Affordable Life Insurance Protection for Your Family
Term life insurance premiums are about life insurers managing risk. Insurers manage risk and avoid it by setting rates that will allow them to profit from the premiums you pay.
They analyze the risk of you dying by reviewing your responses to the questions on the application and results of your physical exam. Their goal is to take care in choosing who they insure, so their insured lives longer and pays more premiums.
What type of risk are life insurance companies interested in?
Basically the same risks we are all concerned about with our health and longevity.
Subjects we hear discussed each day on the news and in newspapers and magazine articles:
High cholesterol, smoking, chewing tobacco, diabetes, being overweight, HIV, and other illnesses and diseases related to poor health and causing early death.
In considering these risks, the life insurance company selects a grade or status relating to your health. These ratings include: Preferred risk, Standard risk, Super Preferred risk, among others.
These health ratings are based on your gender, health and age. These ratings also determine the rate or premium you will pay for your life insurance policy.
Obviously, the better health you are in, the lower your rate would be compared to the person (the same age) in average or poor health. That’s because you have a lower chance of dying prematurely.
Several risk factors considered in determining your insurance premiums are not in your control. Those factors include your gender and your age.
National Underwriting Studies show that because women tend to live longer than men, women pay less for the same amount of life insurance as men.
Your age also has an effect on how much you pay for life insurance. The older you are the more likely you are to die, so you pay more for a new life insurance policy at an older age, than a younger person.
Your lifestyle (risky hobbies or frequent travel to high risk areas with disease or war), your family medical history, and your physical health are key factors in determining your life insurance premium. The greater the risk for each of these factors, the higher your premium.
Usually, the insurance company will ask about your health and require you to take a medical exam. They’ll check your height, weight, blood pressure, vital signs, and take blood and urine samples. Blood and urine are checked for disease, including HIV, hepatitis, high cholesterol, cancer, kidney problems, diabetes and other health problems. Also, screening for nicotine, medications and illegal drugs are performed.
Each life insurance carrier sets its own life insurance rates and decides what individuals fit into the preferred, super-preferred and standard risk classes for rating purposes. If you do have a special health risk there are insurance companies that specialize in offering life insurance for specific health problems.
If you have a health problem you can address it: Stop smoking, take medication or lose weight. Start eating better. You can improve your health and lower your life insurance premiums.
If you give evidence of considerably improved health to your life insurance company, they may decrease your life insurance premiums. Keep this in mind.
Some life insurance companies will change your risk rating and lower your insurance premiums if your risk factors get better over time.
It pays to improve your health. You live longer and you pay less for your life insurance.
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