Life insurance is an essential financial tool, but it’s easy to feel overwhelmed when it comes to selecting the right policy. Many people end up paying more than they should for their coverage, either because they don’t shop around enough or because they don’t fully understand the options available to them.

The good news is that with a little research and planning, you can avoid overpaying and get the coverage you need at a price that fits your budget. Here's how.

1. Shop around and compare quotes

One of the easiest ways to get cheap life insurance is by comparing quotes from different providers. Premiums for life insurance can vary between companies, so don’t settle for the first offer you get. Take the time to get quotes from several reputable insurers to see which one offers the best value.

It’s also important to note that different insurance companies may assess risk differently. A policy that’s cheaper with one insurer might cost more with another, so make sure you’re comparing the same types of cover and benefits.

2. Choose the right type of policy

Life insurance isn’t a one-size-fits-all product. The two main types of life insurance are term life and whole life. Term life is generally much more affordable than permanent policies like whole life, offering cover for a set period (e.g., 5-50 years).

If you only need cover for a specific time — say, until your mortgage is paid off or your children are grown — term life insurance is usually the more cost-effective option.

Whole life insurance, on the other hand, offers lifelong cover but this comes with higher premiums. Before committing to a permanent policy, ask yourself if the added cost is worth it for your financial goals.

3. Assess how much cover you need

Many people either overestimate or underestimate how much life insurance they need. If you buy too much coverage, you could be paying higher premiums for no reason. On the other hand, if you buy too little, your loved ones may not have enough financial protection.

A simple way to calculate your needs is to think about what you want to replace: your income, any debts (like your mortgage), and future expenses (such as your children’s education).

A common rule of thumb is to have life insurance coverage that’s 10-15 times your annual income, but this can vary based on your specific situation.

4. Don’t wait too long to buy cover

One of the biggest factors influencing life insurance premiums is your age. The older you are when you buy a policy, the higher your premiums will likely be. Ideally, you should purchase life insurance while you're still young and healthy. If you're in your 20s or 30s, your premiums will be much lower than if you wait until you’re in your 40s or 50s.

In addition, if you wait too long and develop health conditions, you may be seen as a higher risk by insurers, which could also raise your premiums. It’s smart to lock in a policy sooner rather than later to secure the best rate possible.

5. Maintain a healthy lifestyle

Your health plays a key role in determining how much you pay for life insurance. Insurers typically offer lower premiums to non-smokers, those with healthy BMI levels, and individuals without chronic health conditions. If you’re in good health, you can take advantage of these lower rates.

If you're not already in the best shape, consider making some lifestyle changes. Quitting smoking, eating healthier, and getting regular exercise can not only improve your health but could also lower your life insurance premiums over time.

6. Review your policy regularly

Once you’ve purchased life insurance, it’s important to review your policy at least once a year to check it still meets your needs.

You may need to increase or reduce your cover if you’ve had a major life change, such as getting married, having children, or paying off a significant amount of debt. If your financial responsibilities have changed, adjusting your policy could help you save on premiums or so that your cover remains adequate.

If you find you’re paying for more cover than you need, or if your insurer raises rates without providing additional value, it might be time to shop around again.

7. Avoid lapsing on premium payments

Missing a premium payment could cause your cover to lapse, leaving you without protection when you need it most. If you are several years into the policy you may find it to be more costly if you have to reapply for cover, especially if there are changes to your health.

Most companies will set up direct debit payments to help you avoid missing a payment, which is the easiest way to make sure your premiums are paid. However, if you change cards it can be easy to forget about updating your payment information.