Factors Affecting Term Insurance Premiums

    Term insurance plans have come out as an alternative to life insurance plans that many people are investing in. If you have often wondered, “what is a term insurance plan? then we have all the answers to your questions.  A term insurance plan works just like a life insurance plan. Its main purpose is to financially provide for the policyholder’s family in case of their untimely demise.

    Through the policy, you can assure an amount that will be given to your family to protect them from liabilities and more. These plans are usually affordable, but the premium you pay for them depends on several factors. Below we have made a list of all these factors, so you can estimate the cost.


    Age is a significant factor that affects the premium you pay for a term insurance plan. This is because health concerns increase with age. Therefore, young individuals are offered a  lower premium rate in contrast to older people. The rate of the premium goes on increasing as you age which is why it is recommended that you invest as early as possible.

    Starting from 18 years of age, anyone can invest in a term insurance policy. Going for a term insurance plan as early as possible will allow you to get affordable term insurance and save a considerable amount in the future as well.

    Medical history

    The medical history of family members comes into play to examine any diseases which are hereditary in the family or to know about any disease that the policyholder is at risk of. If your family has a long history of diseases, then there is a big possibility that you will have to pay a higher premium.

    This is because when the insured is prone to several diseases or medical conditions, there are more chances or risks to their life. As a result, a higher premium is charged by such people.

    Health conditions and lifestyle habits

    Aside from your family’s health history, your medical history also plays a significant role in determining the rates of premium you will be charged. If you are struggling with any illness or disease, you will be charged a comparatively higher premium rate. This is because the risk to your life would be greater in such a case as compared to an individual who is physically fit with no pre-existing illness.

    Along with health conditions, many plans also consider your lifestyle habits. So, if your lifestyle includes habits that can negatively impact your life, such as smoking, drinking, drugs, etc., you will have to pay a higher premium. This is because these habits increase the chances of you developing an illness.


    Professions are also considered while developing the premium rate as some professions are riskier than others. Jobs such as pilots, sailors, soldiers, etc., are more demanding and include several circumstances where your life is at risk. Since, while performing these jobs, you are more susceptible to danger, you will have to pay a higher insurance premium.

    This also includes individuals who are frequently exposed to chemicals, environmental hazards, and other such components that are risky.


    You can always go for a long-term insurance plan as well as a short-term insurance plan. Depending on the duration of your insurance plan, your premium will be calculated. It goes without saying that choosing a long-term insurance plan will cost you more than choosing a short-term insurance plan. The same goes for coverage.

    Interests and Gender

    Surprisingly, your interests, as well as your gender, also play a role in determining the rate of your premium. According to popular belief and scientific study, it is considered that women live longer than men, which is why women are often charged a lower premium rate as compared to men.

    When it comes to your interests, individuals showing interests or frequently performing activities that pose a risk to their health or life are charged much higher premiums than those who do not have any such inclinations.


    From all the points mentioned above, you can estimate what aspect of your life will add to the premium cost of your insurance plan and what will not. Knowing about the insurance plan you are looking to buy is always beneficial, whether you are looking for a term insurance plan or the best long-term saving plans.

    So, make sure you do your research, and you will be good to go!