Shopping for life insurance is confusing to many. Deciding whether to pay policy premiums by the month or for the year takes some consideration. The premium is the amount you’re responsible for paying to keep a policy active. There are pros and cons to each payment arrangement, so carefully weigh your options before choosing. Here’s some insight to help you decide. 

Monthly vs. Annual Life Insurance Premium Payments 

Paying Monthly

Some consumers find that managing their budget is easier if they make smaller monthly payments for life insurance rather than parting with a substantial sum all at once. You may also find that spreading the cost over a year gives you more flexibility to save or spend. However, when you pay monthly, you may pay more in administrative fees. You may also be required to authorize automatic withdrawals from your bank account to pay monthly premiums. 

Paying Annually

A significant advantage of paying your life insurance premium annually is that insurers may offer a discount. If you can afford it, enter the date when the premium payment is due and make the payment in full. Paying for insurance yearly, instead of monthly, will also save you a bit of administrative time. Writing one check or making one electronic funds transfer (EFT) per year is more convenient than writing 12 checks or scheduling 12 EFTs.

If you’re in the market for life insurance, let our team of experienced agents at Farmers Insurance Group help you make informed decisions. We have extensive industry knowledge and will take the time to explain your payment options so you can identify which best suits your finances. Over the years, we’ve proudly provided countless clients from Mountain Grove, MO, with valuable protection and peace of mind. To request a quote call (417) 926-7900, and follow us on Facebook to keep up with agency news.