Insurance policies are taken primarily to leave our family financially safe after us without any hassle in money requirements. There are policies like endowment and other such policies would help you to fulfill this thought but the premium for these policies is high. Further, the coverage that we would enjoy through this is also comparatively less. Naturally, people are changing to term life insurance policies that give more coverage amount from fewer premiums. However, while taking term life insurance policy the premium amounts are being fixed high at times. What is the reason for this? Which are the situations that needs to pay high premium?
Term Life Insurance Policy – Terms
When a person is fit and healthy both physically and mentally, a term insurance policy is provided without any pre-conditions. However, people would have spoiled their health from the normal status of their age comparing to others which could lead to a shorter life expectancy. To these people, one cannot say NO in taking an insurance policy for their coverage as said by the IRDA which regulates the insurance companies. At the same time, while providing policies to the above said persons (who are not healthy enough) the insurance companies can increase the premium amount as allowed by the IRDA. Especially who are having smoking habits are prone to cancer and for them when they go for term plan the premium amounts are fixed higher than usual. Also, for those who has diabetes mellitus can pay a higher premium to take a term life insurance policy. But not all the insurance companies follow the same scale in deciding the premium amount.
Individual who are in risky jobs that is prone to health defects and sports persons also have to pay a high premium to obtain a term life insurance policy.
Adventurous Sports Personnel
People involved in mountaineering, adventurous sports, water sports, parachute players etc who have involved in these sorts of sports knowing the risks of their life need to pay high premium to take a term-insurance.
Prone to Sexual Diseases
Those who do not follow the sexual honesty and are prone to sexually related diseases have to pay increased premium as having multi-physical contacts would lead to all kinds of sex-prone disease.
Persons with certain diseases and conditions which are medically found to be rare or non-curable need to pay a high premium. Condition such as hemophilia will come under this criterion.
More concentrated jobs or high-risky jobs would require more premium to take a term life insurance policy. Especially, those who are in car or motor racing, defense jobs, pilots, fire department jobs etc.
Irregular or Temporary Jobs
Individuals with no permanent job or irregular jobs will be charged with a high premium as their source of income is not sure.
Nature of Illness and Health Level
People with chronic diseases and with illness that would lead to death are charged with high premium based on the level and condition of their illness. Insurance will be provided to them only after a medical checkup. Those who have undergone heart and lungs related surgery, or with paralysis, cancer etc will have to pay a high premium. These people can take a tiger policy separately to equalize their income.
Almost all health related issues are known through a medical checkup before finalizing the insurance premium. Generally, people in the age group of 35 to 40 and taking a coverage of Rs. 20 Lakhs doesn’t need a medical checkup.
For no reason one should hide their medical ailments just to reduce your premium amount as there would be risk later when you claim the coverage. However, there won’t be any hike in the premium amount when the diseases found in between after taking the policy.
By all means a term life insurance policy is the best one if you have realized the purpose of an insurance policy to boost your beloved ones or nominees after your period, financially. The best advice to take up this insurance policy would be to start with this while you have started to earn or at the early age of 25 itself.