Looking for Smart Ways to Save on Term Life Insurance Canada? Term life insurance is THE most affordable way to protect your family.
That said, there are still some awesome strategies to further reduce costs. Whether you are purchasing your first policy or reviewing a renewal, these tips can help you save thousands over the life of your plan. Below are some proven methods to save on term life insurance in Canada.
And my guess is that in today’s economy, we can all use a little savings.
Choose the Full Medical Exam If You Can
Many insurers offer two types of applications.
- Full underwriting (with medical exam)
- No-medical or simplified issue
No-medical policies sound convenient, but they often come with higher premiums, sometimes 25%–50 % more. So if saving some cash is your goal and you are young and healthy, I recommend fully underwritten coverage every time.
Taking the comprehensive medical exam provides the insurer with complex data to assess your risk. This often rewards healthy applicants with significantly lower rates. If you’re in good health, this is one of the simplest and most powerful ways to save on term life insurance in Canada.
Prepare for the Exam to Boost Your Results
Preparing for your paramedical exam can significantly improve your lab results and vitals.
Better results often lead to a better health classification, which in turn means lower monthly premiums.
Here are some tips on how to prepare for your medical exam:
1. Hydrate well for 1–2 days before the exam: Drinking plenty of water to maintain optimal hydration levels is key. Proper hydration facilitates easier blood draws and supports the healthy functioning of your kidneys and liver, which is important for reliable test results.
2. Fast for 8–12 hours before the exam: Abstaining from food during this period can lead to more precise measurements of cholesterol and blood sugar levels, as fasting helps eliminate temporary fluctuations caused by recent meals.
Imagine fasting like giving your internal plumbing a temporary flush. By avoiding food and drinks beforehand, your healthcare provider gets a clearer baseline reading of what’s naturally circulating in your blood. This allows for a more precise measurement and a more reliable interpretation of your results.
3. Avoid salty and processed foods for 24 hours: Steering clear of foods high in sodium and preservatives significantly helps to lower blood pressure and reduce fluid retention, leading to more accurate assessments of your cardiovascular health.
4. No alcohol for 24 hours before the exam: Do not opt for that beer after work! Refraining from alcohol consumption allows your body to stabilize, preventing any spikes in blood pressure and liver enzyme levels, which can be misleading in lab results.
5. Avoid caffeine for at least 6–8 hours before the exam: We all love our morning Joe, but limiting caffeine is a must. It can raise blood pressure and heart rate, potentially skewing test outcomes.
6. Skip heavy workouts the day before the exam: You’ll rarely hear me say forget the workout. But this is one of those times. Engaging in intense physical activity can temporarily elevate cholesterol levels and heart rate. By resting, your results will more accurately reflect your baseline health.
7. Get a good night’s sleep before your appointment: Getting your Z’s is always important, but even more so on your exam day. Aim for 7–9 hours of quality sleep, which can help reduce stress and anxiety that may affect vital sign readings, such as blood pressure and heart rate, ultimately contributing to better outcomes.
NOTE: Reschedule if you’re sick or overtired
If you don’t feel good or are excessively fatigued, it’s wise to postpone your exam. Illness and exhaustion can adversely affect lab results, so taking the time to recover ensures you get the most accurate assessment of your health.
These simple habits can bump you into a better rate class, reducing your payments for 10, 20, or 30 years.
Review and Replace Your Policy Before Renewal Increases
Many Canadians are unaware that their term insurance policies can renew at significantly higher rates once the initial coverage period expires. For instance, a 10 or 20-year term policy might see its cost triple or even quadruple upon renewal. Wow! Now that’s not something most of us want to see.
Here are some strategies to save money by proactively reviewing your policy:
- Start reviewing your policy 3–5 years before renewal: This gives you time to shop around and requalify while you’re still healthy. Its never too early to start looking at your options.
- Compare your current renewal quote to new quotes: Updated coverage is often cheaper than letting your current policy auto-renew.
- Adjust your coverage amount if your needs have changed: Has your mortgage been paid down? Are your kids grown up? You may need less insurance now. Peeling away those layers of debt really helps.
- Avoid association and group plans that renew every 5 years: These often increase 40%–60% per age band, which adds up way too fast.
Reviewing your policy regularly is one of the most overlooked ways to save on term life insurance in Canada.
Ask Your Broker to Write a Supportive Cover Letter
Applications often don’t tell the entire story. A good independent broker can include a personalized cover letter to outline your healthy lifestyle and positive habits. This seemingly small touch can have a big impact on how an underwriter assesses your risk.
Considerations for Improving Your Insurance Rates
- Detail Your Exercise Routine: If you work out regularly, this could help you qualify for preferred rates. That gym membership pays.
- Include Your Healthy Eating Habits: Following a low-fat or plant-based diet may positively impact how your blood test results are interpreted.
- Share Your Family History of Longevity: Having grandparents who lived into their 80s or 90s can have a favorable impact on your long-term health risk.
- Note Any Health Improvements: Did you lose weight, quit smoking, or start an effective medication? Be sure to mention these changes.
- Describe Your Occupation and Lifestyle: Stable, low-risk jobs typically contribute to better insurance ratings.
- A Well-Crafted Letter from Your Insurance Broker: This can enhance your rating class, potentially leading to a premium reduction of 20% or more.
Summary: Best Ways to Save on Term Life Insurance Canada
Always remember that taking the dreaded medical exam can significantly lower your rates. But it’s not just that; preparing for the exam improves your chances of achieving an excellent health classification. Once you are covered, life insurance isn’t set-it-and-forget-it. Reviewing your coverage before renewal helps avoid dramatic increases in premiums. So don’t forget to add important review dates to your calendar.
And a word to the wise. If you are in the process of looking for coverage and have been given a rating you don’t think you deserve. Don’t forget to have your broker write a letter of support. This can improve your classification and reduce your overall costs.
By implementing these strategies, you can save thousands over the life of your policy without sacrificing your coverage.
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