Whether you are an individual or a family, securing your finances must fall at the very top of your priority list. This is particularly true if you have any dependants relying on you as a financial provider. It is essential that in the event of your unfortunate demise, the financial concerns of your dependants, be they familial or professional, are looked after.
That is why it is recommended that every individual and family avail a life insurance policy that can help safeguard their futures and provide some much-needed peace of mind. However, one must consider that while a life insurance policy is a universal recommendation for all, the particulars of each policy differs from person to person.
Key Takeaways
|
Factor | Summary |
Age | Younger individuals typically pay lower premiums since they are perceived as lower risk compared to older individuals, who are more prone to health issues |
Gender | Women generally pay less than men for insurance before higher life expectancy |
Medical Records | The life insurance premium policy considers both past and present medical conditions to estimate potential future illnesses that may impact coverage |
Family History | A family history of serious illnesses like heart disease or cancer can affect premiums, as it suggests a higher likelihood of similar health issues in the policyholder |
Tobacco Use | Habits such as smoking, alcohol consumption, and high-risk activities can lead to higher premiums due to increased risk factors |
Policy Terms | Higher coverage amounts and longer policy terms often result in higher premiums as the insurer’s liability increases. |
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There are various features that differentiate one insurance policy from another, including the benefits provided by that specific insurer. But in particular, the premium amounts that a person pays towards his or her life insurance policy is dependant on a number of crucial factors. If you too would be interested in knowing how your life insurance premiums are determined, here is a comprehensive list of these factors:
The primary factor influencing the life insurance premiums of a policyholder is his or her age. From the perspective of the insurer, a young individual has a higher chance of continuing the life insurance policy for years to come. He or she is also less likely to suffer from an age-related disease and pass away prematurely. This makes them less of a liability for the insurer and hence, more likely to be eligible for low premiums. Hence, as a general rule, it is preferable to avail a life insurance policy as early on in your career as possible to avail the lowest premiums possible for you.
Another factor that determines the amount of your premiums is your gender. This factor is rooted in scientific and statistical evidence which states that women are likely to live an average of 5 years more than men [1]. This translates to women availing their policies for a longer tenure than men, and hence, as mentioned above, this means they can avail lower life insurance premiums.
Life insurance policies typically come with an underwriting process that includes conducting a thorough medical exam of the policyholder. The findings of this medical exam shed light on the status of your physical health and raise flags about potential illnesses you might contract in the future. Therefore, these medical records and their results also play a key part in determining the exact premium amount you will pay for your life insurance.
It is widely known that certain diseases are considered hereditary, which means that they have a tendency to run in the family. Other types of diseases might not be considered hereditary, but might have a higher chance of affecting members of a family due to common lifestyle choices. All of these risks are reflected in your family medical history, and also play a part in determining your life insurance premium amounts.
An important factor that most people might not consider when thinking about life insurance premiums, is an individual’s smoking habits. According to research, people who smoke are more likely to contract various illnesses and have a higher mortality rate as well. Hence, the term insurance premiums for smokers reflect these risk factors and tend to be higher than for their non-smoker counterparts.
Lastly but most importantly, a major factor in your life insurance premiums is the insurer from whom you opt to avail your policy in the first place. It is recommended to opt for an insurer that provides you extensive coverage at the most economical premium amounts.
This is made possible by Canara HSBC and the iSelect Smart360 Term Plan, which is one of the most reliable and affordable life insurance plans in the market. The benefits of this policy include a pure life coverage as well as various in-built benefits such as enhanced coverage with its child support, accidental death and accident & total disability benefits.
With the iSelect Smart360 Term Plan, you can also opt to secure your partner’s future by incorporating a Spouse Cover in your policy. Moreover, the iSelect Smart360 Term Plan by Canara HSBC comes with a customizable cover feature with which you can opt for level, increasing or decreasing coverage, as per your needs and goals.
When purchasing a life insurance policy, one crucial aspect to consider is the premium amount. Numerous factors affecting life insurance premiums should not be overlooked, as they impact the overall policy cost. Here are a few strategies to help reduce your premiums:
The primary goal of purchasing life insurance is to secure sufficient coverage that ensures financial stability for the future. However, many people mistakenly prioritise low premiums over adequate coverage, which can lead to complications when it comes time to settle a claim.
One common way to reduce life insurance premiums is by adjusting the sum assured. Striking a balance between affordability and adequate coverage is thus crucial. When considering a lower premium, think about key factors such as your remaining working years, the financial needs of your dependents, and your lifestyle requirements.
The earlier you buy the life insurance policy, the lower will be the premium you need to pay for the policy tenure. Individuals usually waiting for the right time or age usually pay a higher premium in comparison to those who buy at a young age. Thus, for those seeking to reduce term insurance premiums, this is the simplest and most effective path to financial security and peace of mind.
Some people tend to buy policies after seeing their ads or from the recommendations not realising their actual needs or comparing the policies offered by different insurance providers. Comparing different policies helps you find the plan that best aligns with your requirements. If affordability is a priority, it's important to evaluate the benefits offered by various plans in relation to their premiums.
Thus, by thoroughly reviewing the details of different policies, you'll be in a better position to choose a plan that helps reduce your term insurance premium while meeting your needs.
In today’s world, with countless policies available online, customisation has become a crucial feature. You can now easily add riders or coverage options to your policy for enhanced protection. However, it's important to note that these add-ons can raise the overall premium. To keep your insurance premium manageable, it's essential to select only the add-ons that are relevant to your needs and within your budget.
Purchasing insurance online is often more affordable than going through agents, as insurers save on commissions and distribution costs, passing those savings onto you. If you're looking for ways to lower your term plan premium, buying online is a smart choice. However, make sure to thoroughly review the policy details before making a decision. Plenty of resources are available to help you understand how to reduce your life insurance premiums.
We bring you a collection of popular Canara HSBC life insurance plans. Forget the dusty brochures and endless offline visits! Dive into the features of our top-selling online insurance plans and buy the one that meets your goals and requirements. You and your wallet will be thankful in the future as we brighten up your financial future with these plans.
Buying a life insurance policy online requires you to undergo a few easy and straightforward steps that are listed below:
Understanding the various factors affecting life insurance premiums is crucial in determining how much one will pay to their insurance provider. By understanding the various factors affecting risk in life insurance, individuals can seek strategies to lower their premiums while maintaining adequate coverage. Utilising tools like a life insurance calculator can help. It can offer precise estimates of premium rates, providing a clearer picture of the financial commitment involved. By proactively managing these elements, individuals can secure affordable and comprehensive life insurance policies.
The minimum age limit for term life insurance is 18 years. The upper age limit for obtaining a term insurance plan is 65 years.
Gender affects life insurance premiums as men often pay higher rates than women due to statistically shorter life expectancies and higher risk behaviours.
For term life insurance, the policy has a set term limit. Permanent life insurance is active until the policyholder passes away.
Yes, because if you're caught lying on a life insurance application, the insurer may decline your application for coverage.
Lying about smoking can result in your insurer cancelling or rescinding your policy.
Insurance companies get information about you through the insurance application form, where you provide the relevant information.
You can shop for life insurance by getting quoted premium prices from insurers. This can be done by providing basic information.
Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.
