More than any other form of insurance the commodity offered by Life insurance in exchange for your premiums is peace of mind. There are two types available: Whole Life cover, which remains valid until you either die or surrender the policy, and Term Life which provides life cover for a specified length of time.

Whatever life insurance you decide to buy the same tips for getting the most for your money apply.

The sooner the better

If you are already approaching retirement this isn’t going to be helpful, but for the younger readers out there, if you have assets and dependents, the sooner you purchase life insurance the better. Premiums are substantially lower for younger purchasers and usually at a younger age your health is correspondingly better – also a consideration where costs are concerned. Be aware that some companies raise premiums 6 months before your birthday date – so at 29 ½ you would be considered 30 years old!

Ditto for health

Again, this tip is redundant if you are already suffering from high risk diseases such as heart conditions, diabetes or cancer. Obviously the healthier you are when you buy life insurance, the better the risk for the company and the lower the premiums.

If, however, you had health problems when you bought your policy and these have now improved, it is probably a good time to start shopping around for a new policy with lower premiums, making sure you allow enough time to get your new policy in place before the old one lapses.

Similarly if you are still trying to stop smoking now is probably not a good time to purchase a 30 year term policy. Once you have stopped, your premiums will decrease significantly.

Death defying hobbies

If you enjoy climbing mountains, or jumping off them, or if you fancy yourself another Michael Schumacher or Jacques Cousteau you might have difficulty persuading an insurance company to sell you life insurance at a reasonable rate.

However, don’t despair; different companies consider risk factors differently. Just make sure you choose the right insurance company for your life style.

How long?

The length of cover you select depends on a number of factors related to your personal circumstances. Whole life insurance cover is generally, as its name indicates, purchased for the duration of your life. If, however, you have no dependants and no debts to leave behind the necessity for this type of life insurance is questionable.

The length of term insurance depends upon the reasons for purchasing it. The length of your bond is a good determination. Someone in their 30’s starting out with a family and a new home might consider a 20-year term or more whereas someone approaching retirement, perhaps with children finishing University, would probably look at a 5 to 10-year term to ensure that fees would be covered should they die before their responsibility has been met.

How much?

The purpose of life insurance is to replace the loss of your income for your beneficiaries. Although insurance agents, motivated by commission might try to sell you more, most financial advisors recommend an amount approximately 5 to 10 times your annual income.

Finally, review your policy often, particularly if your circumstances change, to be sure you are not overspending on life insurance. A diverse investment portfolio, which includes life cover, is your best option.