What affects your premium
Your circumstances
Insurers may consider age, health, smoking or nicotine use, occupation, and other risk factors. The information required varies by product and application process.
The coverage amount
The amount of insurance affects the premium. Compare prices for the same benefit before deciding which offer is less expensive.
The type and duration
Term and permanent policies serve different timeframes and may have different features. Within term insurance, the initial coverage period and renewal schedule also matter.
Added benefits
Optional riders can change what a policy covers and what it costs. Make sure you're comparing the same additions, or that you understand why they differ.
Know which number you are looking at
| Number | What it tells you |
|---|---|
| Coverage estimate | How much insurance you may want to consider.? |
| Advertised example | A price for a particular profile, product, and set of conditions. |
| Quote | A proposed price based on the information provided, subject to any stated conditions. |
| Insurer's offer | The terms offered after the insurer's assessment, with acceptance and effective-date requirements to check. |
An advertised rate for one age and coverage amount won't tell you the cost of a different policy for your household. Ask for the details behind the figure.
Put quotes on the same footing
Compare the insured person, benefit amount, initial term, added benefits, payment frequency, and application assumptions. Then compare the premium and what happens later.
If one quote requires more information or is conditional on an assessment, make that part of the comparison too.
Read the price over time
Find out whether premiums are fixed for a period, change at renewal, or follow another schedule. Ask about policy fees and any difference between monthly and annual payments.
A cost that fits today should also make sense against the period you expect to keep the policy. With permanent insurance, review the payment obligations and guarantees rather than assuming every product works the same way.
If the premium is higher than expected
Start with the purpose of the coverage and discuss the options. You might compare a different amount, duration, policy type, or selection of added benefits.
Be clear about the trade-off. Reducing a benefit leaves a larger financial gap. Shortening a term may leave a later need. Adding coverage in the future may require another application and is not guaranteed.
What if I smoke or have a health condition?
Provide accurate information and let the insurer assess the circumstances. Different products and insurers may produce different outcomes. Smoking can affect cost, and a health condition does not by itself tell you what every insurer will offer.
If your circumstances change, ask whether the insurer offers a review process. Do not assume a lower premium applies automatically.
What to ask before accepting an offer
- Is this the assessed premium, or could further information change it?
- How long does this premium apply, and what happens afterward?
- What coverage, exclusions, and added benefits are included?
- Are there fees or payment-frequency differences?
- What must happen before coverage begins?
Keep the answers with the policy so you can refer to them at the next review.
Start with the coverage. Then compare the price.
An estimate helps you decide what to request. A quote helps you assess the cost. Reviewing the policy helps you understand what you're paying for.
Keep reading.
YOUR NUMBER.
How much life insurance do I need?
Start with the financial support you'd want in place if you died. Add the costs you want covered, then account for the resources already available.
WITH A PURPOSE.
Is life insurance worth it?
It can be, when a policy protects against a financial loss your household couldn't comfortably absorb. Start with that loss and the people it would affect.
PERMANENT?
Term vs permanent life insurance
Both can provide financial protection after an insured death. The main difference is how long the coverage is intended to last, alongside its cost and features.