One of the most common doubts for those who are interested in taking out life insurance is its price. There are several factors that determine the final price of the policy. With this article we will solve all the doubts related to this question.
When it comes to taking out life insurance , a series of details needs to be taken into consideration to set the price of the monthly or annual fee. Reviewing the main data required when requesting a policy, these are the keys to take into account:
The date of birth is a major factor when setting the price of life insurance. This is a piece of information that determines the life expectancy of the insured and serves as a guideline for the insurance company when setting the price.
The younger the insured, the more life expectancy is estimated and the cheaper the policy will be; the older you are, the greater risk it implies for the insurer and therefore, the price of the insurance will become more expensive.
Capital to be insured
All companies request a number of money to set an amount of capital to be insured. A guide number to calculate this figure is based on multiplying by five the net annual salary . This reference is associated with the idea that five years is the minimum period for which people who are financially dependent on the insured can adapt to a new life situation.
If the insured amount covers a period of five years, it is very likely that the beneficiaries of the insurance have had room to adapt to this new scenario. Obviously, the longer the period to be insured (ten or fifteen years, instead of five), the more financial security it will offer to the beneficiaries.
Another very important aspect, since the beneficiaries are the figure who will receive the economic coverage of life insurance. In general, these are usually the members of a family nucleus (partner and children). The younger the children are and the more financially dependent they are – for example, the need to pay for some studies – the more capital to be insured should be considered.
Profession of the insured
Depending on the professional activity carried out by the insured, the insurance fee may increase. There are certain activities that involve more occupational risks than others, and this affects the final price. A firefighter or an employee of a security body will a priori have a higher quota than a lawyer or a clerk.
Health status of the insured
An essential condition for many insurers is to be in good health at the time the contract is signed. On some occasions, it is necessary to fill out a medical questionnaire or even undergo an examination to have an official certificate.
Taking all these factors into account, it is up to the future insured to decide what type of life insurance interests him or her. In general, insurance companies ask you to complete a short form to make an initial estimate of the price of the policy. The main data concerns the age of the insured and the capital that he is interested in insuring.