Before you start looking into any type of life insurance, it’s good to do your research. You should have a good idea of what to expect. It’s smart to figure out what you will be getting with a policy, how much you will be paying, and what’s going to influence those costs.
Knowing these things can help you to be prepared for the costs. You can then compare rates between different companies and policies. This is a good way to know what’s a reasonable price and what isn’t. You will quickly learn which insurance policy is best based on the price.
Factors That Influence Rates
There are lots of different factors that influence the price you will end up paying on your insurance. It’s helpful to know these factors so that you can better estimate the price you’ll be paying. Plus, you can also become aware of which factors may be raising your insurance rates.
Because there are so many factors, don’t expect to be paying the same rate as someone else you know. These can change from person to person based on your health, age, and more. Let’s get into some of these factors next.
Insurance companies know that you are less likely to pass away when you are young. Because of this, they are going to charge you less. You will pay the insurance company a good amount of money for a while, which is what they are likely hoping for. For this reason, you may want to get a life insurance policy fairly early on to prevent higher costs later on. If you wait too long, you will experience much higher rates.
If you smoke, you’re putting yourself at risk for a number of different health concerns. Insurance companies are well aware of this so they are going to charge you quite a bit more. Some of these rates can be double or triple those of non-smokers. If you’re in the position to stop smoking before you get life insurance, consider giving it a go. Of course, sometimes this just isn’t an option. Be prepared to pay more if you can’t quit your habit.
When you get life insurance, you will also get a medical exam in most cases. You may choose to forgo the exam, but that will hike your rate up a ton. A medical exam is necessary so the life insurance company knows how risky it is to insure you. This medical exam typically includes:
- Height and weight measurements
- Blood pressure
There may be other components depending on the company. If you do have a serious health condition, make sure that you’re medicated for it prior to getting a medical exam.
Since women generally live five years longer than men do, life insurance companies insure women for less money. This is typical across the board. Based on different statistics, life insurance companies look at how long people live based on this and the other factors mentioned. Since women live longer, life insurance companies see women as less risky for being insured.
Depending on how wild you like to live your life, you might have to pay more for your life insurance. If you’re involved in riskier activities, you’re risking your health. This is why a life insurance company would be concerned. People like professional fighters or mountain climbers might have a hard time getting a low rate. Even if you do these things for fun, you may have to pay more. This can also be connected to your job too. If you’re in transportation or construction, you’re putting yourself at a higher risk of becoming injured or worse.
If your family members have a history of serious health conditions, you’re likely going to be paying for it. This is a common question that will be addressed at the medical exam. These health conditions might include things like strokes, cancer, or heart disease. Anything that you could be at risk for developing is a concern for a life insurance company. They know that you could have that condition and pass away sooner because of it. The cost increase will likely vary from one company to the next.
Which Type of Life Insurance Offers the Lowest Rates?
Considering all of these factors, you might think that it will be hard to get a reasonable rate. This isn’t always the case. Part of it is about getting the right type of life insurance. Different types of life insurance have their own unique rates. Some are naturally going to cost more.
Your best bet is term life insurance. This is where you purchase life insurance for a designated term, such as 10, 15, or 20 years. With term life insurance, you only purchase life insurance for the number of years you will need it. For most people, this is when they will have kids, or dependents, at home. This is why you would get life insurance for just 10 or 20 years, depending on when you get it.
Term life insurance is a good idea for almost everyone, aside from a few exceptions. Most likely, you will be great with term life insurance. If you aren’t sure if term life insurance will work for you, you should talk to an independent life insurance agent. They can give you some unbiased details on term life insurance and your other options.
Term life insurance is the best deal. Not only does it give you everything that you could need, but it comes at a reasonable rate. You don’t have to worry about being overcharged or buying more than you will end up using. Some people think that getting more life insurance than needed is a good idea for some extra protection. In reality, it’s simply a better idea to get the right amount for the duration of time you will need it. There’s no reason to over-insure yourself.
Just because term life insurance gives you the lowest rates doesn’t mean that it’s not a good type of life insurance. You will still get the coverage that you need, but you won’t be paying for anything more than that. Term life insurance is affordable, but it gives you exactly what you’re looking for.
Sample Term Life Insurance Rates
Looking at term life insurance rates can help to give you a good idea of what you might end up paying. This will also help you to pick up on both good deals and the ones that aren’t so great.
Here are some sample rates to look at. They are all calculated for a 10-year term life insurance policy for a male and include $500K coverage. There will be variations for health concerns, gender, and more so keep that in mind.
500K Term Life Insurance Quote for 30-Year-Old
For a 30-year-old who isn’t a smoker, term life insurance is about $28 per month. This is very doable for many people since it’s only a small percentage of their income. For the coverage you’re getting, the $28 per month is worth it.
If you’re 30 years old and a smoker, you will pay $69 per month. This is a pretty decent jump from non-smoking to smoking. This is to be expected though since smokers have more health risks and life insurance companies know this.
500K Term Life Insurance Quote for 40-Year-Old
For a 40-year-old who isn’t a smoker, term life insurance costs around $43 per month. This is a pretty reasonable rate for almost any budget. Remember that you will still get $500K life insurance coverage with a low-priced term life insurance policy.
If you’re a 40-year-old smoker, you will pay an average of $123 per month. As mentioned before, smokers can expect to pay at least two times the price that non-smokers pay. Here, it is about three times the price.
500K Term Life Insurance Quote for 45-Year-Old
A 45-year-old who doesn’t smoke can expect to pay about $61 each month. This isn’t very much of an increase from what a 40-year-old would be paying. Fortunately, the rate from each age to the next is not too high, but it’s still something to think about.
If that same 45-year-old is a smoker, they will be paying about $188 per month. This is a significant increase for smokers, but it is very common among life insurance companies. This monthly cost is three times the price of what a non-smoker pays.
500K Term Life Insurance Quote for 50-Year-Old
If you are 50 years old and a non-smoker, you can plan on paying around $93 each month for term life insurance. This is a fairly significant jump from the price a 45-year-old non-smoker was paying. Still, the $93 per month is pretty affordable for most people. Keep in mind that you will be getting good coverage and everything that you need.
If you’re a smoker and 50 years old, you will pay about $274 per month. This is a high rate to pay each month compared to the non-smoking rate. This is also a pretty significant increase from the 45-year-old smoker rate too.
Term life insurance is the most affordable option when it comes to life insurance. You should be aware of the different factors that may change your rates so that you can know what to expect. It’s also a good idea to look at sample rates so you have a grasp on the possible rates you will be paying.
The good news is you’re in the right place. Here at CFAinsure, we represent some of the top companies on the market to make sure you get the lowest rate possible. We do all of the shopping for you, at no extra cost to you! If you want to see what life insurance will cost for you, simply run a quote using our multi-company life insurance quoter or give us a call today!