How to Get Cheap Life Insurance

Life insurance is that insurance that we desperately hope we’ll never need to use—or at least that our loved ones won’t need to use.

But in so many respects, it can be the most important type of insurance that you have.

It’s your way to provide for your dependents if you aren’t around to do it for them.

OK, you want to help protect and provide for your family but life insurance can be expensive.  How can you get cheap life insurance?

Below are some ideas on how to get cheap life insurance.

Buy Term Life Insurance

Insurance companies often load insurance policies with various provisions, especially investment features.

Whole life, universal life, and other policies are really mostly investment accounts with a life insurance feature.  Worse, they’re even far from being the best investment accounts to have.

If you’re insurance includes investments, your premiums will be much higher than if you buy a simple term life insurance policy.  Term is pure life insurance, and you hold it for a very specific period of time, usually, five, ten or fifteen years.

Because of this time limit and the missing investment provision, term insurance is also much less expensive than other forms of life insurance.

This can be especially important if you have a young family and limited funds to pay for life insurance.  At this point, your need for life insurance is greater than ever.  The only way to get the level of coverage you need will be to use a term policy.

Premiums for term insurance are typically a fraction of what they are for an equivalent amount of whole life insurance.  No, you won’t have cash values to borrow against, but you’ll have pure insurance coverage to benefit your loved ones in the event of your death, and that’s all you need.

If you want to invest money, you should do it outside of your insurance plan.

You can keep your term policy for the coverage it provides, and invest your money in index mutual funds or ETF’s.  You’ll do better that way, both on the insurance side and with your investment returns.

Buy when you’re young and and when you’re healthy

how to get cheap life insuranceWhile this isn’t something that’s entirely in your control, buying insurance when you’re young and healthy can save you a lot of money.

When insurance companies provide life insurance they’re doing so on the premise that nothing will happen to you any time soon.  If you have health issues, they can either raise your premiums, or even deny you coverage entirely.

Age can be an even bigger factor.

Premiums for life insurance rise substantially as you get older, and especially once you enter middle age.  Buy your policy as early in your life as possible that way you lock in the premium at an optimal time in your life.

Just like age your life insurance rates will go up as your health deteriorates.  It’s important to do what you can to improve your health before a life insurance exam (usually a blood test).  As your cholesterol goes up so will your insurance premiums.  You can’t fix big problems overnight but you can easily do things like watch the carbs, alcohol, and ice cream a week or so before your test.

Your health is another argument to get life insurance at an early age.  As you get older it’s tougher to keep those extra pounds off and that will cost you.

Bundle with other insurance policies

The first place you should begin shopping for life insurance is with companies you currently do business with.  Often, they can offer you a reduced rate based on other policies they have with you.

Get quotes from the company (or companies) that provide your auto or homeowners insurance.  If you’re self-employed, check with the company that you have your business insurance with.  The company may provide you with an extra cheap policy as a way of retaining your business.

Alternatively, you could get quotes from insurance companies that you don’t do business with, then send copies of their quotes to your current providers.  Anxious to keep your business, they may give you a preferential rate on your life insurance.

Also look at any affiliations you have that offer life insurance.  Some examples are AAA and AARP.  There may also be trade associations you’re affiliated with that offer preferential rates for members.

Live a clean, safe life

Life insurance companies don’t just look at your health history in determining your premiums.  They also look at records that can indicate behavior as well.

Dangerous behaviors can lead to an early grave, and the last thing any insurance company wants to do is pay out a claim!

Your driving record is one indication.  If you show a pattern of aggressive behaviors in driving, it will have an effect on your premiums.  It probably won’t help you find cheap insurance if you’ve recently come off a run of multiple driving citations.  Slow down, obey traffic laws and you’ll pay lower premiums.

Shop and compare!

After you’ve done all that you can to find the cheapest life insurance rates through sources you know, it’s time to do some more shopping!

Check out as many life insurance companies as you can and compare what they have to offer.  Competition works to lower prices, and that’s true of life insurance too.


Don’t let life insurance rates keep you from getting the insurance you need to protect and provide for your family.  It’s not the most sexy use of your money but the earlier you get life insurance the cheaper it will be.  Add in a few of the tips above and you may find that your life insurance wasn’t too expensive at all.

What sources have you found that offer the cheapest life insurance?

Are you looking for life insurance?  Get a free quote from USAA now.

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Published or updated November 21, 2013.


  1. QualityTermLife says:

    You cannot legally be given a discount on life insurance – bundled or not. However, the recommendation to shop around and compare can save you money – upwards of 80%.

    Many online companies offer rate quote comparisons from major insurers. The QualityTermLife website is a one of the best – because it lets you compare life insurance rates from nearly 100 of the best insurance companies.

  2. Our life insurance is very reasonable. We got it early on, and we are both healthy. I’m preaching to the choir, but it is so important to have. You never know how long you have with your loved ones, and it feels good to know they will be taken care of if the worst happens. The last thing your family needs if you pass away is to be wondering how they will pay the bills.

  3. I know most finance experts say that term life insurance is the way to go (and I agree), but what do you think about a combination of term and whole life? I haven’t heard too much about using the two together and if there are any benefits/cons.

What Do You Think?