Life insurance is one of most important investments. There are important lifestyle choices. That can have direct effect on your health and life insurance rates. Taking exercise and leading healthier lifestyle can have positive impact on your finances. Premium rates will vary according to age and gender. But see how to maintain good health and fitness.
Factors That Determine premium rates for Life Insurance Policy
Term Insurance product is large assessing risk based on life. And premium rates vary by gender and age. But there are other factors related to life style. Like drinking, smoking, medical history. Also, premium rates reflect target market experience. Thus it depends on income, city, education etc. To understand risk level past data will helps you.
What you can do to pay low premium?
You can maintain your health through regular exercise. Like avoid tobacco, right diet, alcohol use and reduce stress levels give you low premium rate. So, healthy life will attach at low premium rate. Some regular exercise can help to boost your health. This in turn can help to reduce cost of coverage such as life insurance.
But, it is important to get right premium for life based on fact disclosure. You must disclose all relevant information in proposal form. And it enables to assess risk and offer right premium for insurer. Protecting your family and their financial future is must. Thus you can see How to go for right annuity plan
Why premium rates differ from company to company?
Term plan covers age, occupation etc. But every insurer may target certain market section. On basis of its strengths, competitive landscape and brand association. So to keep past experience of such market target to determine product price.
Thus every product has certain criteria. Such as non-medical limit, low income, small amount, etc. You can save money on life insurance. Maintaining good health reduces your risk. And see what types of Life Insurance are?
And such pool exhibit different risk characteristics and price. This helps you to do price segment and avoid cross financial support. Every product will have different target and underwriting criteria. Hence, premium rates vary by product.
Why are premium rates high on Return of Premium Option?
Underwriting is like term plans. All things being equal there is no difference in pure term and return of premium term plans. But they are much more expensive than regular term plans.
In Term plan you will get sum assured in case of life assured death. And if life assured survive no benefit is pay. Hence, most of premium is use towards insurance close in pooled manner. But in term plan with return of premium option benefit is pay on either on death or survival of life assured.
It means, to provide insurance benefit certain premium amount is divide towards benefits. These benefits will pay In case life assured survives in policy term. Hence, return of premium option will come at an extra cost.
Finally, you can see term plan with return of premium LIC. And also see Term insurance with maturity benefit. But for more details check what are best term insurance plans. For better understand see what is best short term life insurance plans. Thus check importance of premium in insurance.