Which personal factors most impact insurance pricing?

The cost of life insurance can affect people differently due to several factors. Some of the factors that impact the price of life insurance are age, smoking or non-smoking status, health condition, occupation, hobbies (skydiving or rock climbing) and gender.

You will see a dramatic difference in the price depending on gender, age and health condition. As a person ages, the possibility of health-related issues can increase. There will be a considerable price difference in purchasing a policy at the age of twenty versus forty — more risk for the insurance company. If you are a smoker versus a non-smoker, the risk of death is greater. Therefore, the price of a tobacco smoker will be higher than a non-smoker.

Occupations and hobbies affect the price of life insurance too. If you are a drag racer, race car driver or utility line tradesman, your policy will be higher than that of a teacher or regular office professional. Again, the risk of injury leading to death is greater for certain occupations and hobbies, and the price will reflect that risk. 

Always be honest with your answers for proper pricing. If you aren’t honest, those are grounds for termination of the policy due to fraud or false information. The insurance company may not pay out the death benefit as a result of misleading information.