6 Factors That Will Help You Drive Your Term Insurance Premium Down

6 Factors That Will Help You Drive Your Term Insurance Premium Down

Several factors come into the picture when deciding on the premium as well as tenure for your term life insurance. While we cannot control some of these factors such as gender and age, there are certain factors in which we can make slight tweaks to bring down the premium amount on our insurance plans. Below listed are 6 such factors –

Lifestyle habits

Your lifestyle is one of the primary factors that will help determine your insurance premium. Whether you smoke one cigarette in a day or finish the entire packet, can significantly increase or decrease your premium amount. The same goes for excessive alcohol drinking. Policyholders who have a smoking addiction or are alcoholic are naturally charged with higher premium amount than those who smoke one cigar a day or drink occasionally. This is because smoking and alcohol consumption are considered as “mortality risk factors.” Therefore, if you want to cut on your premium amount, make sure you infuse positive changes in your lifestyle. 

Nature of your job

What field you work in could also influence the premium of your term insurance plan. People employed with armed forces, bomb demolition squad, fire departments, etc. have way more threat to their life than people working a 9-5 desk job. While all these are respected professions, the riskier your profile, higher will be the premium on your term insurance. 

Physical Health

At the time of buying a term insurance plan, the insurance company asks you to undergo a complete medical check-up. If you are diagnosed with any chronic medical condition, the premium amount goes up. This is because people who have a predisposition to diabetes, obesity, or heart disease are at higher risk than healthy individuals. Thus, make sure that you take good care of your health. Not only will this help cut on the premium amount, but will also spare you the constant troubles of visiting hospitals and paying expensive medical bills. 

Sum Assured Amount

One of the key term insurance benefits is the sum assured offered to the nominee upon the policyholder’s death. This sum assured is a significantly large amount that is promised as a death coverage at the time of buying a term insurance plan. The amount that you decide to keep as your sum assured directly affects your premium amount. Higher the sum assured, higher the premium on your term insurance and vice versa. 

Riders opted

Some insurance providers offer extra riders along with their term insurance plans. These riders offer several benefits such as accidental death benefit, disability cover, critical illness cover, etc. However, all these riders have to be bought separately along with your term insurance plan. Thus, more the riders you add to your plan, higher would be the premium that needs to be paid. Hence, to cut back on your premium amount, you can stick to a basic term life insurance plan or buy only those riders that dwell well with your insurance goal. 

Buying online plans

Term insurance policies bought online prove to be much cheaper than insurance policies bought through offline modes. This is because the cost of a middleman, as well as the distribution and administrative charges, get eliminated. The insurance companies benefit directly from the policyholders and in turn, reward them with low premium amounts.

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