Factors That Impact Life Insurance Premiums

Different factors will determine what you pay for life insurance premiums. This can confuse many individuals when they are trying to understand why their premiums are higher than others. Below are some factors that can impact the cost of life insurance and perhaps take some of the confusion out of it.

Factors that Determine your Life Insurance Rates

Once you decide on a particular life insurance policy that suits your needs, the next step is learning the factors that will determine if you qualify and how much you will pay for the premium.

Your Age

The strongest factor many insurance companies start with to determine your rate is your age. Your premium will be lower the younger you are. This is because they assume you have many years of paying on the premium before you pass away.

Your Gender

The next factor they look at after your age is your gender. There are statistical models that some insurance providers use to approximate your longevity. For instance, on average, women have a life expectancy of about five years longer than men. Therefore, their rates are a bit lower since they are anticipated to live a longer period than men.


Because you put yourself at a higher risk of health problems when you smoke, it is an automatic red flag for most insurance providers. If you smoke, you can even expect to pay as much as twice the premium as non-smokers with the same or comparable coverage. By kicking the habit, you can — and probably will — lower your rates.

Your Health and Family History

Another essential deciding factor in how much your premiums will be is your medical and family history. If you have any chronic conditions or potential for one, your rates could increase. Also, if you have a family history of certain illnesses, your rate could also be high.

Your Current Health

Most insurance companies will have you go through a medical examination so they can see if you have any types of health issues that could cause problems in the future. If you are in good health, you will most likely enjoy a lower rate.

Your Weight

This is also a factor. Since obesity, for instance, can cause health problems and a shorter lifespan, this could affect your premium.

Your Occupation

Another thing insurance companies look for is if you hold a dangerous job, such as a coal miner, race car driver, or you work in any profession that can cause accidents. Although rare, the insurer might consider some occupations to be too risky due to their high potential of causing an accidental death and might not give you coverage.

Your Lifestyle

Your lifestyle activities are accounted for as well. If you are a thrill seeker and like to climb mountains, sky dive, or bungee jump off of high bridges, you could end up paying higher rates for life insurance. Thrill seekers are a major concern for many insurance companies since their lifestyle could lead to their early end.

The insurance company will weigh in these and other factors to determine what you will pay out in premiums for your policy. The importance that each company weighs on them could be different and will depend on your insurance provider. It is important that you sit down and discuss your lifestyle and other factors with your insurance agent to take out a policy that will best fit your specific needs.