How age affects life insurance premiums

How Your Age Affects Your Life Insurance Premiums

black and white image of back tattoo with woman staring thinking about age life insurance

To assess applicants’ risk, life insurance companies collect information on that person’s risk factors. For example, sex, weight and health are some factors that may affect an applicant’s longevity.

So what’s the most important factor? The applicant’s age. Age is the single most important factor when it comes to determining an individual’s life expectancy and risk towards the insurance company.

Except for the first few years of life, resistance to disease and injury decreases with age while the probability of death increases.

Once an insurance company receives the applicant’s information, they will compare it to others their age. This process helps the company determine insurability and expected longevity.

Here’s an online calculator to determine your longevity.

Generally speaking the younger you’re, the less expensive life insurance is for you but that shouldn’t deter you from shopping around for the best policy at the best price that covers all of your life insurance needs. Follow this link to easily compare over 50 companies for free.

Unfortunately, younger individuals are less likely to think about life insurance as, statistically speaking, they have longer to live. However, securing life insurance when you’re young and healthy could be the best decision you could make. If you wait until you have a young family to protect, your debts are likely to be the highest.

Also, younger applicants are more likely to secure a lower life insurance premium. This is because insurance providers will likely collect premium payments for a longer period of time than someone who is older.

A similar rationale could be used to explain why older applicants will face high life insurance premiums.  Statistically speaking, they’re more likely to pass away from natural causes than a younger person. Older applicants are also more likely to develop poor health conditions and/or contract a fatal disease than younger applicants. Therefore, the insurer will collect less premium payments over their insurance period.

 

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