What is the impact of age on Life Insurance premiums?

  • Life Insurance


What is the best age to get an insurance policy? How does my age affect my insurance policy? These are common questions that can cross your mind. You might know someone who is only 25 and has already bought a Life Insurance Plan. While, somebody who is 45 still doesn't have it. So is there a right age?

Life Insurance provides financial protection and security to your family in your absence. So the right time to buy one depends on your financial goals and protection needs. If you have people who are financially dependent on you, buying life insurance is more than advisable.

There are many factors that affect your life insurance premium. Age is one such factor. So, let's look at how age affects your life insurance premium.

What is a premium?

When you buy a life insurance policy, you have to pay a certain amount periodically to the life insurance company. This is called a premium. The premium maintains the life cover. If you do not pay the premium the policy will lapse. This means that the policy will not be in effect and you will not get the life cover. Premium is the price you pay to buy the insurance. So, paying the premium regularly is important.

There are many factors that decide the amount you pay as your premium. Your medical history is considered. So is your lifestyle habits like smoking and consumption of alcohol. Your family's medical history, gender, hobbies and occupation is also taken into account.

Another factor is age. Age is the biggest and the most important part of determining the premium you pay. But how does age affect the premium you pay?

How does age affect the Life Insurance premium?

It is always best to buy life insurance at a young age. When you buy insurance at a young age the premium remains low. It is usually considered that when you are young, you are healthier. You are less likely to fall ill, have lower health-related risks and low risk of mortality. This is why you have to pay a lower premium as compared to when you are older. If you buy insurance at an older age, you might have to go to certain medical tests. Thus, being young acts in your favour.

At a younger age you also have less responsibility. Which means you might not need a very large life cover. While, when you are older you end up collecting more responsibilities. You have debts, obligations, loans, and other financial goals. This means you will need greater protection to secure your family's future. Thus, you will need to buy an insurance policy that provides a large life cover. This means you will also have to pay a higher premium.

Buying a life insurance plan at a younger age and early in your professional life helps you save a lot of tax. The tax benefits you get when you buy insurance is worth considering. As per Section 80C of the Income Tax Act, you can avail tax benefits of up to Rs.1.5 lakh on life insurance premiums. The money you receive on maturity or death are also tax-free under Section 10 (D) of the Income Tax Act, 1961.

Insurance plans like ABSLI DigiShield Plan give you very large protection at a low premium. Riders enhance your insurance and give you additional protection. For example, some riders cover your hospital expenses or surgical expenses. If you buy a retirement plan like ABSLI Empower Pension Plan at a young age, you can collect a large financial corpus at a younger age. This can help you retire at a younger age and enjoy life stress-free with enough money in hand.

So, you need to assess your requirements and your goals and buy insurance accordingly. Whether you are in your 20s or 50s, your premiums depend on multiple factors. But, the younger you are, the better. So consider all your options, make a wise decision and act early.


ABSLI Empower Pension Plan (UIN: 109L078V03) is a non-participating unit linked life insurance pension plan. Aditya Birla Sun Life Insurance and ABSLI Empower Pension Plan are only the names of the Company and Policy respectively and do not in any way indicate their quality, future prospects or returns. The name of the funds offered in this plan does not in any indicate their quality, future prospects or returns. In ABSLI EMPOWER PENSION POLICY, THE INVESTMENT RISK IN INVESTMENT PORTFOLIO IS BORNE BY THE POLICYHOLDER.
ABSLI DigiShield Plan (UIN: 109N108V06) is a non-linked non-participating individual pure risk premium life insurance plan; upon Policyholder's selection of Plan Option 9 (Level Cover with Survival Benefit) and Plan Option 10 (Return of Premium [ROP]) this product shall be a non-linked non-participating individual life savings insurance plan.


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ABSLI Life Shield Plan

A term insurance plan that offers you the flexibility of plan options suitable for your family's non- negotiable goals and ensure they need not compromise on their lifestyle. UIN: 109N109V06

  • Choice of 8 plan options
  • Cover your spouse under the same policy
  • Longer Life cover till age 85

ABSLI DigiShield Plan

PROTECTING multiple life needs with one plan is now possible. UIN 109N108V08

  • 10 Plan Options to suit your varied protection needs
  • Flexible death benefit pay-out options
  • Life insurance cover for 1 year or till age 100 yrs

ABSLI Saral Jeevan Bima

A simple plan to protect your family’s financial future (UIN 109N128V01)

  • Simple & affordable plan
  • Flexible premium paying terms
  • Enhance insurance cover with rider

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