Factors That Affect Your Life Insurance Rate
Underwriting factors are those factors that affect the cost of your life insurance. To put it simply, the higher the risk involved, the higher your premium will be. These risk factors come in many different forms. They could be affected by age, health, occupation, past driving records and even dangerous hobbies, if applicable. The cost of a policy will also depend on the amount of the coverage as well as the period or term of the policy.
The greater the health risk, the higher the cost. Thus, the older you are the more expensive your policy will be. There are various categories that an insurance company will assign you to when applying for a policy. These could be labeled standard, preferred or preferred plus (might differ from company to company but the general qualifications remain more or less similar). Lower rates would apply to the preferred or preferred plus categories as these indicate that the individual has no serious health problems.
Major health conditions such as diabetes, cancer, heart disease, high blood pressure and high cholesterol levels all contribute to a higher risk factor. In case you have a history of alcohol or substance abuse or are a smoker, this could affect your final insurance rate as well. A family history of disease or being overweight can also affect what category you fall into. Ultimately, there are some health conditions that can be dealt with and changed while others are beyond your control. It is therefore necessary to choose the provider and insurance company carefully, in order to ensure the most affordable rate for your individual situation.
It is always preferable to understand what factors affect your life insurance premium so that you will make a more informed decision based on the multiple quotes you receive from your insurance provider. These would include:
A good agent or insurance provider is also important. An experienced agent/provider will understand the underwriting process and can explain the different terms and factors that will affect your quote. Always shop around as life insurance quotes can vary significantly. Compare rates and policies to determine which would be the best deal for you. All this will contribute towards making a well-informed decision that will safeguard the future of your family and loved ones.
The greater the health risk, the higher the cost. Thus, the older you are the more expensive your policy will be. There are various categories that an insurance company will assign you to when applying for a policy. These could be labeled standard, preferred or preferred plus (might differ from company to company but the general qualifications remain more or less similar). Lower rates would apply to the preferred or preferred plus categories as these indicate that the individual has no serious health problems.
Major health conditions such as diabetes, cancer, heart disease, high blood pressure and high cholesterol levels all contribute to a higher risk factor. In case you have a history of alcohol or substance abuse or are a smoker, this could affect your final insurance rate as well. A family history of disease or being overweight can also affect what category you fall into. Ultimately, there are some health conditions that can be dealt with and changed while others are beyond your control. It is therefore necessary to choose the provider and insurance company carefully, in order to ensure the most affordable rate for your individual situation.
It is always preferable to understand what factors affect your life insurance premium so that you will make a more informed decision based on the multiple quotes you receive from your insurance provider. These would include:
- Health factors More and more Americans now fall within the obese category. Obesity along with health issues such as cholesterol and blood pressure can lead to more life threatening problems. A slightly raised cholesterol level will not make much of a difference to your premium but high levels but a cholesterol problem along with blood pressure or obesity may increase your overall rates. Blood pressure can lead to heart disease and thus put you at a risk for higher life insurance. If you have had high blood pressure and successfully lowered it with medication, this should not affect your insurance rate. With regards to your height to weight ratio anything more than 30 pounds overweight would be cause for concern.
- Exercise If you exercise regularly (even for as little as 20 minutes a day), you will probably have fewer health issues and a lower probability for Type 2 diabetes. The insurance company would recognize the benefits of a daily exercise regime and this will in turn affect your final policy rate.
- Insurance company - Which insurance company you choose is very important with regards to how much you will be charged. Some companies specialize in high risk cases and can offer more affordable premiums as a result. The company will also determine which hospital and doctor you can go to.
A good agent or insurance provider is also important. An experienced agent/provider will understand the underwriting process and can explain the different terms and factors that will affect your quote. Always shop around as life insurance quotes can vary significantly. Compare rates and policies to determine which would be the best deal for you. All this will contribute towards making a well-informed decision that will safeguard the future of your family and loved ones.
