You might never have really thought about what it takes to qualify for a life
insurance policy or what affects the premiums you pay. By the time you get
around to figuring it out it could be too late. Here are the most important
factors that go into determining what you will pay for your life insurance
coverage as well as whether or not you will even qualify.
The older you are, the more you will pay for life insurance. When you take
out a policy at a younger age, the company expects that you will be paying
the premiums for a much longer time period, and therefore your monthly
payments will be smaller. The older you get, the shorter the time period
during which they can expect to receive payments from you. This means
they will increase the premiums accordingly. Your age also has an impact on
your health. The older you are the more likely it becomes that you will
develop a serious health condition that could make it even more likely the
company will pay out on the policy.
Everything about your health will be taken into consideration when you apply
for a policy. Most companies will require at least a questionnaire filled out, if
not a visit from a doctor or nurse to check up on your overall health. This
includes things like your weight to height ratio to determine if you are
overweight, blood tests to check cholesterol and look for serious illness, and
sometimes more. They will ask about your lifestyle as well as smoking, drug,
and alcohol use. Even what seems like a minor health issue can result in a
higher premium amount, because it could develop into something more
serious later on.
Your Occupation And Hobbies
If you have a dangerous occupation such as a firefighter, or engage in
potentially dangerous activities like certain sports, this can affect your
eligibility for life insurance as well as your premiums. When you put your life
in danger either at work or at play, the insurance company sees a higher risk
of paying out on the policy. In some cases they may deny you altogether
simply based on the activities you engage in regularly.
These are some of the major factors leading to insurance company decisions
regarding life insurance premiums and whether or not you qualify. Some of
them can’t be changed, while others can—and you should take them all into
consideration if you want to get the best rate on your policy.