Factors Affecting Your Life Insurance Costs

Life Insurance is the best way to protect the loved family members after the demise of the earning member in the family. The cost of the premium and the coverage it provides differs from one plan to another and it also depends on the insurance company. Life Insurance costs also depend on several factors such as age, general health, and other clauses specified in the policy.

Factors That Influence the Cost of Life Insurance Policies

Life insurance policies though tagged with tremendous future benefits are a liability at the present. The policyholders have to chunk out a huge sum of money as premiums and several factors affect the insurance costs as well. These factors are:

1. Age of the Insured

Younger policyholders have lower life insurance premiums than their aged counterparts. When the applicant is young, it is less likely for them to incur diseases and the probability of death at a young age is low. And thus the insurers render the policy for a lower premium. As age increases the cost of life insurance also increases. 

2. Gender

It has been estimated through statistical tools that women live longer than men by probably five years. Thus they pay premiums for a longer period than men and enjoy slightly lower premium rates.

3. Medical History

Some insurance policyholders suggest a medical examination and will review the complete health records before issuing a policy. If the applicant is found to have higher cholesterol levels, high BP, and weight, then they are prone to get future medical conditions, thus they will incur higher life insurance costs. Individuals with a health history of medical conditions such as heart diseases, diabetes, cancer, etc., will also have to pay higher premiums.

You may also like to read:- 7 Reasons Why You Have To Pay Higher Premium For Life Insurance Than Others  

4. Occupation

People involved in riskier jobs such as pilots, sailors, and those working in mines and oil rigs will be required to pay higher premiums when they opt for life insurance policies. Insurers will demand a higher premium considering the risk of disease and death associated with these jobs.

5. Type of Policy

The life insurance policy that one chooses is an important factor that affects its costs. Policies that offer larger sum assured and render long term coverage will generally cost more than policies that render smaller benefit amount over shorter periods. Also, whole life insurance plans are more expensive than term life insurance policies.

6. Habits

Certain habits like smoking and alcoholism predisposes an individual to chronic health problems and can also lead to an early death. Thus individuals with such habits will have to pay a higher premium than a non-smoker and non-alcoholic.

7. Family Health History

A family history of cancers, stroke, and other serious medical conditions can also play a major role in insurance costs, as the applicant is prone to develop such conditions in the future.

Must Check

Life Insurance Company 

Life Insurance Benefits

Also Read:- What Is The Impact of Age on Life Insurance Premiums?  

Bottom Line

Making necessary changes to one’s lifestyle such as quitting to smoke, losing weight, and adopting healthier ways to keep blood pressure and cholesterol levels under check, will not only help to lead a long and healthier life but also to lower life insurance costs. 

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.