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5 ways to save on your life insurance in 2022


Life insurance can be a daunting and complex subject. What’s more, many people would prefer not to contemplate something bad happening to them.

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For this and other reasons, people – especially young people – often put off buying life insurance. But it is an important part of any long-term financial plan.

Once you decide to buy life insurance, you’ll want to look at how you can save money. There are a lot of options for life insurance in Canada – different insurers as well as different types of plans. The cost depends on many factors too, like how old you are, what type of coverage you want, and whether you would like to build in some sort of investment component that allows you to save money while you pay premiums.

Below are 5 important ways you can save money when buying life insurance.

Go with an online life insurance provider

There are 3 big insurance companies in Canada: Canada Life, Manulife and Sun Life. These and other insurers of a slightly smaller scale often sell insurance directly to consumers through a network of advisors who work on commission. Then there are also smaller firms who in partnership with larger insurance brands are building modern and convenient ways for consumers to buy insurance. An example of this is Toronto-based insurer PolicyMe. Online insurers tend to offer more affordable prices and have a more straightforward application process. That said, there may not be as many options to bundle in other types of insurance as there are with bigger players. PolicyMe says its premiums cost 5% less on average than its competitors.

Larger insurers commonly have a long application process for buying life insurance. You speak with an advisor, answer a series of questions to figure out whether you qualify for insurance and then meet with a nurse for a medical assessment. With PolicyMe, the application process is entirely online and takes only 20 minutes. You’ll find out if you’re approved right away. A bonus is their agents are non-commissioned so you know you’re getting honest advice.

Apply sooner rather than later

There is a general rule when applying for life insurance: the older you are, the more expensive it gets. This is because you are at a higher risk for various health issues. If you have existing health problems, you will almost certainly pay higher premiums than someone who is otherwise healthy. In fact, you may be denied coverage altogether. That’s why the younger you are when you buy life insurance, the more you’ll save in the long run. If you apply for life insurance, say, in your twenties, you can lock in a cheaper policy with lower premiums throughout your life. And this is the case even if you become sick later on.

Be healthy and don’t smoke

A sure-fire way to save on life insurance would be to stop smoking, if you currently do so. Insurers of all stripes often ask fairly early in the application process whether or not you smoke. It’s considered a risky habit that increases your chances of various health issues, none of them good. Insurers often also ask how much alcohol you consume and whether or not you use recreational drugs.

Even if you don’t plan on buying life insurance, the importance of a healthy lifestyle hardly needs reminding. Maintaining an appropriate weight, eating a balanced diet, and getting enough exercise are all important in their own right. But doing these things will also probably help you save on life insurance too. As proof, some insurers around the world are incorporating wearables like smartwatches or wristbands into their policies.[1] For example, if you complete certain exercise goals, you can receive discounts on your premiums.

Shop around and do research

It’s important to review your financial needs before you buy life insurance to make sure the coverage applies to your financial situation. For example, term life insurance typically covers you for a predetermined period of time, and even if you make it to the end of that period in good shape, you don’t receive any of your premiums back. Permanent life insurance, in contrast, allows you to incorporate an investment plan into your premiums. This means that you build up savings as you make payments. For this reason, permanent life insurance is often 4x to 5x more expensive than term life. In most cases, a term life insurance policy offers better support to most families. Instead of paying the higher fees that come with permanent life insurance, you can take the difference and invest it yourself.

There are also websites that allow you to enter your personal information and compare quotes instantly from different providers. Be warned, though, as these sites do collect that personal information and often pass it on to insurance brokers who may follow up and contact you.

Bundle policies and save money

Some insurers will offer discounts if you bundle other types of insurance with your life insurance. For example, you might be able to save by buying house or auto insurance from the same provider.

PolicyMe, for example, offers life insurance for couples at a reduced cost. It also offers Child Coverage for free with its policies. This means your children are covered by your policy as well.

Bottom line

Life insurance is an important part of any long-term plan. By taking certain steps when choosing a life insurance provider—for example, buying life insurance while you’re young, shopping around for the best prices, and maintaining a healthy lifestyle—you can save a considerable amount of money.

Lead image: Getty

Name Product Types of Insurance Coverage Range Issue Ages Medical Exam Required Province Availability
PolicyMe Life Insurance
Term Life, Critical Illness
$100,000 - $5,000,000
18 - 75
Get fast and affordable term life insurance. Personalize your policy details and get an estimate price within seconds. No phone call, meeting or paperwork required. Get an instant decision.

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