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Obtain Life Insurance While You Can

li-9A few years back, a high school teacher collected baseball cards so his family could sell the cards after he died and have money to support themselves and pay his funeral expenses. Why not just take out a life insurance policy? Well, by the time he started a family and began thinking about life insurance he had developed a heart problem that made him uninsurable. It goes to show you should obtain life insurance while you can.

His story is not only a reminder of why everyone should obtain life insurance while you can as early as possible but also highlights something most consumers don’t understand: How life insurance companies make decisions.

Whether or not you qualify for coverage and how much your coverage will cost is determined by underwriters who analyze the risk you pose to the life insurance provider. For example, if there’s a good chance statistically that you will die at some point during your insurance term then your premiums will be higher or you may be rejected altogether. Both are scary propositions when you’re trying to take care of your family or friends.

Understanding the factors that influence the underwriters’ decisions, however, can make it a little easier to see why getting coverage now is the best idea.

Protect Your Family. Search Life Insurance Rates. A recent study of underwriting factors compared premium quotes using a standard profile, a 45 year old, non-smoking man in California purchasing a $500,000 policy for a 20 year term. Changing certain health and lifestyle factors to determine which ones had the biggest impact on premiums is key. For example, the average quote increased by more than $600 when the insured individual’s weight increased from 180 to 240 pounds.

Other factors also sent premium costs soaring, including the early death of both parents or parents being diagnosed with diabetes, heart disease, or cancer during their lifetimes. High cholesterol and high blood pressure also caused premiums to increase.

While you may not be surprised that health factors such as these can raise your premiums, you may not know that your driving record will also influence insurance costs. If you have more than two driving-related convictions on your record, your premiums will jump hundreds of dollars. The underwriters assume you are a risk-taking driver and eventually your luck will run out so you are considered a bigger financial risk.

The study also covered two other major factors: smoking and age. If you are a smoker, your life insurance premiums will be considerably higher. On average, you’ll pay 50% more in premiums than a non-smoker. Even if you quit tomorrow, your premiums won’t immediately go down. Most insurance companies require you to be smoke-free for at least 1 year and some longer.

Age is also an important factor. The insurance premium for a $500,000, 20 year term policy for a 40 year old smoker averages about $119 per month. That same smoker would pay $422 for the same policy at age 55. That’s a huge increase in premiums simply because fifteen years have passed and those years increase the risk of death.

As you can see from these factors, the best plan is to secure life insurance before these factors influence costs. Even if you already have one or more of these factors, you’ll still pay less now than you will five, ten, or fifteen years from now. Plus, you could end up like the retired teacher whose health made life insurance protection an impossibility.