That is an excellent question! There are a lot of things that determine your cost for the policy. The biggest are your gender, age, smoking preference, and health status. Add to that the size of the policy desired, your medical history and prescription history; where you live and what you do for a living; your family medical history; and the company's costs, overhead, and profit taking. Then picture your policy like a fitted jacket. It will fit you, but not anyone else. Your rate is like that - there are very few "one size fits all" rate plans out there ( and I'd personally probably stay away from any one of them that I found...). A good independent agent ( one not tied to a specific brand name) can help you with several quotes to find the policy that fits you best. Thank you for asking!
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
Actuaries are people who study statistics. They can track the life expectance of a 35 year old male, living on the shady side of the street, who has red hair and is over 6 feet tall. However, what the actually do is develop statistics that show the life expectancy of a 35 year old male who is “average” or “standard.” They also develop statistics that show the effect of varying levels of hypertension or obesity and from this information they develop “substandard rates.” The process of underwriting is to see if you fit into a “standard” mold, “substandard mold” or a “preferred mold.” Of course you might not qualify for any mold at all.
There are a lot of factors considered when rating premiums on a life insurance policy. Think of an actuary as the pit boss at a casino, they rarely lose. They consider numerous factors and can basically pin point your death year. Once they know that information, they set your premiums based on how long you wish to guarantee the rate. That is why a 10 year term life insurance policy is so much cheaper than a 30 year term policy which is cheaper than a whole life policy.
You want to purchase as much life insurance as you can for as long as you can while you are young and healthy. The older and sicker we get, the more expensive life insurance premiums will become.
That is why when you apply for a fully underwritten life policy they want to know your sex, age, martial status, health status, life style, occupation, residence, net worth, etc. etc.
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You want to purchase as much life insurance as you can for as long as you can while you are young and healthy. The older and sicker we get, the more expensive life insurance premiums will become.
That is why when you apply for a fully underwritten life policy they want to know your sex, age, martial status, health status, life style, occupation, residence, net worth, etc. etc.