14 Tips to help you save money on your life insurance.

14 Ways to save money on your life insurance.
Learn how to get the most from your life insurance premium.

1. Understand your risk factors.  Life Insurance companies assign an underwriting class (premium) by evaluating your risk factors. These factors include age, medical history, family history, height/weight, lab results, tobacco use, avocations, travel and driving records. Most life insurance companies have 4 non-tobacco underwriting classes, 2 tobacco classes and 14 table ratings (each table increases the standard premium by 25%).

2. Many times it will cost less to buy more. Most life insurance companies have price breaks at certain benefit levels - like a volume discount - at $100,000, $250,000 and $1,000,000. It will likely cost less to buy $100,000 than $75,000; to buy $250,000 than $225,000.

3. Pay your premium annually if you can afford to. You will save 4-5% with most companies versus a monthly or quarterly premium payment.

4. The highest financial rating doesn’t necessarily mean better coverage. Focus on companies rate “A” or better by A.M. Best. There is little difference between one company’s term policy and another, so basing a decision solely on ratings won’t always get you the best deal.

5. Take your blood pressure and cholesterol medications. Insurance companies don’t like to see health issues go unattended. They look more favorably if you have taken steps to control these health issues.

6. Life Insurance will never cost less than it does today. Premiums are based in part on your age and you will never be younger than you are today!

7. Back dating your policy to "save age" may save you thousands of dollars over the the term of your policy. Most life insurance companies round up when determining your age (Nearest Age).  Premiums increase as you age so this can make a big difference in your premium. Most companies will allow you to back date a policy up to six months. Premium is due from the date of the policy so do the math to calculate if this makes economic sense for you.

8. Don't Smoke.  Tobacco or nicotine use of any type may have a significant impact on your life insurance premiums – especially as you age.

9. Not all companies view tobacco use the same.

Most companies allow for the occasional celebratory cigar.
A few companies will permit smokeless tobacco or tobacco substitutes at a non-tobacco underwriting class.
Most companies require you to be 100% free of all nicotine for 12 months to received an non-tobacco underwriting class and five years to receive the best class.

10. Your height and weight impact your underwriting class. Each life insurance company has their own height/weight chart to assist in determining an underwriting class - some more generous than others. It is important to know, that if you have lost more than 10 pounds in the last 12 months, the company will add back 1/2 of the weight you lost to determine your current weight for underwriting. Why? Statistics show roughly 90 percent of people who lose a lot of weight eventually regain just about all of it.

11. Work with an Independent Agent! They work for you not the insurance company. They are not pressured to sell one companies product. They are able to find the most favorable company based on your specific medical or family history.

12. Share your complete medical history with your independent agent. An independent agent is your advocate to help you find the best policy. Each life insurance company has their "Sweet Spot". This allows your independent agent to go to the market to find the best company and product based on your specific situation.

13. Read the “Prepare for the Medical Exam” section before completing your exam. Eating foods high in calories and carbohydrates or dealing with a stressful issue before your exam could impact your lab results and cost you money.

14. Buy life insurance on children only after those they depend on for financial support are properly insured.