How is Life Insurance Premium Calculated

1
How is Life Insurance Premium Calculated?
2

• What is life insurance premium?
• It is regular amount pays to insurance company to
  purchase a policy and to keep it in force in
  return the insurance company agrees to pay your
  nominee or beneficiary a sum of money upon your
  demise. In the event you suffer total and
  permanent disability, the payment will be made to
  you in these circumstances the money is usually
  payable in installments.

3

• How is your life insurance premium calculated?
• Life insurance companies don't take risks to
  cover an insured when they are determining the
  rates, they want to take precautions to ensure
  the insured won't die prematurely, because the
  pay out will be more than the amount the insured
  paid.
• The insurance companies collect the premiums from
  the policyholders and pay for the overhead and
  administrative expenses, they invest the money to
  create a pool of money to pay claims and make
  their profit from investment, premiums collected
  are not enough to sustain, so they have to
  calculate precisely, otherwise their business
  will be at a loss.

4

• The calculation of life insurance premium is
  based on age, gender and health
• A younger person has a longer life span, so
  his/her policy has a longer maturity, and it is
  axiomatic that his premium will be cheaper.
  According to mortality table women outlived men,
  so women have lower rates on life insurance.
  Family medical history also plays an important
  role, for example if a person's parents or family
  members suffered diabetes or high-blood pressure
  he may have to go for medical check-up before he
  buys a policy, and he is classified as high risk
  buyer, the insurance company will access him and
  consider whether or not to take the risk to
  insure him.

5

• Each an every insurance company sets its own
  rates of Life Insurance Premium Calculator, the
  type and amount of insurance you purchase and
  your lifestyle habits also affect your premiums,
  such as if you are a smoker you will pay a higher
  rate.
• If you want to know how much you need to pay for
  the premium if you want to purchase a policy.
• http//EzineArticles.com/2306840

6
Follow us on
https//www.facebook.com/bajajallianzlifeinsurance
ltd
https//www.linkedin.com/company/bajaj-allianz-lif
e-insurance-co-ltd-
http//plus.google.com/bajajallianz/posts
https//twitter.com/bajajallianzLIC
https//www.youtube.com/user/jiyobefikar
https//instagram.com/bajajallianzlifeinsurance
7
Click to know more Life Insurance Premium
Calculator
https//www.bajajallianzlife.com/calculators/life-
insurance-calculator.jsp
Thank You