Term life insurance policies only cover you for a certain amount of time, which is set by the policy owner. Term life insurance rates are the least expensive type of life insurance, but they vary from person to person. This is because once the policy's term is over, you don't get any money from it. If you get term life insurance when you're young, the rates will be much better than if you wait until you're older.
It can be hard to figure out the total cost of your term life insurance rates. Some term life insurance policies seem to be more expensive, but when you look at the total cost of the policy, they may be less expensive. For example, the premiums on annual renewable policies go up every year, making them look more expensive than level term policies, where the premiums never go up (although the initial premiums for a level term policy will be higher). But in reality, level premium policies may cost more over the life of the policy, and it will be especially expensive to try to renew your policy when the term is up. This is why you should compare quotes for term life insurance.
Some of the things that affect how much you pay for term life insurance are:
- Health Record. Almost no life insurance company will give you a policy if you have a disease that will kill you soon. If you have heart disease, you will be able to get insurance, but your rates will be high.
- Profession. If you work in a dangerous job, like on a ship that carries gas, you will pay more for term insurance. If you are in this group, you will have to look around for different quotes on term life insurance.
- Whether you smoke or not. People who use tobacco are twice as likely to die while they are insured as people who don't use tobacco. This is taken into account by life insurance companies when they decide how much to charge for premiums and how much cash to pay out. If you stop smoking, you can save anywhere from 20% to 30% on your premiums.
Rates for term life insurance vary a lot, and you can lower your premiums by doing things to improve your health, like quitting smoking.
