We’ve all heard the sanitized saying “life happens.” Well so does death, but most of us dread even the thought of it, so we push talk of it aside. When it comes to life insurance, we often leave that up to signing up for it through our employer which is usually a great rate, or decide we’ll do that when we’re older. But waiting too long is one way to ensure you will pay more for coverage. We did some digging and to find factors that will increase how much you pay for life insurance.
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Here are five factors that could pump up your premiums:
A smoker will pay 100 to 300% more for term life insurance according to the nonprofit Life Foundation. Using the SmartAsset Life Insurance Policy Comparison tool, the difference is clear. With everything else staying the same, a 45 year old non-smoking male will pay about $53 dollars a month for a $500,000 20-year term life policy, while his smoking counterpart will pay… wait for it, wait for it, a whopping $223 each month. This is for the exact same coverage! By quitting smoking you can decrease your monthly premium significantly.
Maybe you want life insurance coverage until you retire. Generally, the earlier you purchase life insurance, the lower your monthly premiums will be for the entire term of the coverage. This means that a 35-year-old buying 30 years of coverage will usually pay less per month than a 45-year-old and sometimes even comes close to paying the same amount overall. Effectively, that 35-year-old is getting an extra 10 years of coverage almost for no additional price.
LLG Wealth Management and Planning provides insight into just how much your weight weighs on how much your pay for life insurance. In fact, they break it down like a fraction. The company says being overweight is one of the most common reasons why people are declined or charged higher rates when it comes to buying life insurance. Your height/weight ratio is used by life insurance companies and their underwriters to determine the premiums for your life insurance policy. This is based on the fact that LLG determines a person who is 25% overweight has a 25% greater chance of dying at any given age than someone who is not overweight.
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Your health obviously will play a role in whether you can get coverage and how much you will pay for a life insurance policy. Chronic conditions such as high blood pressure, diabetes, asthma etc. can make it more difficult and more expensive to get coverage. If these conditions are not under control they can make it impossible for you to get coverage. Insurance experts agree that if you have a chronic condition you can find coverage if you can demonstrate you have it under control, often with the assistance of medication.
I like to think of this as the Viva La Vida or Live Life factor. You remember when you first heard Coldplay’s Viva La Vida and how you felt so empowered and ready to take on anything. Then you saw the video and felt a sense of loss or a fall from grace. Well, not as poetic but true when it comes to getting life insurance for risk takers.
It is hard to debate the fact that insurance companies believe those who engage in risky hobbies or sports could be putting their lives in danger. So if you are a hang-gliding, rock climbing, parachuting, car racing, bike racing, surfing, skiing, white water rafting kind of person, you may have to pay a higher rate for life insurance. If you think about not telling them when you get your policy, they will surely find out should you die doing your hobby or sport. Your lack of disclosure could be grounds for the company to void your policy.
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