How Your Lifestyle Affects Your Life Insurance Premiums
Some health conditions, your lifestyle and activities you take part in can increase your life insurance premiums. Some even disqualify you from certain insurance plans.
In this article, we will discuss some of the health risks and lifestyle choices that affect your insurance rates.
Life insurance is based primarily on your age and on your health. There are other considerations the insurance companies use to calculate your premium, or even if they accept you for coverage.
Age is the number one factor in how insurance companies base their premiums. So the younger you are the less your going to pay than waiting to get the insurance started when you are older. As you age health conditions could arise that could disqualify you for good rates. So as a general rule it is usually better to get life insurance started at a younger age.
According to history, women live longer than men so insurance rates are usually cheaper for women than they are for men.
Insurance companies look at your current health and your health history. If you are a smoker there are certain illnesses and diseases that you will be at a higher risk for than non-smokers. So your rates will be higher based on the fact you are a smoker.
Some of those diseases are: high blood pressure, lung cancer and other chronic lung diseases. If the insurance company chooses to do blood and urine tests a nicotine test will be included to determine if you are a smoker. If there is nicotine present, you will be charged the higher smoker rate. Contact your life insurance professional if you quit smoking. He can check to see if you qualify for the option of upgrading to the non-smoker rate. If you haven’t smoked for a year this usually is a good option to save you money.
Depending on the type of insurance you apply for, some insurance companies need medical records and a report from your doctor. Some even require a current blood and urine test and will send a nurse to your home to collect these specimens. The insurance company is looking for high risk health factors such as: elevated sugar levels which is a risk for diabetes, elevated liver enzymes, high cholesterol, high blood pressure plus a few more indicators for potential diseases. Since these tests are the most recent, they will most likely be the deciding factor on the type of premium you qualify for.
With the blood and urine tests there is also consideration of elevated liver enzymes. Which is a risk because they can show possible heavy alcohol use. Which can take a toll on your health. If there are elevated liver enzymes they consider this a high risk and either raise your rate or decline you coverage.
Other factors they look at is a family history of hereditary diseases and illnesses. You may not have any health issues and your tests come back clear, but a family history of hereditary diseases can increase the cost of your coverage because of a higher risk profile. Some conditions they look at are: a parent died at an early age from cancer, sickle cell anemia, or other serious diseases.
Being obese has risk factors that the insurance companies look at because the negative effect obesity has on your body. The ways obesity effects your body are: increased risk of severe high blood pressure which increases risk of heart attacks or stroke. Your insurance professional has a weight chart and guideline that he must follow to determine your insurance rate.
Other life threatening illnesses such as diabetes, increase your health risk because of the complications you get such as neuropathy. High cholesterol has been shown by some studies to be a factor as a risk for heart disease so the insurance companies look at cholesterol levels when considering your rates.
Most insurance companies look at your lifestyle habits such as your driving record. If you have a high number of traffic violations such as speeding tickets, accidents, DUI’s, or other such risky driving behaviors they have the right to raise your rate or to decline you coverage. Besides to your driving record the insurance company looks to see if you have been convicted of a felony charge. If so, your risk is so high most insurance companies will not even consider you for coverage even at an increased premium.
Life insurance companies also look at your credit history to determine your rate. Some will not even accept you for coverage if your credit rating is bad. With smaller life insurance coverage amounts such as $10,000 or below it is less of an issue unless you are currently in the middle of bankruptcy proceedings. If you are applying for larger amounts of coverage such as $50,000, $100,000 or more, your credit rating is more of a consideration. Then they look at the total credit rating, charge offs, foreclosures and accounts in collections to determine your rate.
If you have a job that is considered extremely dangerous the insurance company can insure you at a higher rate or not agree to approve you for coverage. Some of the jobs would be those that people are daily putting their life on the line. Some of these jobs are: active military, airline pilots, deep sea divers, police, firefighters, electrical power line installers, structural iron and steel workers. This is by no means a complete list but gives you an idea of what they insurance companies look at. Each company has their own list of what they do or do not accept so it is always best to consult with your insurance professional.
In addition to the dangerous jobs there are dangerous hobbies or sports that you take part in that could affect your insurance premium. Some of those are: mountain climbing, ice climbing, repelling, hang gliding, deep sea diving, and big game hunting. If you travel to areas of the world where there is a high risk of getting a deadly illness or you go to war zone regions some companies consider these activities too high of a risk and can even refuse you coverage. Again consult with your insurance professional if you take part in any type of extreme sport.
There are some prescription medications that affect your insurance premiums and even some companies will not even cover you. Some of the drugs that can cause an immediate decline are those taken for dementia and Alzheimer’s. Others that can raise your rating or be a possible decline are blood thinners, multiple drugs for uncontrolled high blood pressure, uncontrolled diabetes with complications, current cancer drugs or treatments, oxygen use, liver damage and kidney dialysis. Multiple medications for mental disorders or severe conditions of depression or schizophrenia can cause an increase in rates or even a decline based on the severity of the condition because of the high risk of suicide. Recreational drugs that you are taking are a risk so not one that the insurance company would be willing to take in almost all if not cases.
Now that we have looked at the risk factors that influence your rate let us look at the amount of coverage you are applying for and your needs. The amount of coverage you wish to get most certainly will effect the amount of your insurance premium.
Questions you may ask to determine the amount of coverage you are applying for are:
– Are you looking to cover only a basic funeral and burial expenses?
– Are you the primary bread winner?
– Do you have a spouse and young children that would need shelter and a means to replace the loss of your income?
– Do you have financial responsibilities such as house payment, auto payment, and other expenses such as medical care that your spouse or other family members would be responsible for?
– Would you want to leave money for an educational fund for your children or grandchildren? Is there a favorite charity, church or other organization you would like to support even after your death?
The type of insurance coverage you apply for will also determine your rate. There are different types of policies such as term, whole life, and universal life policies for you to choose from. Among the term polices there are different term lengths such as 10 year, 15 year, 20 and 30 year terms. Some polices have living benefits such as critical illness riders, unemployment riders, child riders and many other options that will change the rate the insurance company will charge .
As you can see from the information presented there are many factors that have to dealt with when applying for insurance coverage. The best way to find a plan that fits all your needs and your lifestyle and with the best rate is to contact your life insurance professional.
Your Lifestyle plays a major role in your Life Insurance Premiums. How? Although you exercise regularly, eat right and never smoke you could still be in danger of being a “high risk” to insurers. You might not realize, but if you’re a frequent flyer or avid adventure sports person who spends a lot of time sky diving, you are at the risk of paying a very high rate when you buy your life insurance. Many people only think they are high risk if they have had a history of heart disease, or kidney disease which is not the case. So your lifestyle could actually raise the expenditures of your life insurance policy. To understand why, you need to figure out how term-life policies are priced.
Life insurance companies study risks by dividing people into groups of smokers and nonsmokers. Some companies consider a person who uses any form of tobacco to be a smoker. These two groups are further broken down into one of three risk categories: Preferred Plus, Preferred or Standard. People who are considered with a greater risk of early death are under even lower classifications by life insurance companies..
Be Careful…
It might seem easy to get away with not disclosing your dangerous hobbies or family health history on your life insurance application but you only end up being the loser. For if happen to die in an accident related to the sport, and the company discovers that you participated in this avocation before you signed the paper work; it won’t pay your benefit. So make sure you don’t o give them a reason not to pay the insurance claim. But don’t be discouraged as you can always apply for a new life insurance policy.
So make sure you clean up your driving record, and be your health in good form to get a lower insurance premium from your insurance company .
As principal licensed life insurance agent Bennett Bier has helped 1000’s of people purchase life insurance online & over the phone. During his career he has become the go to expert for securing hard to place term and permanent life insurance policies for clients across the nation. With his wealth of knowledge of each life insurance carrier’s products and underwriting he provides honest answers and advice to every client. Bennett Bier and his team will work tirelessly to successfully secure the coverage your family deserves.
All content on this site has been written by life insurance experts & licensed life insurance agents.