What Affects Life Insurance Premiums?
Life insurance premiums vary from company to company. If you compare the quotes from various companies, you may find large variations between them. These variations depend on a number of parameters which Health Insurance Coverage companies consider to analyze their profit margins.
A Common Health Policy Depends on Following Major Parameters:
1. Age Group of the Person to be Insured
Age group of a person is the first consideration for any insurance company while deciding insurance premiums. If a person is young, he would be most probably in healthy state and therefore, will have a probability of a longer life. Hence, an insurance company will get more profit with fewer expenses. On the contrary, an old person is more prone to diseases due to decreasing immunity in the body. Therefore, an insurance company will get fewer premiums and will have to pay a multiple in the form of life insurance cover. Therefore, companies look forward to higher insurance premiums for old people to match with their life insurance policy cover demands.
2. Hereditary Diseases
Hereditary diseases are those diseases which are associated with the genetic structure of your DNA and pass-on from one generation to another. These diseases reduce the probability of a longer life for a person. Therefore, health companies enquire in advance about any hereditary diseases and prepare special policies depending on the gravity of the particular disease.
Common life insurance policies do not cover the loss of life due to hereditary diseases and therefore refuse to pay for the life insurance cover when needed. Therefore, it is advisable to get life insurance policy of specific kind, if you have a hereditary disease.
3. Previous Health Track Record
If you want a lower Premium for your life insurance policy, then you must take care of your health. A good health track record builds confidence of the insurance companies in you. Thus, companies readily provide efficient insurance policies at much lower premiums.
4. Present State of Health
Almost all life insurance companies go for a pre medical examination of the insured to assess his medical condition and accordingly suggest a suitable insurance policy.
Again, if his present state of health is normal, the premium will be lower and vice-versa.
5. Required Health Insurance Benefits
Your desired life insurance coverage is also a very important consideration determining the real cost of the required policy. If you are looking toward a higher amount of life insurance coverage, it’s quite obvious that you will have to shell out more money. Similarly, for lower level of benefits, low premiums plans are available.
6. Addiction to Alcohol and Drugs
Life insurance policies remain dear to the alcohol and drug addicts. Drugs and alcohol has become an important cause of thousands of deaths every day. Therefore, looking at the statics, life insurance companies cover their Risk of monetary loss by preparing costly life insurance policies. If you are addicted to drugs and look forward to get life insurance policy at an affordable rate then you must immediately get in touch with a drug rehabilitation center. Once you are again in the normal state of health, you will be eligible for low premium policies.
These parameters are a few of the extensive list considered by most of the life insurance companies. However, these are the most detrimental parameters in relation to the formation of a new life insurance coverage policy. For a better insight into the world of life insurance benefits and policies, it would be a worthy decision to get in touch with a professional life insurance consultant.