You probably need life insurance. Lots of people do.
If you have small children, a mortgage, a spouse who’s dependent on your income—or any person who would be inconvenienced financially if you were hit by a bus tomorrow, you probably should have life insurance.
Experts generally recommend buying 10 to 20 times your annual income in term life insurance, which is the most affordable variety. You make $50,000? Great. You should probably have at least $500,000 in life insurance.
Luckily, it’s not prohibitively expensive. A 40-year-old healthy nonsmoking male may be able to buy a 20-year level term $500,000 policy for as low as $350 per year, AccuQuote.com estimates. (“Level term” simply means the annual premium will stay the same for the term of the policy—in this case, 20 years.)
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But there are a variety of things that could make your life insurance policy pricier, from health conditions to hobbies to lifestyle choices. Here are some of the top offenders:
1. Tobacco use. If that same healthy 40-year-old male admitted to being a smoker, his annual premium could jump to at least $1,535, according to numbers from Accuquote.com. Stop smoking, meanwhile, and it will take one year before you can get a nonsmoker discount, but you won’t get a top-tier price until you’ve been cigarette-free for at least three years. “They want to be really sure you’re off it,” says AccuQuote founder and C.E.O. Byron Udell. That said, if you need life insurance now, go ahead and pay the higher premium—and when you’ve stopped smoking, call your insurer and see if you can lock in the lower price.
2. Your weight. Being overweight increases your odds of dying, so the more overweight you are, the more expensive your life insurance will be. Depending on the carrier, as little as 10 to 15 pounds may be enough to knock you out of the top pricing tier, Udell says.
3. Your driving record. A couple of recent tickets aren’t going to seriously raise your annual premiums, but if you have more than two moving violations in the last three years, you likely won’t be able to get the best life insurance rates. “Insurers know that each time you get a speeding ticket, you were probably speeding about 250 times before you got caught,” Udell says. “If you’re routinely violating traffic laws, there’s a much greater likelihood you’re going to die in a traffic accident.”
4. Cardiovascular disease. This includes high blood pressure and other heart issues, which can lead to early death. “Sometimes they’ll write a life insurance policy with an exclusion for heart conditions,” says LearnVest Planning Services Certified Financial Planner™ Katie Brewer. “So they’ll give you insurance, but exclude you if you die of a heart condition.” If you have high blood pressure, but it’s controlled by medication, you should have no major problems. That means you can’t show up to your insurance exam with a blood pressure of 145 over 95, Udell says. “That’s not controlled. It’s the high blood pressure itself, not the medication, that concerns them.”
5. Cancer. If you have or have ever had cancer, you will likely never qualify for the best life insurance rates—but you may still be able to get a policy, depending on the type of cancer and your current status. Pancreatic? Not likely. Breast cancer? Maybe not now, but when you’re five to seven years cancer-free, you should be able to qualify for standard rates. “There’s usually a time period where you have to be cancer-free before you can be approved for life insurance,” Brewer says. But you may be able to find an insurer that doesn’t ask about cancer at all. An insurance broker can steer you toward the companies that don’t ask that question.
6. Depression. If you’re taking medication for an ongoing depressive condition (meaning it’s more than just a temporary state due to, say, a loved one’s death), you will probably see higher rates because of it. “The issue is that in a worst-case scenario people may jump off roofs when they’re depressed,” Udell says. “Carriers don’t have to pay for suicide for the first two years, but after that, they do.” The mortality effects of certain medications can also be a concern.
"Like hobbies, if your career takes you to death-defying heights or puts you in risky situations, your insurer will likely raise an eyebrow."
7. Cholesterol. Like high blood pressure, high cholesterol usually isn’t a big deal if you’re controlling it with medication. But if you’re not taking your meds—or the meds aren’t doing enough—life insurance companies may view you as higher risk.
8. Substance abuse. If you have a history of substance abuse, that could make you a death risk to a life insurance company, but it depends on the substance, how recent it was, and how regularly you’re using it.
9. Family history. Insurers are going to ask about your immediate family—parents and siblings—and if any of them have serious or hereditary conditions that could cause an early death, that’s probably going to hike up your rates. Chief among those conditions is cardiovascular disease (particularly if a parent died early from it), cancer and diabetes. That is not to say, however, that you can’t plead your case. “If you have some great explanation, like your dad smoked two packs a day and you’ve never smoked in your life,” Udell says, you may be able to sway the underwriter.
10. Diabetes. People with Type 1 diabetes typically have impaired life expectancies across the board, so your rates will depend on how well controlled your condition is and what you need to control it. If well controlled, Type 2 is less serious and should cause a smaller spike in your price. But it’s all about circumstances. “If you’re a diabetic and all you need to control it is diet and maybe an oral medication, you’re not much of a risk,” Udell says.
11. Asthma. Like other conditions, if your asthma is under control, you may not see much of a price impact. If you’re on steroidal medication, that may impact your premiums, since steroids themselves tend to bump up your chances of dying. And if you’ve landed in the emergency room in the last couple of years due to your asthma, that’s going to raise warning flags for your insurer, because it may mean that you’re not doing a great job controlling your condition.
12. Dangerous hobbies. Anything that statistically increases your chances of death could hike your life insurance premiums. “Some life insurance companies won’t even write policies on people who do these things,” Brewer says. Although that doesn’t include skiing and biking, it does include rock climbing, motorized racing, skydiving, ultralight flying, hang gliding, and scuba diving.
13. Your occupation. Like hobbies, if your career takes you to death-defying heights or puts you in risky situations, your insurer will likely raise an eyebrow. Luckily, that only includes you if you do something like drive race cars, handle explosives, fly planes, or work as a trapeze artist in the circus. While some insurers raise rates for firefighters and police officers, many don’t penalize them as a matter of public policy. (Maybe your desk job isn’t so bad, eh?)
LearnVest Planning Services is a registered investment adviser and subsidiary of LearnVest, Inc. that provides financial plans for its clients. Information shown is for illustrative purposes only and is not intended as investment, legal or tax planning advice. Please consult a financial adviser, attorney or tax specialist for advice specific to your financial situation. Unless specifically identified as such, the people interviewed in this piece are neither clients, employees nor affiliates of LearnVest Planning Services. LearnVest Planning Services and any third parties listed in this message are separate and unaffiliated and are not responsible for each other’s products, services or policies.