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Ways To Reduce The Cost of Your Life Insurance Purchase

Updated On Jul 02, 2021

Suppose you have found a suitable life insurance policy with appropriate rider benefits for yourself, but the premium rates are a bit heavy in your pockets. In this case, you can take certain measures which can help reduce the cost of your life insurance policy to fit it into your budget. The following article focuses on such steps which can be taken to reduce premium costs while choosing a life insurance policy.

Tips To Reduce The Cost of Your Life Insurance Purchase

Here are some tips which can be considered to reduce the costs of your life insurance policy. 

1. Purchase the Policy at a Young Age

If you purchase a policy at a young and healthy age, you are likely to get higher coverage at lower premium rates due to low-risk evaluation. So, it is advisable not to procrastinate purchasing the right life insurance policy to get maximum benefits at reduced costs. 

2. Adopt a Healthy Lifestyle

A non-smoker is more likely to get a policy plan at low premium rates than a smoker of the same age, aiming for the same policy benefits. Hence, it is wise to maintain a healthy lifestyle to ensure low premium rates. Moreover, suppose you have a family history of illness like blood pressure, heart ailments, diabetes, etc. In that case, the advice should be strictly followed to reduce any risks, leading to increased premium prices. 

3. Buy the Right Policy Plan

The life insurance policy should be purchased after carefully assessing your personal needs, short-term and long-term goals as different policies provide unique benefits. For instance, ULIPs offer investment opportunities along with life coverage, whereas an endowment plan offers a saving option with a life cover. Thus, it is advisable to read all the terms and conditions of various plans and the utility they will provide in fulfilling your dreams.

4. Necessary Rider Benefits

Rider options like critical illness benefits, waiver of premiums, and accidental death benefits provide additional benefits and make your safety net stronger. However, that does not mean that you should purchase every option available on your policy. It must be noted that more riders equal increased premium amount. Hence, it would be best to buy only the necessary riders that suit your needs and requirements.

5. Suitable Premium Payment Mode

The insurance provider offers different premium payment options like a lump sum, monthly, quarterly, half-yearly and annually to the policyholder. You can choose the most suitable method of payment for yourself so that these instalments do not cause a strain on your budget. However, it is advisable not to select a monthly payment mode as policies are more likely to lapse in this mode due to unpaid instalments. Instead, you can go for a lump-sum or annual payment mode to reduce your premium prices through discounts. 

6. Buy Online

Besides providing a hassle-free and quick process with no involvement of a middleman, online portals and websites also offer tools to help compare between different policies and choose the best one for yourself. Moreover, you can avoid all the paperwork which is otherwise necessary for the offline mode. However, the best advantage of this mode is the discounts offered to the life assured because insurance companies save money on service costs that are not required in an online way. 

Take Away

The tips mentioned above can be followed to purchase a life insurance policy at reduced costs. You can even consult a financial advisor or an insurance agent to reduce premium rates on customized plans for yourself, your spouse and your children.

Also Read:

Most Common Reasons for Rejection of Life Insurance Claims

Why is Claim Settlement Ratio Important While Buying Life insurance?

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.

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