The 20 best tips to save on your life insurance premiums.

The 20 best tips to save on your life insurance premiums.

DO NOT LOSE MONEY WITH THESE TIPS!

Did shopping for your new car cost you a lot of time and money?

Choosing your life insurance is just as important, if not more, than buying a car since it is for your entire life. Let us say you buy a 30-year life insurance with an annual premium of $500. This means you risk paying $26,000 before it is paid, considering that life expectancy in Quebec is about 82 years.

This is a big sum. To give you a more concrete idea, here is a table showing the cost of life insurance and permanent life insurance with a coverage of $100,000 for a non-smoking individual based on age at the time of subscription. These prices are for illustration purposes only and may vary depending on age, gender, type of coverage, and choice of insurer.

 

PRICE FOR LIFE INSURANCE UP TO 82 YEARS OLD* 

(*average Canadian, non-smoking, male and female combined)

For an insured sum of $100, 000

Cost of subscribing to life insurance up to 82 years old in Quebec.
 

Age when you subscribed to a life insurance policy

25 years 30 years 35 years 40 years 45 years 50 years 55 years 60 years
Term life insurance** $38,820  $46,344  $37,044  $32,304  $36,900  $43,944  $34,164  $28,584 
Permanent life insurance** $21,204  $21,840 $24,534 $30, 744  $34,632  $43,392  $46,656  $52,008 

**These prices are approximate and correspond to offers from insurers.  They come from an electronic price comparison and are susceptible to change.

If you want to get a quote from one of our partners (all insurance brokers and insurers) and find out the rate according to your profile, please fill out our online form.

 

You can arrive at these conclusions by referring to the table above:

  1. It is better to take out life insurance while you are young to save on costs.
  2. Permanent life insurance with fixed premiums will cost less if you buy it at a younger age.
  3. Save more than $30,000 on your life insurance if you subscribe at 25 years instead of age 60!

You are now familiar with the basic principles behind life insurance. In this article, we will give you 20 tips which will allow you to pay less for your premiums.

Use an insurance professional to help you find the best deals. Financial security brokers and advisors will be able to establish your needs and present you with available solutions.

Keep in mind that saving from the price of life insurance, while always good, may not help you to make ends meet in the future.

Be smart in your choices and let an expert guide you in choosing the right life insurance for you.

 

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A compilation of the top 20 tips to save on life insurance in Quebec !

A list of the top 20 ways to save on life insurance for Quebecers.Here is the moment you have been waiting for. We will reveal the top 20 tips to pay less for your life insurance!

There are so many life insurance products and options in the market to make your head spin!  Too many choices can cause you to feel nervous about choosing the wrong product or paying too much.

Let us look at the reasons why Quebecers choose certain life insurance products and whether they were right to base their choices on their selection criteria.

DON’T TAKE JUST ANY LIFE INSURANCE

 You can make sure that the insurance company or broker is in good standing and has the right to offer life insurance products by contacting the Information Center of the Autorité des marchés financiers (AMF) or use the Register of AMF of companies and individuals that are authorized.

 

 

Tip #1 on mortgage life insurance

Avoid the mortgage life insurance trap!

Don’t fall into the mortgage life insurance trap!
Why?

As a general rule, this insurance product does not benefit anyone other than the bank holding your mortgage. Further, this insurance is owned entirely by the financial institution. Some lenders make this insurance mandatory.

If that is the case, you can still shop and choose your mortgage life insurance and not subscribe to the product offered by your bank.

In most cases, insurance professionals will recommend permanent or term life insurance which provides more benefits for you.

It is not advisable to accept the insurance coverage offered by the bank where you obtained your loan because it is also more expensive.

Rather, shop around in the comfort of your home for your life insurance. Your age, gender, health status and whether you smoke or not will affect the rate of your premium.

All these criteria come into play if you want to pay less. Don’t wait until your mortgage is fully paid to obtain your life insurance. It will become more expensive then and if your health deteriorates, you could even be refused coverage.

 

Tip #2 on term life insurance 

The life insurance product which costs almost nothing!

For the least expensive life insurance.
Why?

Term life insurance is by far the most affordable of all. Indeed, its premiums are extremely low and will not ruin you.

Often, people will choose this type of coverage when they want to make up for a loss of income or an employee or to provide financial security for their loved ones if an untimely death occurs.

As the name says, this protection is temporary, so for a predetermined time.

This type of insurance is intended to fill a momentary need. You can choose to renew it or not when it comes to an end.

 

Tip #3 on term life insurance

Convert your term life insurance into permanent life insurance.

Don’t lose your term life insurance by converting it!
Why

If you want to avoid price increases when you renew your term insurance, or if you want more options and benefits by subscribing to a more comprehensive life insurance product, you can convert your term insurance into permanent life insurance.

Simply contact your life insurance company before the expiry of your agreement and make your request.

Otherwise, your premiums will increase at best or you could be refused.

 

Tip #4 on term life insurance

Your family business is protected from bankruptcy by term life insurance.

Protect your business from bankruptcy!
Why?

Thanks to its generous coverage, your life insurance is able to protect your business in the event of your death, allowing you to leave it to your heirs instead of going into bankruptcy.

In order to ensure financial security, or even improve the finances of your loved ones, subscribing to life insurance covering all of your debts is mandatory.

The coverage of term life insurance varies between $10,000 and $500,000 depending on your needs and budget.

 

Tip #5 on life insurance

Update your life insurance every time that your standard of living changes.

Constantly review your life insurance coverage!
Why? The more your income increases, the better your quality of life. You can protect your family from a loss of it by adjusting your life insurance accordingly. Consult your broker to update your coverage.

When you are no longer of this world, your loved ones will also lose your income and their standard of living will be greatly affected.

True, your life insurance may cost you less than $ 20 in your twenties … but it only covered a small amount since your needs were lower. Following the purchase of your house and your vehicles, this protection should be increased to protect your current assets.

 

Tip #6 on disability insurance

How to reduce the cost of premiums of your disability insurance?

Pay less for your disability insurance
Why?

When a disability occurs, there is a waiting period to meet which is stated in your contract. This is a period during which you will not be compensated. This duration varies according to the contract.

If you cannot find a copy of your contract for your disability insurance, ask your insurance company about it. You can also ask them for a copy of your contract.

When signing your agreement, you will normally have been given a choice from 30, 60, 90 or 120 days. If your finances allow for a total loss of income for 4 months, it is advisable to choose the longest waiting period in order to pay for lower premiums.

Some employers provide sick leave for their employees. If you have some available, you can use them during this latency period.

 

Tip #7: On disability insurance

The risks of working while on disability.

If you receive disability benefits, do not work!
Why?

Mathieu is a day laborer with several Quebec agricultural companies. During a trip to Gaspésie, he injured his hand and is no longer able to perform his tasks. He receives benefits from his insurer because of his disability. To avoid boredom, he helps a friend who owns a small business. This friend pays him a salary in return for his work.

When the insurer became aware of this income, the company adjusted the amount of Mathieu’s benefits. He thought he could make a little more money at the end of the month but unfortunately, this is not the case.

If you are on disability, ask your insurer about the special features related to your benefits to avoid complications.

 

Tip #8 on disability insurance

Be aware of the conditions and exclusions in your disability contract to avoid unpleasant surprises.

Pay special attention to the exclusions stated in your contract!
Why?

What is an exclusion?

Suppose you have low back pain or are diagnosed with depression, your insurance company will not provide you with any benefits related to your lost wages because they are medical conditions excluded.

This list can be exhaustive according to insurers. Do not fall in the trap of swapping a few dollars less on your disability insurance premiums for an endless list of exclusions. Otherwise, your insurance has no relevance and can never be used.

 

Tip #9 on disability insurance

Opt for irrevocable salary or disability insurance if you could!

Try to get a non-revocable disability insurance !
Why?

What is this insurance?

Non-revocable disability insurance cannot be canceled by your insurance company for the full duration of the contract. Nor can it be subject to an increase in premiums.

Talk to an irrevocable salary or disability insurance professional.

This coverage will usually protect you until you reach age 65. This is, by far, the best disability insurance available in Quebec.

It is a little more expensive than conventional disability insurance, but because of its irrevocability, you can keep it even if your health deteriorates or your income decreases.

Note that this form of disability insurance is only offered to people with high-paying jobs.

 

Tip #10 on life insurance 

The most important tip is to shop around and compare insurance offers!

Shop around and compare!
Why?

Compare the insurance companies’ offers before subscribing to a policy. From one insurer to another, the difference in price can be really important, as are the options, conditions, and exclusions.

It is worth shopping around for the perfect insurance solution for your needs!

By using the tool that « Compare Insurances Online » offers, you can save a lot of time.

Entrust this task to one of our partners (a broker or financial advisor) who will research, evaluate, and compare the offers in the market for you.

 

Tip #11 on life insurance

If you have a critical illness, you could still obtain insurance coverage!

Don’t despair if you have a critical illness!
Why?

If you have an illness, some insurance companies may still give you coverage. While premiums will be higher, it is possible to get protection.

The best thing is to subscribe to your insurance while your health is good.

By comparing prices (see the previous tip), you will at least have the chance to find the most affordable policy for you.

 

Tip #12 on life insurance

The 6 things you need to absolutely do before changing your insurance!

Before replacing your insurance policy, do this.
Why?

It is possible that your coverage is no longer adapted to your needs and you want to replace it with a new insurance policy. Here’s what you must do BEFORE canceling your current policy:

  • Make sure that the new coverage is active.
  • Calculate that the cost difference is within your budget.
  • Your broker or financial advisor must complete a “Notice of Policy Replacement” form. This one compares your old cover with the new one so as to clearly show the advantages and disadvantages of the changes you want to make to your insurance. The professional must explain it to you and tell you about the consequences of replacing your policy. Even if your representative explains it in detail, it is always best to read the document yourself to make sure you agree with this change. Take the time to think about it if you have to.
  • Never sign a contract until you have fully read it and be sure to understand. This is also true for an insurance contract.
  • Make sure you understand the advantages and disadvantages between your old and new insurance.
  • Check with your insurer if you will have a tax charge if you change insurance. This could happen if, for example, you have accumulated interest with a universal life insurance policy.

 

Tip #13 on life insurance

It pays to be honest with your insurer.

Be honest when filling out your forms!
Why?

When you want to buy insurance, you have forms to fill out. You may be asked questions about your health condition.

Tell the truth. In order for your coverage to be valid, it is essential that you declare ALL that could influence the price of your premiums.

If you neglect this fact, the insurance company may be entitled to refuse to pay your benefits or significantly reduce your coverage.

 

Tip #14 on life insurance

Signing up for a life insurance policy sooner will save you a lot of money!

Buy life insurance now and save a fortune!
Why?

In general, the sooner you subscribe and the better your health, the less expensive your insurance will be. (see table at the top of the page)

Beware of insurances that could be very affordable at first, but become more and more expensive over time.

There are types of insurance whose premiums will remain unchanged throughout your life. There are also various administrative costs higher than others.

In any case, it is important to ask questions from the professional assisting you to fully understand the details of the policy before signing the contract.

 

 

Tip #15 on life insurance

How to properly address your checks to pay for your life insurance.

When you issue checks to pay for your life insurance
Why?

Your checks must always be in the name of your insurer, never in the name of the broker or adviser.

The representative (whether an insurance broker, a financial security advisor or an insurer) will be paid by the insurance company. Do not worry about him!

 

Tip #16 on universal life insurance 

Make sure you understand the investment option of your life insurance and that you need it.

Do you really want to invest with your life insurance?
Why?
  • Does the life insurance product you offer a savings component?
  • If so, how do you choose the type of investment?
  • Are there any fees related to this placement?
  • How much is the rate of return of the chosen investment?
  • Are there any risks associated with it?

Before you buy universal life insurance, be sure to make maximum contributions to your TFSA and RRSP.

 

 

Tip #17 on permanent life insurance Understand the cash surrender value of permanent life insurance.

Before taking out a permanent life insurance policy for its cash value, make sure you understand it !
Why?

With permanent life insurance, you usually have access to a cash surrender value.

This is an amount you recover by terminating your insurance policy.

If you want to cancel your insurance to get your cash surrender value, make sure to consult your insurance broker or financial security advisor first as there are tax implications and financial consequences associated with it.

It may be possible to borrow a fraction of this value without canceling your insurance contract. Like all loans, this one is subject to a variable interest rate depending on the company and failure to pay could end your coverage.

 

 

 

Tip # 18 on life insurance

Avoid complications and extra expenses by adding revocability clauses.

In your contract, all of your beneficiaries must be revocable!
Why?

You must name your beneficiaries when you sign your life insurance policy. You can then designate who you want: your children, your spouse, friends, a charity or any other person. If you had to change beneficiaries during the course of the contract, all you have to do is fill out a form to make the desired changes. This may be necessary in case of a divorce, for example, or in the event of a falling out with a family member or friend.

By not designating any beneficiary, your heirs, according to your will, would receive the compensation provided for in your contract. To avoid administrative procedures to your estate, it is best to designate the beneficiaries at the time of the signing of your contract.

By adding the revocability clause for each named beneficiary, you make sure you can change them later if you wish.

We mention revocability because it has happened a few times that individuals have added their spouse as irrevocable beneficiary to their contract. After a separation, the process of removing that person from their contract is difficult (sometimes impossible) and expensive.

The most important thing is that your death benefit is paid to the person of your choice.

 

Tip #19 on life insurance

If you are making a big investment such as a real estate property, consider protecting it with life insurance.

You want to protect a big investment such as a house!
Why?

A real estate investment such as the acquisition of a building, a cottage, or a house, represents a very heavy financial burden, especially when there are still several years before the full mortgage repayment. You can protect this heritage that you want to bequeath to your family.

By taking out insurance, you are able to bequeath this property to your estate instead of it being taken back by the bank.

Think of the fact that like your assets, your debts are also transferable to your heirs. You should never force those who survive you to pay your debts, whether for a property or for anything else.

By subscribing to a full life insurance or term life insurance, you will protect everyone.

 

 

Tip #20 on life insurance

Be sure to seek expert advice from life insurance professionals.

Surround yourself with professionals to assist you in your choices!
Why?

No one is better placed to find the insurance product that works best than a professional.

The “Compare Insurances Online ” web platform serves as a bridge with our partners, which are insurers and insurance brokers. These represent more than twenty insurance companies in Quebec.

Designed to save you money, but also time, our form takes only a short time to complete and does not commit you at all to a course of action.

The professionals with whom we are in a partnership will target your needs thanks to the answers you send them and will compare for you the products in order to make you a proposal.

Take advantage of what you learned today by asking for your FREE QUOTE!

 

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