What are the factors that influence my insurance premiums?

1. What are the factors that influence my insurance premiums?

2. You may have noticed that the amount you pay for a particular insurance product – such as life insurance or health insurance – can differ from what your friend pays for the same coverage. Why is that so? Let’s take a look. The cost of insurance varies between policyholders because each insured individual represents a different level of risk for the provider. This risk is calculated through certain factors by the insurer. In this article, we take a look at some of the main factors that affect the premiums of major insurance products.

3. Health of the applicantThe presence of any ongoing diseases or pre-existing health conditions too will have an impact on your insurance premiums. Having an existing medical condition might make you more likely to make a claim (though this might not always be true). However, do not attempt to suppress any information on your medical records. If your insurer requests for you to fill up a health questionnaire, be completely honest so that you avoid facing any hurdles when you need to file a claim.

4. Age of the applicantThe life assured’s age too has an impact on the insurance premium. The older you are, the more costly your premiums get. This increase is especially evident in life insurance; therefore, it makes sense to always try to buy coverage as early as possible.

5. Lifestyle habitsIf you smoke, you are likely to face higher premiums on insurance. The reason for this is simple – smoking increases your vulnerability to many diseases, including cancer and heart problems. Therefore, smokers pose a higher risk for insurance companies as they might be more likely to file claims for ill health. While admitting that you are a smoker can lead to an increase in your insurance premiums, never attempt to hide your habit from your insurer. Doing so can lead to problems when you make a claim at some point in the future. It is better to pay a bit more and at least have the assurance that your claims will be honoured.

6. Nature of coverage chosenYour premium will also be determined by the type of plan you choose for coverage. For instance, if you opt for a whole life insurance plan instead of term life insurance, your premiums will naturally be higher. Similarly, if you add riders to your life insurance plan, your premiums will be costlier than the premiums due from someone who has simply opted to stick with the base plan. Additionally, premiums will differ between a chosen coverage amount of $10,000 versus $100,000.

7. These are the four main factors that impact the premiums you pay across a range of insurance products. There may be certain other factors that come into play for specific insurance policies too. You may speak to your insurance provider for a more detailed understanding. We hope that this article has proven to be a helpful read for you. Do remember that you can get in-depth guidance from a financial consultant while buying insurance. Always keep your coverage active so that you and your loved ones enjoy the peace of mind that insurance brings.

8. READ MORE: - Why It’s A Good Idea To Buy Life Insurance Online In Singapore (Plus, A Few Tips To Help You Out)You can even visit our Social sites:Facebook:- https://www.facebook.com/PrudentialSingapore/Linkedin:- https://www.linkedin.com/company/prudential-assurance-company-singapore/Youtube:- https://www.youtube.com/channel/UCWs_Qg2Rahok4kORir5w4eQInstagram:- https://www.instagram.com/prudentialsingapore/?hl=en

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