Taking the step to finding a life insurance policy is a smart decision to make for you and your family. After purchasing your policy, you’ll want to find a dependable way to pay your policy’s premiums. Missing a life insurance policy payment can lead to lost coverage, so making sure you’re able to pay is important to maintaining your life insurance coverage.
How do you pay for life insurance?
Types of accepted life insurance payment methods vary by insurer. The most common accepted payment methods are personal checks, cashier’s check or an electronic fund transfer (EFT).
Paying for life insurance monthly vs. annual premiums
Most life insurance policies will allow you to pay either monthly or annually. Oftentimes insurance companies will offer a discount if you choose to pay annually. If paying a full year of insurance premiums is difficult for your financial situation, setting up monthly payments may be a better option. Setting up monthly payments on the same day each month can help you plan for payments and avoid a policy lapse.
Can you pay for life insurance with a credit card?
It varies from life insurance company to life insurance company on whether or not you can pay your premiums with a credit card. While you may be allowed to for your first payment, it’s often not an option after that. Oftentimes, high fees and state regulations prevent insurance companies from accepting credit cards as a form of payment. If your insurance companies allow credit card payments, they may add a processing fee. You’ll want to make sure you understand all of your insurance payment options when you first purchase your life insurance policy.
Can you pay for a life insurance policy in full?
Since premiums for permanent life insurance don’t change, it is possible to pay for certain permanent or whole life insurance policies in full. This type of payment would be in place of monthly or annual premiums in order to secure a death benefit. While these situations aren’t as common, it could still be an option if you have money available to pay upfront and ensure you never miss a payment.
How much does life insurance cost?
The cost of life insurance depends on the amount of financial security you want to leave to your beneficiaries. If you’re looking for the more inexpensive life insurance option, term life insurance would be your best option. Additionally, both term life and whole life insurance use several factors, such as your age, health, the amount of benefit you choose and more to determine your monthly premium.
What happens if you stop paying your life insurance premiums?
If you are unable to pay your life insurance premiums, most life insurance policies include a grace period—usually around 30 days after your payment was due—before your coverage lapses. If your life insurance policy lapses, you will lose your life insurance coverage.
SelectQuote Can Answer Your Life Insurance Payment Questions
With so many options and different types of life insurance coverage, finding a life insurance policy can seem daunting. At SelectQuote, we can help you through the process, comparing rates and coverage, while also getting all of your life insurance payment questions answered. We’ll help you understand the ins and outs of the policy you choose, making you feel confident that your life insurance policy meets all of your needs and fits in your budget.