The older you get, the more premium you pay for buying life insurance. So it is better to buy a life insurance plan before your next birthday and save money on premium paid.
Are you thinking of buying a new life insurance plan? Before you make any commitment regarding the same, it is essential to understand the annual premium concept of the desired life insurance plan. Yes, there are different choices available in the market that come under life insurance plans; one example being a term plan.
In all the life insurance plans, the annual premiums are influenced by numerous factors such as health, gender, hobbies, height, weight, occupation among others. You must be aware that the premium rate varies from plan to plan and from one company to another.
If you are thinking about a whole life policy, then the rate of return on the cash value can also affect the premium rates.
Industry experts are also of the view that age plays a vital role in the process of setting premiums in the term and whole life insurance plans.
The age aspect
The annual premium rates of life insurance policies depend upon the age of the person at the time of purchase and duration of the policy. The premium rates increases by 8 to 10 per cent every year because of the growing age. As per expert estimates, the premium amount increases by 5 to 8 per cent in the 40s and if the policyholder is over the age of 50 years then the same will increase by 9 to 12 per cent every year.
It is advisable to buy a life insurance plan at an early age as it helps in reducing premium rates and bring steadiness to it. However, throughout the life insurance tenure, the premium rates do rise with age.
The rates of premium are determined by the insurer each year, depending on the actuarial tables of the book-keeper and they increase at each consecutive age because each year there is a superior drain on the cash value, attributed to the increased mortality charges.
How does age help in getting life insurance plan?
According to insurance experts, the age factor is an essential part as it helps in checking the eligibility of the person buying a life insurance plan. An older person has limited options of life insurance plans. There are many tests that an older person has to pass for buying a desired life insurance policy like medical tests, etc.
The premium rates will be higher for an old age person.
Basically, older age implies that a person is more vulnerable to health risks and chances of mortality are high in case of any critical disease, hence the insurance companies like to play it safe by increasing the premium amount for an old age person. So, in short, buying an insurance plan at an early stage can make things quite easier for you.
The premium rates of any life insurance plan will increase over the year and that can have an impact on your savings. So it is better to buy a life insurance plan before your next birthday as it will surely make things quite easier for you.
Buying a life insurance plan at an early age will give you the best coverage at low premium rates. It is advisable to get free quotes of two or more life insurance companies that will help you in getting the best life insurance plan easily. You must consider online insurance web aggregators for the same as they offer the facility of comparing policies from different companies, thereby ensuring that you get the best product at the most reasonable price.
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