Not everybody needs life insurance. However, if you have a partner or children who are relying on your income to provide for them, or your salary is needed to pay a mortgage, then taking out a life insurance policy can be worthwhile. Taking out a life insurance policy means that you can be assured that everything will be taken care of when you are gone, but only if the premiums don’t make it unaffordable!
Life insurance premiums are usually calculated based on your age, overall health, and lifestyle, but there are things that you can do to bring them down and make insurance affordable.
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Consider how much coverage you actually need
To ascertain how much life insurance you need and how long you need it for, you should consider the reasons that you are taking out life insurance in the first place. You might take out a life insurance policy to:
- Cover your mortgage and other debts
- Cover any inheritance tax that may be charged on your assets
- Provide an income for your dependents
- Cover funeral expenses
Think about which of these apply to you. If you are primarily looking to cover your mortgage, then you only need a policy that covers the remaining term of your mortgage. You can also decrease your life insurance as the outstanding amount on your mortgage decreases, which will mean lower premiums.
In the UK, inheritance tax will be charged at 40% on any inherited amount of over £325,000. It may be worthwhile accounting for this in your life insurance policy, especially if you are leaving behind property, which you don’t want to have to be sold.
Shop around
As with any insurance policy, it’s worth shopping around to make sure that you get the best deal for your circumstances.
For people who have found life insurance expensive or difficult to obtain due to a long term health condition, there are solutions. For example, some companies will provide reasonably priced cover for people with HIV and mental health issues.
Compare Joint and Single Policies
If you have a partner, it is a good idea to consider what will happen if they pass away before you do, as well as what happens if you go first.
To ensure that you are both covered, it can be worth getting a joint life insurance policy, but be sure that you compare the cost of a joint policy with the cost of two single policies to ensure that you are getting the best deal.
Improve your health
One of the significant factors for any health insurance policy is your overall health and lifestyle, so you can bring your costs down by making improvements in these areas. If you smoke or are overweight in particular, this will increase your premiums.
Losing weight and quitting smoking aren’t easy to do. Exploring support options can give you a higher chance of success, for example asking your doctor for resources or joining a support group. If losing weight is your goal, then meal planning is essential, but it can be challenging to know where to start! Savoo is currently offering a muscle food discount code that you can use to try out their meal planning service at a much lower cost than usual, which could be a great way to get you started on your weight loss journey.
Check your employee benefits
A lot of employers offer health insurance plans to their staff, so it’s worth checking to see if this is something that is included within your employee benefits before shelling out yourself! Just be aware that any employee cover is likely to end if your employment does, so you will need to bear this in mind if you change jobs.