Updated August 27, 2018: Protective Life Corporation lowered its life insurance rates this week, continuing a year-long trend of price drops. AIG, Banner Life, Lincoln Financial, Pacific Life and Mutual of Omaha also lowered rates this year — and term life insurance rates are currently at a 20-year-low.
Why are rates dropping? People are living longer. Insurers are paying less to operate (thanks, technology!) and state regulators have lowered the amount of cash carriers needs on hand.
But you can't really sit on this trend. Or hope for a better sale. To get the best life insurance rates, you should, simply put, apply now. Yes, we know this sounds like a line, but allow us to explain.
While life insurers set their base prices, your specific rates are set by a bunch of factors that provide insight into how risky you are to insure. The big ones include your age and your health. The older you get, the more expensive your premiums. Any conditions you develop later in life will lead to higher rates, too.
In other words, unless you’re currently in very poor health, a policy will never be cheaper for you than it is right now. In fact, premiums increase by an average of 8% to 10% every year you put off buying it.
How to get the best life insurance rates
Of course, buying life insurance while you're still young and healthy is one way to save on rates. Here are some more.
- Opt for a term life policy, since they are much cheaper than whole life insurance policies and meet most shoppers' needs. For a full explainer on term vs. whole, check out our Learn Center page.
- Comparison-shop. Insurers change prices over time (see above). Plus, they all have different underwriting standards, so one life insurance company may be more amendable to your specific profile than others — and offer you a better deal. We can help you easily compare life insurance quotes across companies here.
- Pay premiums annually. Insurers offer a discount to people who pay for their policy in bulk. For instance, some companies offer as much as 8% off if you pay them once a year instead of monthly.
- Look for a guaranteed level term premium policy. That's a fancy way of saying your premiums won't increase during the life of your policy.
One final note: It's important to shop for the right amount of coverage. Our life insurance calculator can help you figure out how much financial protection you need.
Disclosure: Policygenius offers insurance policies from many of the nation's top insurers, who pay us a commission for our services. However, all editorial choices are made independently.
Disclaimer: Policygenius’ editorial content is not written by an insurance agent. It’s intended for informational purposes and should not be considered legal or financial advice. Consult a professional to learn what financial products are right for you.