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Primary Factor That Determines the Amount of Premium in The Life Insurance Policy

lifeinsuranceplansDec 12, 2019, 1:36:54 AM

Life insurance is primarily bough to protect one's beneficiaries, and also as a means of saving. There are different kinds of life insurance. However, life insurance is broadly divided into term and permanent life insurance. Permanent insurance is designed to stay for the insured entire life. Permanent insurance provides death benefits to the beneficiaries. Permanent insurance is also used as a means of saving. Permanent insurance is subdivided into whole life insurance, universal life insurance, and variable life insurance. Read more now about life insurance on this websuite.

On the other hand, term insurance is meant for a short period of between five to 30 years. After the expiry of the term insurance, you can renew it. Besides, you are allowed to convert term insurance to permanent life insurance.

There are a couple of criteria that an insurance company such as William Penn uses to determine the amount of premium that you are going to pay. Some of these factors you can control while others are out of your control. The most important thing that the insurer check is the age of the applicant. The older the policyholder is, the money they will be required to pay monthly. Older people also have a longer list of dependents compared to the young policyholders.

The sound thing that determines your monthly premium is your health. Many of the insurance companies require the applicant to undergo medical examination before they enter into the contract. The medical examination includes checking the conditions such as obesity, hypertension, diabetes, weight, heart-related problems, among these. You will pay more if you have a medical condition. Ensure that you manage your situation before applying for the policy. The insurance company is also likely to check the family medical history. If your family has a history of stroke, cancer, heart attack, or any other serious condition, you will be required to pay more. Click here for more details: https://chooseterm.com/2017/05/william-penn-life-insurance-review/.

Another factor the company check is your lifestyle. If you engage in high-risk activities such as mountain climbing, then you will have to pay more. Also, if you are employed in a precarious profession such as mining, you be charged more cash. Another lifestyle that the company may check is whether you are a heavy smoker or drinker. Smoking predisposes you to endless diseases. Other factors that determine your premium include prescription history, driving record, credit attribute, honesty. These factors will determine the amount that you will get. A million-dollar life insurance policy is among insurance policies that require the policyholder to pay a considerable premium. Discover more about a life insurance policy at https://www.britannica.com/topic/life-insurance.