- Longer life span People aren't dying as early or as often. Health care advances, better personal care and even all those seat belts and air bags are postponing the inevitable and reducing premature deaths. For 25- to 44-year-olds, the death rate dropped from just under 178 per 100,000 in 1996 to just under 162 in 2004 -- a 10% drop in less than a decade.
- Corporate efficiency Automation advancements have made insurance companies more efficient and flexible, and have improved risk assignment and investment management. Corporate-speak translated: fewer premium dollars go to overhead.
- Competition The Web has increased transparency, driven prices down and made it easier for customers to price-shop. Term life insurance is simple enough that you can really shop and buy online. Portals such as
Insweband einsurance.comoffer dozens of competitive quotes.
- Flesh out coverage. Premiums may have gone down, but living costs, especially those of families with children, haven't. Surviving spouses and families need health care, and that certainly isn't getting cheaper. Ditto for college. What about dependents' years prior to Social Security and Medicare eligibility? Studies show that while three in four families have life insurance, most don't have enough coverage. For $50 a month, and perhaps under $30 a month if a "preferred" risk, a 40-year-old male can now get $500,000 in coverage. Not bad.
- Re-evaluate your policies. You thought you were so smart buying that 20-year level term policy, with constant payments through the period. Although the later years are the better deal, you might find still better rates in a new policy. And if you're buying a new policy, consider buying shorter terms to take advantage of further reductions.
- Redirect coverage. Your life -- and the income you generate -- is important. But perhaps your insurance dollars are better spent on disability or additional health coverage, which are several times more likely to actually be needed. Or maybe you can buy a cheaper policy and plunk the difference into your IRA or 401(k).