of the factors that affect premium rates and how you can influence the monthly amount you pay.

1.    Healthy Lifestyle and Good Habits:

If you are someone who takes care of your health and has led a healthy lifestyle, chances are your premiums will be lower. Since health status determines term insurance premium rates, most insurance companies ask for medical information of the applicant. It is possible that an individual suffers from pre-existing conditions such as high blood pressure or diabetes. These factors may lead to an early death when compared to healthy individuals.

These factors are applicable to all individuals alike. So, stay healthy and pay lower premiums.

2.    Drinking Habit or Tobacco Addiction:

If you are a heavy drinker and/or smoke regularly, you must disclose this information while buying a life insurance term plan. It is a well-known fact that drinking and smoking have an adverse effect on health. These are one of the major causes of serious ailments that affect many individuals.

A way to curb premium rates is to avoid such unhealthy habits. Besides lowering your term insurance premium, good habits also prolong your life.

3.    Policy Tenure and Features:

When you apply for a term insurance plan, you get several options for policy tenure. The tenure is the period for which you will get a term cover. The premium for a 20-year cover will be higher as compared to a 10-year policy. This is because the company offers a life cover for a longer period.

Similarly, if you opt for a higher sum assured, premiums will be higher. The sum assured is the amount paid by the company upon the policy holder’s death. Hence, a higher cover sum attracts higher premiums. You can choose to adjust one of the factors to lower the term insurance premium rate. However, you should keep in mind that you adjust either of these features given the needs and requirements of your family.

4.    Buying Term Insurance Online:

There are several companies that offer online life insurance term plan on their websites. Generally, online term insurance policies attract lower premiums. There could be many reasons for this.

Individuals tend to buy policies offline, through an agent. In such an event, companies must pay the required commission to agents, which is an expense for companies. Also, purchase of online policies helps in saving administrative costs. Hence, you get to reap the benefits of buying online term insurance in the form of lower premium rates. If you are looking for term Insurance, visit our website for some of the best term and life insurance policies.


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