Impact of Age on Life Insurance Premiums

Age is just a number - until it comes to buying a Life Insurance policy. It plays a rather big and important role. You might decide to buy a life insurance plan at the age of 40, but your neighbour may have already bought it at the age of 25. Even though there is no right or wrong age to get life insurance and protect your family, there is an impact that age makes on the premiums you pay.

How? Let’s find out, in this article!

A life insurance premium is an amount you pay your insurer periodically - to keep the policy active. In pure protection plans, like term insurance, you get a life cover in exchange for the premiums you pay. On the other hand, in plans with an investment component (like ULIPs, Money-Back Plans, etc.), part of the premium goes into investment and the rest provides you with insurance.

If you are unable to pay the premiums on time, it could lead to a policy lapse. A lapse is a situation where you can no longer avail the benefits and cover provided under the policy, i.e., it becomes inactive. Hence, premiums are the price you pay to keep your life insured and your family financially secure.

Multiple factors determine the amount you pay. For instance -

• Your medical history. If you have any disease/ illness, you may have to pay higher premiums.
• Your lifestyle habits, like smoking and alcohol consumption, can also translate into increased premiums.
• Other factors, like gender, occupation, hobbies (like skydiving, motorised racing), etc. also have an impact.

But the biggest determining factor is age.

When you get older, the chances of you contracting serious illnesses increase. Or you might get diagnosed with a lifestyle chronic disease. This means the chances of your insurer paying out on your policy increase - causing your premiums to rise. Also, you might have to go through various medical tests, and depending on the results, your policy might not even get approved.

When you are young, you are generally fitter and healthier, with fewer underlying health conditions. Hence, the premium remains low and good coverage stays guaranteed - if you buy it earlier in life.

So if you invest in it early and can save more, does it make sense to buy a policy as soon as you can? Let's find out -

If you have financial dependents or loans to pay off, a good age to buy it is when you’re younger - to get a large coverage at low costs. The premiums are set for life. So for the same cover, if you plan to buy it early, you will need to pay less in comparison to someone who opts for it later in life.

We bring to you ABSLI DigiShield Plan - which gives you a large coverage at really affordable rates. You can also pick and choose riders for added protection. For instance, hospital and surgical expenses can be covered by riders. They also provide financial relief if you suffer from critical illness, or meet with a permanent disability.

You can also buy ABSLI Empower Pension Plan, and build a large savings fund early in life. This can help you retire at a younger age, pursue your dreams, and enjoy life worry-free.

Life insurance provides financial security to your dependents - so it is definitely wise to hold one. And it is even wiser to get one when you are in the prime of your life. You never know the uncertainties life’s going to bring your way. So all you can do is be prepared, and enjoy life while it is happening.