Cheap life insurance: 5 tips for cutting costs

The cost of life insurance can be quite expensive, is there a way to get it on the cheap?

For many of us, life insurance is one of the most important forms of protection we are likely to buy. While it is a perfect way to give our loved one’s peace of mind, it can be expensive. Thankfully there are several ways to get cheap life insurance – of which we’ll be looking at in this article.

cheap life insurance

With life insurance, when you die a lump payment is paid out to your loved ones. This pay-out ensures they are protected financially during this difficult time. How your policy works depends on the type of cover you choose to take out.

Types of life insurance

There are two main types of life insurance: whole life insurance & term life insurance. Both of these cover types work differently – both in length & cost. As with any type of insurance, when you take out a policy you will start paying monthly payments to your insurance provider.

As the name would suggest, whole life insurance covers you for the remainder of your life. No matter when you eventually die, your insurer will pay out a lump sum to your loved ones – so long as you keep up with your monthly premium payments.

While whole life insurance is one of the most expensive types of cover, you have the benefit of knowing you are assured of payment.

With term life insurance, you are only covered for a set period of time – known as the policy term. Unlike whole life insurance, your family will only receive a pay-out if you die within the policy term.

Although whole life insurance is cheaper than the whole of life insurance, there’s every chance you could survive the policy term. This means you would need to get further cover if required, adding to the overall cost.

What affects the cost of life insurance?

When applying for life insurance, your insurer will ask you some questions that can affect your policy cost. These questions will usually be regarding:

  • Your age
  • Health
  • Family medical history
  • Occupation
  • Lifestyle

Other factors that can increase costs are:

  • The type of cover you want
  • The length/level of cover

5 ways to get a cheap life insurance policy

If you’re looking to save with cheap life insurance, you’ll want to follow these 5 tips:

Buy cover early

With life insurance, the earlier you take out cover, the less it could cost you. As you get older, the risk of developing medical conditions increases. This means your insurer is taking a risk in insuring as there is a greater chance of a claim being made. Therefore you will find that life insurance will be more expensive.

Opt for term life insurance

As mentioned before, term life insurance is one of the cheapest forms of life insurance cover. It’s a good alternative if you do not have the budget for whole life insurance.

Term life insurance can be bought from 3 types:

  • Level term – Standard type of term life insurance, providing a fixed cash sum upon your death.
  • Decreasing term – Designed to cover large payments such as a mortgage. As you pay off the outstanding balance of your mortgage, your pay-out sum decreases.
  • Increasing term – The pay-out amount increases over time in order to protect it from the effects of inflation. Because of this, your premiums are also increased.

Take out a joint policy

Joint life insurance provides cover for two people under a single policy. It is a popular choice for couples as it is easier to manage than two individual policies and can work out cheaper.

Joint life insurance works in two forms – first death & second death

  • With first death – the policy pays out when the first policyholder dies. The surviving member will then need to take out cover should they require it.
  • With second death – the policy pays out after both policyholders have died.

If you and your partner share the financial responsibility of your household, then it makes sense to get a joint policy. This will save you more money than if you both take out individual cover.

Improve your lifestyle

Not only does living a healthy lifestyle increases your life expectancy, but it can also cut the cost of life insurance. While you don’t need to transform into a fitness freak overnight, it’s important that you take care of your body.

You can improve your lifestyle by:

  • Exercising as often as you can
  • Eat healthier
  • Limit your alcohol intake
  • Quit smoking

If you can ensure these things then your insurer will look at you more favourably and your cover could cost less. Smoking is an important factor for life insurance as if you are a smoker your policy will cost more. Some insurance providers will reduce your premiums as an incentive if you quit.

Shop around

Thanks to the help of the internet there are plenty of ways to find life insurance. Though comparison sites are a quick and easy way to compare quotes, most of these websites work on commission.

To receive the best quotes and advice, it’s worth speaking with an advisory life insurance broker. They can help you choose the best form of cover for an affordable price.

What does life insurance cover?

The beauty of life insurance is that it can be used to cover a whole range of financial commitments your family may need support for after you’ve gone. A pay-out from life insurance can pay towards:

  • Household bills
  • Everyday living costs
  • Covering a mortgage
  • Outstanding debts or loans
  • Education costs such as school fees or university tuition
  • Funeral expenses

Before you take out cover, it’s best to think about the amount of cover your family needs. Depending on the circumstances, your family may need less or more support for the future – this could save you spend more money or cover you may not need.

Does life insurance cover terminal illness?

While life insurance does not cover terminal illness or injury, there are a few options available. Terminal illness & critical illness cover can be bought as add-ons to an existing life insurance policy.

  • Terminal illness cover ordinarily pays out if you are diagnosed with a terminal illness in which you will die within 12 months. If you do live longer, you will not need to pay anything extra. Make sure you have read which illnesses are covered by your insurer before taking out cover.
  • Critical illness cover pays out a one-off payment if you become seriously ill, injured or disabled. This payment is to provide you and your loved ones with financial support during this difficult time. Just like terminal illness, it’s important to understand which illness/injuries you are covered from.

Where can I buy life insurance?

Life insurance quotes can be found from a variety of sources such as:

  • Directly from insurers
  • Specialist insurance brokers
  • Comparison sites
  • Large retailers such as supermarkets
  • Financial advisors

So what are you waiting for? Protected you and your loved ones by taking out a policy today!


Tech & Finance blogger and digital agency consultant – Dave has worked in digital for 11 years in client-side, agency-side, and freelance consultant capacities.

He now writes engaging content and creates innovative digital strategies for the finance and tech industries. He is the creator of Enviroute – A new travel app to check the Severn bridge status – that is currently seeking investment.

Dave spends more time than he cares to admit watching skateboarding videos and likes to express himself through the medium of internet memes!”

If you want to work with David on your content marketing, or improving your digital agency operations, you can reach out via his LinkedIn profile here.