Regardless of where you are at in life, you should invest in a life insurance policy. However, depending on your age, an 18-year-old and a 65-year-old will likely not qualify for the same insurance rates. 

Advisors at National Educational Services understand this concept can be tricky to understand and navigate. We are here to help you better understand how age plays a role in your premium cost. 

How Life Insurance Companies Factor in Age 

Life insurance premiums are dependent on a number of factors. The most significant factor impacting your life insurance is whether you purchase a term life insurance policy or a permanent life insurance policy. 

Term life insurance tends to be cheaper, as the coverage only lasts a certain number of years. Your rate will not change during the duration of the term but once it ends, you will have to renew your policy and the rate will not be the same. 

Permanent life insurance, on the other hand, provides coverage until you die. Due to this extended coverage, you will have to pay higher premiums. Additionally, your insurance company is likely going to raise the premium each year because they do not have a term to average the cost. 

Insurance companies tend to use actuarial tables in order to determine life expectancy and estimate mortality rates. The company then sets a rate so they will not lose money in covering you.

How to Save on Life on Insurance 

Whatever your age may be, you have options when it comes to saving on your life insurance policy. These specific strategies can be used based on your age but, they help lower the cost associated with life insurance policies. If you are looking to save on your premium, look at the tips listed below. 

Make Your First Purchase Term Life Insurance 

As a young individual, purchasing term life insurance is the best option. You are able to purchase a longer policy so you will not lose coverage too soon, but you will also receive a lower premium than you would if you purchase a permanent policy. 

After your policy ends, you can renew it, although you will pay a higher rate. But this rate still tends to be lower than the cost associated with a permanent policy.

Buy Before Your Birthday 

No matter your age, you should look to purchase term life insurance policies before your birthday. This will allow you to qualify for lower rates because the term will both start and end when you are a little bit younger. 

Furthermore, you may also be able to avoid certain required tests in order to qualify for coverage. If a life insurance company requires a test for individuals 45 and older and you start your policy at 44 years old, you will not need the test to qualify. This will increase your chances of qualifying for coverage while at a lower rate.

Make the Switch to Permanent Life Insurance 

As you age, it may be a wise idea to make the switch to a permanent life insurance policy. For one, it may be harder to obtain a term life insurance policy as you may not qualify for a longer term. With a permanent life insurance policy, you can relieve the stress of having to remember to renew your policy. 

Get Multiple Quotes

Regardless of your age, you should always shop around for life insurance policies. There may be better rates and coverage options out there that you are unaware of. Do your research and assess the best companies in your area to get quotes from. 

Additionally, you should consider how much coverage you may need and what your budget is for the policy. Establishing criteria for both will make the process of finding quotes and assessing companies easier and more useful. 

Contact National Educational Services 

Advisors at National Educational Services want to help you find peace of mind, financial security, and tailored coverage. Reach out to an advisor today to get started on your path to finding the best life insurance coverage for you.