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Understanding Life Insurance Costs

A number of different factors can affect how much your life insurance policy might cost. Life insurance rates are primarily determined by your age, your health, the type of policy you buy and the amount of coverage you want, but there are other aspects that can determine the cost of your premiums.

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What Affects Life Insurance Rates?

Here are 15 factors can affect your life insurance costs.

1. The Policy Type You Choose

There are two primary types of life insurance. Term life insurance policies can provide benefits coverage for a specific period of time. If you buy a term life insurance plan and die during the policy term, then your beneficiary will be paid your benefit payment. Permanent life insurance plans can provide benefits coverage for the remainder of your life, provided you pay your premiums on time and in full. Premiums for permanent life insurance policies are typically higher than for term.

2. Your Coverage Amount

The higher your death benefit (the amount that your policy pays out to your beneficiaries), the more you’ll pay for coverage.

3. The Policy Length

Because insurance companies are less likely to have to pay out on a shorter term policy, those term policies typically have less expensive premiums. Average policy costs can range from $568 per year for a 10 year term policy, compared to $1,528 per year for a 30-year term policy.

4. Your Age

The younger you are, the lower your premium rate will typically be. Waiting until later in life to buy a life insurance policy could drive up the cost of your premiums.

5. Your Gender

Women have a higher average life expectancy than men. Women may pay less for life insurance compared to a man of the same age, health and risk factors.

6. Your Current Health

Some policies require that you take a medical exam before buying a policy. The exam will test for things such as high blood pressure, high cholesterol, diabetes and other potential health risk factors. People in good health generally see lower life insurance rates, because they’re less likely to develop future complications.

7. Your Health History

If you have ongoing health issues or a history of chronic illness, your life insurance cost may be higher.

8. Your Weight

There are many health risks associated with carrying excess weight. If you are overweight or obese, you may pay more for your life insurance coverage.

9. Whether You Smoke

This particular risky health habit can dramatically impact the cost of your life insurance coverage. Smokers can expect to pay 3 to 4 times as much for life insurance than nonsmokers.

10. Whether You Drink

Alcohol abuse and heavy drinking can lead to medical conditions that affect life insurance rates. If you drink excessively, you’ll likely pay more for coverage.

11. Your Family History Of Disease

Those with a family history of disease or chronic illness (such as heart attack, stroke, diabetes or other conditions) may pay more in policy premiums.

12. Occupational Risks

If insurance companies classify your job as risky or dangerous, it may result in an increase in rates or even a denial of coverage.

13. If You Travel Often

Frequent travel and trips to areas of the world that might be unsafe can both affect your life insurance costs. Insurance companies will each treat this factor differently, so be sure to ask when buying your policy if you think your travel plans could have a potential effect.

14. Hazardous Hobbies

High-risk hobbies (skiing, skydiving, surfing, car/bike/boat racing, etc.) and other adventurous lifestyle activities may also affect what you pay for life insurance. If your insurance company perceives your hobbies as dangerous, it may also have an effect on your insurability.

15. Your Driving Record

Safe drivers with a clean record typically pay less for life insurance policies than drivers who have a history of multiple violations or traffic accidents.

Finding a Life Insurance Policy That Fits Your Needs

To find out what a life insurance policy may cost you, call 1-855-303-4640 to speak with a licensed insurance agent.


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Applications for life insurance may be subject to acceptance by insurer. Issuance of the policy may depend upon answers to health questions. Rates and coverage amounts depend upon the carrier selected. Your policy may be subject to underwriting approval. You will receive only the benefit amount in the policy issued.

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