Is there a perfect age for life insurance? Does having perfect health mean you get the lowest premiums? Is it worth getting life insurance in your old age?
These are but a few questions that many Canadians have in mind when considering investing in a life insurance policy. The impact of age, health, and various other factors can all impact how much you pay in premiums which can make things confusing.
Luckily, to get all the answers you seek you have come to the right place! So, without further ado, let’s discuss the impact of age and health on life insurance premiums in Canada.
How Does Age Impact Life Insurance Premiums?
An individual’s age can have a significant impact on the type of life insurance policies you can get and the amount of premium you will have to pay.
Many experts believe that the best time to buy life insurance is when you think you least need it. This is because when you are young and healthy the risk of you dying is significantly lower. The lower the perceived risk, the lower the premiums are likely to be.
However, that doesn’t mean older people shouldn’t consider life insurance. As the population of seniors increases in Canada, the options for life insurance policies have also increased. Individuals over the age of 60+ still have many options available for life insurance and should consider investing in a life insurance plan even if it means having to pay higher premiums.
For those over the age of 75, however, life insurance isn’t a viable choice. Policies are hard to come by and the premiums tend to be astronomically high.
What Is The Ideal Age To Invest In Life Insurance?
As such, many consider the ideal age to invest in a 20-year term life insurance policy to be in the late twenties or early thirties. At this age, you will likely have dependents, a steady job, and be in sound health, all of which will mean much lower premiums.
How Does Health Impact Life Insurance Premiums?
As you would imagine, a person’s health can play a significant role in determining how much premiums they will need to pay for life insurance.
As such, most insurance providers will require a health assessment during their application process. Some providers may require a medical exam conducted by a healthcare professional as part of their application process while others might ask for medical records and family history.
If you are in perfect health you will likely get a much lower monthly or annual premium quotation. However, if you have certain health conditions your premiums are likely going to be a lot higher.
So, does that mean unhealthy people can’t get life insurance? No, even if your health condition doesn’t make you eligible for standard life insurance you have other options available.
In Canada, certain insurance providers offer Guaranteed Acceptance Life Insurance that doesn’t require an individual to answer any health questions or have a medical exam. Of course, the premiums for these types of insurance policies can be quite high, so it is always advisable to consult with a licensed and trusted life insurance advisor to ensure this type of policy is right for you!
Other Factors That Impact Life Insurance Premiums
Apart from your age and health, life insurance premiums can be impacted by other factors as well. These include:
Type of Policy & Coverage Amount
There are various types of life insurance policies. Depending on the type of policy you want, premiums can vary significantly.
The two most common types of life insurance policies are term life insurance and whole life insurance.
Term life insurance policies are generally offered in 10 or 20-year terms. The premium for 10-year coverage will be lower than a 20-year term.
Whole life insurance coverage tends to have the highest premiums as it offers coverage for the lifetime of the policyholder.
The coverage amount for your policy can also impact premiums. A $100,000 policy will have a lower premium than a $200,000 policy as the insurer is taking a higher risk.
Males tend to have higher premiums than females, as statistically, males on average have a shorter life span than females and as such are associated with higher risk.
Smokers & Vapers
As a rule of thumb, if you are a smoker or someone who vapes your premiums are likely to more than double. Any form of smoking that involves the use of nicotine is considered ‘smoking’ and will automatically increase the premiums you will be liable to pay.
In order to be considered a non-smoker one mustn’t have smoked any substance with nicotine at least in the past 12 months.
Lifestyle & Occupation
If you work dangerous jobs or work in an industry that is prone to occupational hazards, you might find yourself having to pay higher than average premiums.
Your lifestyle choices can also dictate the amount of premium you have to pay. If you have hobbies such as deep sea diving, skydiving, racing, etc. you will have to pay more in premiums to offset the risks.
Choosing The Right Life Insurance Coverage That Works For You!
There are many intricacies to a life insurance policy. Without the proper knowledge and legal know-how you can easily fall into the trap of paying more in premiums or opting for a coverage amount that is either too low or too high for your financial situation.
As such, when it comes to choosing a life insurance policy, it pays to consult with the experts. We at McIver Insurance Inc. specialize in life insurance and group benefit plans for individuals and small businesses.
As Nova Scotia’s most trusted life insurance broker, we treat every case individually, helping our clients find the best insurance policy to suit their unique needs and financial objectives.
If you are ready to take the necessary steps to secure the financial future of your loved ones call us today for a free quote at 1-902-220-3279 or email [email protected]