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How to get cheap life insurance in 2021

Find a cheap life insurance policy without skimping on coverage.

Life insurance is customized to the individual, so no two policies are the same. While some factors are out of your control, like your age, there are a few things you can do to minimize the cost of your life insurance.

What is the cheapest life insurance for my age and gender?

Because the cost of life insurance will vary for every individual – based on things like age, gender, family health history, occupation, lifestyle and other factors – there is no “cheapest” life insurance policy on the market. Still, to help you get an idea of how cheap life insurance can be at different stages of life, we’ve rounded up a range of life insurance quotes at various ages for both men and women.* All of these quotes are for a $500,000, 20-year term life policy.

11 tips for getting cheap life insurance

There are many tips and tricks you can use to lock in the cheapest life insurance for your needs and situation. Try following these 11 tips.

1. Choose term life insurance

It’s the simplest and cheapest type of life insurance. Term life insurance provides protection for a set period of time — like 10 years, 15 years, 20 years or 30 years – or to a set age, like 65 years old. In some cases, the premium stays the same for the life of the policy, so you know exactly how much you’ll pay each month.

The best term length for you covers your biggest financial obligation, like a mortgage, car loan, your kids’ college costs or the time between now and your retirement. You should only purchase as much coverage as you need. The lower the term length, the lower the premiums will be. A 5- or 10-year term is going to be more budget-friendly than a 30-year term.

2. Check each company’s financial ratings

Even when it’s cheap, life insurance is still an investment, so you want to make sure your insurer has the cash reserves to pay out claims when you die. To find out how financially stable each provider is, check its DBRS or Standard & Poor (S&P) ratings. These agencies assess the financial strength of insurance companies and assign a rating. Ideally, your insurer should score an A (Excellent) or A+ (Superior).

3. Buy now

The younger and healthier you are, the cheaper your rate will likely be. So if you’ve determined a need for life insurance, lock down a low premium by purchasing a policy as soon as possible.

The reason for this is simple. When they’re crunching the numbers, life insurance underwriters look at your life expectancy based on your profile right now. As we age, our health deteriorates and our likelihood of dying increases. So applying early — while your life expectancy is high and before those health problems set in — means you’ll be able to access a better rate.

4. Bundle your insurance coverage

Do you need other kinds of coverage? You may be able to cut the cost of your premium by bundling your life insurance with your auto, home or umbrella insurance. When you’re comparing insurers, ask about whether you can earn a discount by combining your policies.

This strategy works best if you’re purchasing or reviewing all of your insurance at the same time. That way, you’ll have leverage with companies who are competing for your business.

5. Get a medical exam policy

Sure, it’s time-consuming, but it’s worth applying for a policy that requires a medical exam. No-exam policies, like guaranteed issue and simplified issue, are convenient if you need coverage fast, but they often cost much times more than underwritten policies.

There’s a logical reason for this. Since without a medical exam, insurance companies can’t get a complete idea of your health and medical history, you’re riskier to insure. To compensate for that risk, insurers err on the side of caution and charge a higher premium.

6. Quit smoking

Smokers have a lower life expectancy, and smoking has been proven to increase the chance of developing other health conditions, like lung cancer. Insurance companies classify you as a non-tobacco user if you haven’t smoked within a specified amount of time, usually within 1 to 2 years. Once you’re deemed a nonsmoker, you may be eligible for preferred rates.

If you’re not interested in giving up smoking, your best bet is to apply with companies that are known to be lenient with tobacco users.

7. Work through your health issues

On the same note, do anything you can to improve your health. Underwriters assess all aspects of your well-being, even your weight. If you’re overweight or have high blood pressure or cholesterol levels, you’re likely to be penalized with a higher rate.

The goal is to make sure your insurer has the most positive version of your health profile. To achieve this, it’s a good idea to see your doctor before applying for life insurance. That way, it gives you a chance to take care of any underlying health issues. It also ensures that your insurance company gets your latest medical records and no surprises pop up in the medical exam. If you can prove that you’ve made progress between your last doctor’s visit and your medical exam, that could work in your favor.

8. Say no to riders

For the cheapest rate, stick with basic coverage and don’t dress up your policy with riders unless you really need them.

Riders are optional extras that can be added to your policy for a fee. For example, you can opt into a return of premiums rider, spousal coverage or a critical illness rider. While riders add more layers of protection, they also increase premiums — sometimes drastically.

9. Pay your premiums annually

When you buy life insurance, you may have the option to pay your premiums monthly, quarterly, semiannually or annually. If you can pay up front, you could receive a discount from some insurers. Check with your insurer to see if they offer any such benefits.

As you’re comparing providers, also ask about their discount programs. You may find you’re privy to other discounts too.

10. Buy more coverage

Life insurance is priced at a cost per thousand. The rates per thousand decrease once you reach the $100,000 mark. Think of it as buying in bulk. For example, purchasing one $200,000 policy is cheaper than buying two $100,000 policies.

If you’re tossing up between two similar coverage amounts, you may be able to save money over the long haul by buying more coverage.

11. Clean up your driving record

Good drivers are usually eligible for the best rates. Depending on the provider, to be classified as a safe driver, your driving record must be free of DUIs, accidents and major traffic violations in the past 3 to 5 years.

To get cheap life insurance, pay any outstanding parking tickets and avoid speeding and reckless driving. Bonus: This will look good on your car insurance application, too.

Get quotes from life insurance providers

Like all major purchases, it pays to shop around for life insurance. Insurers calculate risk in their own way, and they weigh factors like your health, driving record and occupation differently. For example, some insurers pull up your 5-year driving record; others only care about the last 3 years. Some insurers might penalize you for having a family history of heart disease, cancer and diabetes, while others only emphasize heart conditions.

To save money, compare insurers. Even if the cheapest premiums differ by a few dollars a month, that adds up over the life of the policy.

Check out some life insurance options in the table below to help get you started:

Name Product Types of Insurance Coverage Range Issue Ages Medical Exam Required Province Availability
PolicyMe Life Insurance
Term Life
$100,000 - $10,000,000
18 - 75 years old
No
Alberta, British Columbia, Manitoba, Nova Scotia, Ontario and Prince Edward Island
Get fast and affordable term life insurance without the need for a medical exam with PolicyMe.
TermLite Term Life Insurance
Term Life
$10,000 - $1,000,000
18 - 80 years old
No
All of Canada
Get fast and easy-to-understand term life insurance with no medical exam and no paperwork required.
Sun Life Go Term Life Insurance
Term Life
$100,000 - $1,000,000
18 - 69 years old
No
All of Canada
Sun Life Go Term Life Insurance is a standard term life insurance option that guarantees your premiums in the first 10 or 20 years of your policy.
RBC Life Insurance
Term Life
$50,000 - $25,000,000
18 - 75 years old
No
Ontario, Alberta and Manitoba
Select from two unique RBC term life insurance plans to get flexible and affordable coverage that suits your lifestyle and budget. Get a free quote through PolicyAdvisor.
PolicyAdvisor
Whole Life, Term Life, Universal, No Medical
$25,000 - $5,000,000
18 - 75 years old
No
Alberta, Manitoba, Ontario
PolicyAdvisor is a digital life insurance brokerage that has partnerships with 20 insurers in Canada.
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Compare up to 4 providers

Is term or whole life insurance cheaper?

Term is almost always cheaper. The reason isn’t subtle: Term offers protection for a set time, so there’s a good chance you’ll still be alive when your policy expires. That means there’s less chance of your insurer having to cough up money.

On the other hand, whole life is a type of permanent policy. It lasts a lifetime. Everyone dies, so your insurer knows it’s going to have to pay our your death benefit at some point.

Whole life also has an investment component, where a portion of your premium is invested in the market to increase your policy’s cash value. Once you’ve accumulated enough cash value, you can borrow against your policy and use it to pay your premiums. These factors help to increase the overall cost of whole life, too.

Why is life insurance more expensive for males and smokers?

It comes down to life expectancy. Males and smokers have a higher risk of dying than their female and nonsmoking counterparts. In turn, insurers have to assume more risk — so they protect themselves, and their bottom line, by charging a higher premium.

Let’s look at the average life expectancy in Canada. As of 2018, a man can expect to live until age 79.9, while a woman is likely to live until age 84.1. Of course, these are averages, but it is the sort of data that insurance companies use to determine their rates.

As for smoking, it’s proven to increase the occurrence of certain health issues, like cancer. It’s also linked to poor habits, such as an unhealthy diet or a sedentary lifestyle — all factors that can affect your life expectancy.

Bottom line

Ideally, your life insurance policy should be affordable and offer the coverage you need. If you’re looking for the cheapest life insurance, there are a few ways to cut down the cost, like choosing term life over permanent policies, buying sooner rather than later and steering clear of riders that hike up the price.

When you’re hunting for cheap life insurance, compare providers and their discount programs to make sure you’re getting the most value for your money.

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