Reader’s Question:

I have just moved to Indiana and I am wondering why my insurance premium, which I purchased in NY, is so much higher than what my colleagues here are paying for. Could there be any reasons why their premiums are cheaper?

Donald

Babylon, NY

Hello Donald!

Certainly! One of the reasons for higher insurance rate is that most life insurance policies pay commissions to the life insurance agent. Maybe your agent in NY had higher commission rates compared to the agents in Indiana. Another reason is that you might be paying more for monthly premium payments. You may not realize it, but many insurance companies charge extra fees if you makes monthly premium payments instead of paying annual premium.

If you really want to get your money’s worth, you might want to consider buying more coverage. Buying more can sometimes be cheaper. Most life insurance usually cost less per thousand dollars once you get into higher coverage amounts. If the number work out, you will be able to pay a lower premium rate, at the same time increasing your coverage.
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