Buy when you’re young.
Many people may feel they don’t need life insurance when they are young. While your financial needs may be lower at a younger age, the rates are also substantially cheaper when you’re young. Remember, the goal is to cover your primary assets (like your salary and house) so that if something were to happen to you, your beneficiaries would be able to persevere financially. The best advice is to lock in as much protection at a young age while your health and prices are still good.

Buy before any major health issues arise.
Healthy people have the best mortality risks and thus are much cheaper for companies to insure. This translates into lower rates for the “Super Preferred” customer than someone with higher risk factors such as a heart condition, cancer or diabetes. Conversely, if you were unhealthy when you acquired your policy, and your health has now improved, it might be time to shop for a new policy, as your rates are likely to be lower.

Buy the right amount of coverage.
Many agents may try to sell you more coverage than you need. The purpose of life insurance is to “indemnify” (replace financial loss), and what most people should be looking for is income replacement for their beneficiaries. Independent financial planners recommend the following rule of thumb: purchase an amount of coverage equal to 6-10 times your annual gross income.

The right hobby with the wrong company could cost you.
People who participate in high-risk sports or activities such as hang-gliding, skydiving, mountain climbing, scuba diving, and racing could very well pay more money if they don’t pick the right company. Every company looks at risk factors differently and some are more liberal in certain areas than others.

Work policies aren’t always the best deal.
While purchasing a life insurance policy through your employer is convenient, it may not be the best deal available to you. Work policies are often based on a composite profile of the employees you work with, many of whom may be less healthy than you, or have other underwriting factors that might drive up rates. These types of policies also expire when you leave the company. Inexpensive term life insurance polices that cover your dependents until they can live comfortably on their own are often a better alternative.

Check out your payment/billing options.
Many life insurance companies offer discounts to consumers who pay their premiums annually, or who pay monthly by electronic funds transfer (EFT).

Review your policy often.
Do a review of your life insurance policy a minimum of every three years, if not more often. Rates may be lower, and your circumstances may have changed, necessitating more or less protection. If you are replacing a policy, make sure you allow enough time to get your new policy in place so coverages won’t overlap or lapse.

Don’t overspend on protection.
Term life insurance is the most affordable and cost-effective pure protection available, and it is typically much less expensive than a comparable whole life policy. The old axiom still rings true: “Buy Term and invest the difference.”