Life Insurance Rates

Life insurance rates are based on certain criteria such as age, gender and overall health. To determine your health status, the insurance company may require the insured to undergo a physical exam.

Insurance is about managing risks, and when it comes to risk, insurance companies want to minimize the risk they take insuring people’s lives. Insurance companies want to make sure they do not have to pay out more than the insured pay’s into the system.

To account for the risks, the insurance companies will assign each insured a status when setting life insurance rates. The status is based on some of the criteria used including age, gender and health. Your status will determine how much the insured will pay for a given amount of insurance.

When applying for health insurance, the life insurance candidate will fill out a questionnaire. It is imperative the questionnaire is filled out honestly. If the insurance company finds out the insured was less than truthful, they could cancel the policy. If the insured dies and the company find outs the insured were less than truthful, benefits may be denied. If benefits were paid out and the insurance company finds out the insured was less than honest, the insurance company may wish to recoup their payments from the family and beneficiary of the deceased.

There are a few risks that cannot be controlled including gender and age. Women live longer than men, so women have lower life insurance rates. On the other hand, for an annuity, men pay a lower rate because they have a shorter life span. Since young people have more time to pay into the life insurance system, their premiums will be lower than someone who is older and buying life insurance. Family medical history, as well as, the level of stress of employment and the level of danger involved with hobbies will also be used to determine life insurance rates. The frequency of travel is also used as a determining factor for life insurance rates.

Life insurance candidates are sometimes asked to submit to a general medical evaluation at the life insurance company’s expense. A typical exam will include weight and blood pressure check and perhaps a urine or blood sample for analysis. The samples will be tested for any sign of disease including diabetes, kidney and hepatitis problems, cholesterol level, HIV to name but a few. The samples may also be checked for nicotine and certain medications that may signify health issues, as well as, the use or abuse of illegal and prescription drugs.

Your life insurance rates will be set according to the outcome of the tests and the medical exam as you will be categorized accordingly. If you know you have a risk factor, let your insurance agent know what it is. Some insurance companies hike their premiums if a particular condition is present. Your insurance agent can look for a company that does not raise rates much or at all for your particular condition. If the risk factor is something controllable, such as lose weight or quit smoking, why not do what it takes to minimize or eliminate that condition?