If you’ve gotten insurance policies in the past, you are no doubt aware that a number of factors are taken into consideration when determining your rates. Homeowners insurance, for example, may be based on the value of your home, the crime rates in your area, and the deductible you select. Auto insurance could be calculated by looking at the car you own, your driving history, and even the number of miles you put on your vehicle in a year. So it should come as no surprise that the rates attached to your life insurance policy will be determined based on a variety of input. But you may not be aware of exactly what insurance providers are interested in and how they come up with a number for your particular policy. Here are just a few of the factors they consider and how they could affect your life insurance rates.
Age
Your age will play a major role in the cost of your life insurance policy, and unfortunately, there’s not much you can do about it. Just like taxes, death is inevitable, and the longer you live, the greater the odds you will die. Luckily, you can lock in low rates for life insurance by selecting a whole life policy when you’re young and sticking with it. The younger you are when you secure your policy, the lower your cost will be. Just make sure to pick a policy that has rates locked in.