The life insurance company will establish an automatic draft linked to your checking account, and deduct the monthly premium on the date that you specify.
Small service charges, approximately 3-3.5 percent of your annual premium, will be added to your payment and vary by insurance company. Annual, semi-annual and quarterly payment modes are also available.
Annual payments have the lowest 12-month charge of these alternatives for payment on your life insurance policy.
So, you would save some money by paying your life insurance premiums on an annual basis instead of monthly.
Here's how you can compare life insurance rates with different payment options.