Are you wondering if you really need life insurance? The answer actually depends on your financial needs. If you are young and in good health, term life insurance is best for you. This is because insurance rates tend to be cheaper for younger people than older ones.
How Insurance Companies Classify their Insurance Applicants
Insurance providers want to know your risk level since this will determine the possibility of them shelling out money to pay out on your policy when you die. If you are risky to insure, they will have you paying higher premiums.
There are factors that insurance companies use in deciding your riskiness. These include your health and health history, which is why you may be required to undergo a medical exam. Also, they may consider your lifestyles such as substance use or your desire for risky adventures. They take this information to assign you a classification.
Reasons Age Does Matter
Term life insurance premiums are set for the policy’s term when you apply. Thus, when you apply while younger and perhaps healthier, you may get a better deal based on your classification and criteria. If you wait to buy life insurance, you will miss out on the earlier years which lower your average, therefore, you end up paying more. Apart from the increase in premium costs, putting off your insurance purchase can cause annoyances during the application process. You are likely to undergo additional medical exams that you would not need to worry about if you decided to buy earlier.
Qualifying for Coverage at your Age
Insurance rates tend to increase very birthday. This is because you are a year closer to your life expectancy, which makes you more expensive to insure. When your current policy expires, you might face steep rates based on your age. Older ages can limit your options. For instance, the majority of insurance companies only provide 20-year term policies to ages 18-70. Along with your increase in age every year, comes the need to undergo additional testing to determine if you have certain illness common to that age.
As every year can mean more dollars on your term life insurance premium, consider buying coverage before your next birthday. We can help you get the best term life insurance rates at your age. Ensure you get at least two quotes from various insurance companies so that you can compare and pick the one that suits your needs.
