What premium mode should I choose
when purchasing a term life insurance policy?
Most life insurance companies offer a variety of
premium payment options including annual, semi-annual, quarterly or monthly payments.
In deciding
which premium mode to choose you should consider the following:
If you choose to pay an annual
premium and then decide to terminate your life insurance policy before the end of the year,
the insurer is not required to refund any portion of the premiums you have already paid.
Also, there is a higher cost associated with making more frequent premium payments each year because there is added work to handle the processing of the additional payments.
You can compare the overall cost of premiums for monthly payments compared to annual and other payment options to determine how much more it would cost you per year for your life insurance policy by paying premiums monthly compared to other less frequent payment modes.
Generally, if you can afford it, you may save money by choosing to pay your life insurance premiums annually - once per year.
Compare life instance price quotes among leading life insurance carriers.
