5 Ways to Reduce Your Insurance Premiums
- Clement Chung
- Feb 12, 2017
- 2 min read
Whether you have Life Insurance, Critical Illness Insurance or Disability Insurance, I have listed the 5 main ways that you could look at in reducing the cost of these policies!
Before I start, I want to say that insurance should always be seen as the foundation of your financial empire — the tricky part is to not overpay for it!
1. Eliminate Useless Insurance Riders: These include things like Guaranteed Insurability Option, Accidental Death & Dismemberment, Total Disability Waiver Riders, etc. These additional features could cost you an additional $200 a year — the worst part is that in training school, they call these features pure profit. It’s like selling warranty on the toys that you purchase — the money is spent but it is very unlikely that you will actually use it!
2. Renew Your Policy: As a result of advances in medical research and technology, human life expectancy has increased dramatically over the past 10 years — meaning that you are far less likely to die or fall critically ill today than you would 10 years ago. This resulted in a dramatic reduction in the cost of insurance and thus, if you purchased your life insurance 10–20 years ago, you may be able to renew your insurance policy at a lower rate, even if you have aged a bit!
3. Cancel Your Mortgage Insurance: If you are paying for mortgage insurance, then consider purchasing an individual policy. Premiums are likely to be cheaper for insurance coverage that stays the same and is guaranteed to payout upon accepting the policy.
4. Reduce Your Coverage: Typically as you get older, your need for insurance will incrementally decrease — a quick review of your insurance needs and current coverage would reveal that you probably don’t need as much insurance as you did 5 years ago, so go ahead and reduce that coverage and save yourself a couple of dollars!
5. Prove a Healthy Lifestyle: Some companies allow you to prove that you are living an active and healthy lifestyle and in return, they will give you discounts on your insurance premiums. Manulife’s Vitality Program allows this along with Pacific Blue Cross.
Insurance is kind of like the elephant in the room — it is that non-sexy part of your life that no one wants to talk about. That being said, it is true however that insurance is the foundation upon which you will build your empire upon because in all honesty, you can’t build a financial empire without protecting the tools that you build it with.
Discipline is what it takes to block out the noise, commitment is what it takes to walk the path to financial success and patience is what it takes to reach the goal.