CAA Saskatchewan Fall 2016 | Page 53

Easy ways to save on life insurance
Coverage doesn’t have to be expensive. Here are some budget-friendly ideas.
Life insurance can provide your family with a financial
resource in the event that you are no longer there to
provide for them. If you have people who count on you,
they don’t have to be deprived of financial protection.
After all, there are very real ways to get enough
coverage without breaking the bank. Here are
some of them.

Join a group
Most things are cheaper by the dozen. That’s why buying life
insurance through a group practically always costs less than
buying it directly on your own. It tends to be less expensive
because the insurance company is calculating the overall
risk of the group. The chance of everyone at an association
or company dying simultaneously is so small that the cost of
insuring a group is cheaper than insuring a person.* Check
out retail groups like CAA for member benefits that include
insurance options.

Choose term
Term insurance is popular for a good reason: because it is
purely a life policy — it provides death benefit protection for
a specified period of time (or ‘term’) — and its premiums are
usually lower than permanent life insurance, allowing you to
buy more coverage. Though it does not build cash-value like
universal or whole life, term insurance is an economical option
for people looking strictly for income replacement in the event
of death. Term insurance is also a more affordable and more
flexible option than mortgage insurance.

Buy early
The younger you are when you buy life insurance, the lower
your premiums will be. That’s why getting covered early, or as
soon as you go through a life event, can be to your advantage.
Life events are those pivotal life changes when your financial
responsibilities increase – for example, when you get married,
have a child, a growing family or aging parents, buy a home,
and so on. It is during these times when having life insurance
makes most sense, and delaying purchase will only make it
more costly to buy as you get older.

Buy in bulk
It’s the same concept used by wholesale stores. The more
you buy, the more you save. So ask about volume discounts
for higher coverage amounts. If you’re going to buy $200,000

of coverage, you might as well buy $250,000. For example, a
40-year-old male nonsmoker with $200,000 of 20-year term
insurance pays $42 a month. For $250,000, the rate drops to
$39 with a volume discount of 25%.

Improve your health
The healthier you are, the more likely you’ll outlive your policy.
Therefore, there’s less risk to the insurance company. It’s as
simple as that. So take steps to improve your health now. If
you’re a smoker, quit. Lower your blood pressure. Control your
blood sugar. It helps to buy life insurance while you are healthy.
If you buy life insurance after you have developed a serious
health problem, your life insurance premiums are likely to
be higher.

Pay annually
Even a simple matter like how often you pay your premiums
can save you money. Some insurers give a premium discount if
you pay annually rather than monthly. That’s because the fewer
payments you make over the course of the year, the less you’ll
pay overall.

Make it renewable and convertible
Many term policies give you the option to renew your coverage
at the end of the term without another medical exam. This can
be to your advantage. The convertible option means you can
convert your term policy to a permanent life policy – also without
a medical exam at the time of conversion.

Avoid commissions
Eliminate the middleman and the savings get passed on to
you. Buy directly from insurance companies that sell policies
with fewer costs built into them, such as agent commissions.
Because they sell without an agent, there is less cost to them
and more savings for you (especially if you don’t need much
handholding to make a decision).
In conclusion, it´s important to balance the desire to keep
premiums low with buying coverage that can be enough
to meet the needs of your family in the event of your death.
Consider how the loss of your income could affect your
family´s financial situation and make your decision about the
coverage amount you need based on that information.

See how you can save on premium rates with CAA Term Life
Insurance. To learn more and get a no-obligation quote, visit
caalife.ca/learnTL. Or call 1-866-923-4084.

Underwritten by

The Manufacturers Life Insurance Company.
® CAA and CAA logo trademarks owned by, and use is authorized by, the Canadian Automobile Association.
Manulife and the Block Design are trademarks of The Manufacturers Life Insurance Company and are used
by it, and by its affiliates under licence. © 2016 The Manufacturers Life Insurance Company (Manulife).
All rights reserved. Manulife, P.O. Box 670, Stn Waterloo, Waterloo, ON N2J 4B8.
*Investopedia, “Group Life Insurance – Group Life Insurance: Common features”