Calculating Life Insurance Premiums

Published in All Insurance Industry Insights on Monday, June 13, 2022

Life insurance premiums are calculated after looking at an individual’s health risk factors, such as tobacco use, cholesterol level, obesity, diabetes and family history of underlying medical conditions. While some aspects of your life insurance expenses are out of your control, modifying certain lifestyle factors can help reduce your premium, in addition to making you healthier. Keep reading to learn more about how life insurance premiums are calculated and what you can do to lower yours.

Applying for Life Insurance

When applying for life insurance, you will be asked to provide information about your medical history and take a physical examination.

If you are not completely truthful about your medical history, you may lose your policy or, when you die, your dependents may be denied benefits. Therefore, you must tell the truth throughout this process.

In regards to the examination process, a medical professional hired by the insurance company will typically conduct the exam. This person will check your weight, blood pressure and other vital signs that indicate your current health status.

Understanding Your Premium

After the application process, the insurance company will determine your premium. Keep in mind that there are lifestyle habits that you can alter to lower your premium. For instance, you could:

  • Stop smoking
  • Avoid drinking excess alcohol
  • Lose weight by maintaining a balanced diet and getting routine exercise
  • Improve your cholesterol levels
  • Take any necessary medications regularly

If you have taken the steps to improve controllable health risks since obtaining your life insurance policy, contact your PDCM agent to discuss lowering your premium.

Take Your Health Seriously

Don’t ignore the importance of living a healthy lifestyle. Eating balanced meals, exercising regularly and quitting unhealthy habits can all help you avoid experiencing preventable complications (e.g., smoking-related asthma)—all while lowering your life insurance costs in the process. For additional lifestyle and well-being guidance, contact us today.