Life Insurance Premium Calculator

What is Life Insurance Premium?

Life insurance premium refers to the amount that you need to pay towards your life insurance plan. It is basically the amount that is paid in exchange for getting life insurance coverage. If the policyholder has been paying the premiums on a timely basis, then you will get adequate coverage. However, if you fail to pay the premium on time, then the life insurance policy will lapse after some time. The life insurance premium calculator helps in determining the premium of the life insurance according to certain factors such as age, gender, sum assured, riders, Body Mass Index (BMI), personal habits etc. of an individual.

How Life Insurance Premium Calculator Helps?

The online tool of life insurance premium calculator helps the policy buyers find out life insurance premiums in a simple and quick manner. Life insurance premium calculators provide premium calculation results instantly. The online tool considers variables like age, gender, cover up, life cover, personal habits like consumption of tobacco/alcohol and more for calculating the life insurance premium amount.

Life insurance premium calculator at InsuranceDekho is an easy-to-use tool that helps a potential life insurance policy buyer make an informed decision for their life insurance plan. Below mentioned are some of the benefits of using InsuranceDekho Life Insurance Premium Calculator:

• Estimate Life Coverage: The tool helps you to opt for the highest possible life cover amount that suits your budget. An individual can also opt for additional benefits at the best possible rate of premium offered by the life insurance companies.
• Calculate the Premium: Using this life insurance online tool can help you instantly calculate the premium. It helps in saving time.
• Choose the Right Plan: A life insurance premium calculator offers the flexibility to make decisions without the influence of an agent that generally affects your choice. It helps in making better decisions in terms of choosing a plan that best suits you.
• Saves Time: Life insurance premium calculator helps you save time. Since there is no manual calculation of life insurance premiums involved, one gets the desired premium amount results within no time.

How is Life Insurance Premium Calculated?

You can easily calculate premiums for a life insurance plan with the help of the InsuranceDekho’s Life Insurance Premium Calculator. The premium of the life insurance plan depends on the sum assured and other factors such as age, gender, cover-up, riders, and personal habits like consumption of tobacco/alcohol. The premiums are determined by the insurance providers and differ from policyholder to policyholder. The calculation of premium can vary depending on the change in the variables and premium payment frequency.

Types of Life Insurance

If you are planning to buy life insurance, you should also be aware of its different types. To help you out, we have enlisted the broad types of life insurance:

• Term Insurance: Term insurance is a type of life insurance plan that protects your loved ones in case you meet an unfortunate death. It is a pure protection plan that is unaffected by market fluctuations and aids the beneficiaries of the policyholder even when the latter is not around.

• ULIPs: ULIPs or Unit Linked Insurance Plan provides the benefit of both insurance and investment. A certain amount of money goes towards insurance and the remaining is invested for wealth creation.

• Endowment: An endowment is an insurance plan that provides a sustainable source of income as well as life insurance protection. Upon maturity of the plan, you will also receive a lump-sum amount.

• Money-back Plan: A money-back plan is a type of insurance plan where you receive a certain amount of money at regular intervals. With money-back plans, you can get a monthly as well as yearly source of income.

• Retirement Plan: A retirement plan is another type of insurance plan that lets you create wealth for your post-retirement days. With retirement plans, you can also enjoy tax benefits under section 80C of the Income Tax Act of 1961.

How to Use a Life Insurance Premium Calculator?

There are many insurance companies competing with each other and each one of them has a different procedure of calculating the life insurance premium. At InsuranceDekho, you need to provide the following information in order to calculate the premium for your life insurance plan:

• Enter your Age
• Select the amount of sum assured
• Select your Gender
• Select ‘Yes’ or ‘No’ to confirm your consumption of tobacco/alcohol
• After this, you will get the premiums for the quotes of your life insurance plans.

Benefits of Using Life Insurance Premium Calculator Online

Using a life insurance premium calculator online can offer several benefits for individuals looking to purchase life insurance. Here are some advantages:

• Time-saving: Life insurance calculators provide a fast and convenient way to estimate life insurance premiums. You can access them from the comfort of your home or anywhere else depending on your comfort. You just need to enter a few details to view the premium details.
• Comparison: Another benefit of using a life insurance premium calculator online is that it allows you to compare premiums from different insurance companies. This helps you find the most competitive rates for the coverage you need and thus buy the right life insurance plan.

• Cost-effective: When you use the online calculator for premium calculation, you need not visit the branch office to get such details. Thus, instead of visiting the branch office, you can simply use the premium calculator and save on additional expenses.

• Accessibility: Online calculators are accessible 24/7, allowing you to revisit and adjust your calculations as needed. This flexibility is particularly useful if you are researching or planning your life insurance needs at any hour of the day.

Factors Affecting Life Insurance Premium

The premium of life insurance is calculated after considering the following factors:

1. Age: Age is an important element considered to calculate the premium for a life insurance plan. The reason behind age being an important variable in the premium calculation of a life insurance plan is that younger people are less likely to catch diseases and are considered in a low-risk category. Usually, premiums for life insurance are lower when you purchase it at a young age rather than at an age where high risk is involved and premiums are also higher.
2. Gender: Some insurance providers offer less amount of premiums for women. There is scientific and statistical evidence that reveals that women are likely to live more than the average age of a man. This allows women to take advantage of life insurance plans for a longer policy tenure which calls for lower premiums.
3. Medical Records: When you are purchasing a life insurance plan it is necessary to go through medical examinations. These medical examinations help in determining your current health status and help in determining any potential diseases that might occur in the future. Obtaining the results from the medical examination helps in calculating premiums for life insurance plans.
4. Personal Habits: Personal habits like the consumption of tobacco/alcohol can affect the calculation of premiums for a life insurance policy. Consumption of tobacco and alcohol is considered harmful to an individual's health. People who consume tobacco/alcohol are more likely to catch different diseases and are considered in a high-risk category. Therefore, the premium rates for non-tobacco/alcohol consumers are low and rather high for people who consume tobacco/alcohol.
5. Medical History: In case, the medical history of a policyholder showcases serious illnesses like heart disease, cancer, or any other, then the insurance companies consider the policyholder to be on the higher side of risk. In a case like such, the premium of a life insurance policy can increase with a significant margin, thereby affecting the ultimate premium amount.
6. Profession: The occupation or profession of a policyholder plays a vital role in deciding the premium they will have to pay for a life insurance policy. For instance, if a life insurance policy buyer belongs to dangerous professional backgrounds such as mining industry, fisheries, oil and gas, or any other, they will have to pay a significantly higher premium amount for the policy they want to purchase.
7. Policy Term: The policy term or policy duration is also one of the crucial aspects that affects the life insurance policy premium. Note that the longer the tenure of the policy will be, the larger will be the amount of the benefit at the time of the policyholder’s death. Why? It is because the policyholder would be paying the premium for that time period. If we talk about short term policies, they are more expensive as compared to those that have a long term.
8. Lifestyle Choices: Your lifestyle choices can also end up in having you pay a lot more than you expected. Take note that many insurers keep a higher premium for people who love to get involved in adventurous activities for the purpose of thrill. If you, as an individual, are of the adventurous kind and get involved in activities concerning speeding cars, climbing mountains or other high risk activities, you may have to pay a much more premium amount than you expect due to the nature of high risk involved.
9. Obesity: Obesity is also one of the key aspects that can affect the life insurance policy premium you wish to buy. As a policyholder, if you are obese, you would be considered at high risk for a series of health problems such as Osteoarthritis, Cancer, Stroke, High Blood Pressure, Coronary Heart Disease and more that can result in severe health problems in the future. As a result, you will have to pay a higher premium as compared to non-obese individuals.

Tips to Reduce Life Insurance Premium

Here are some tips that can help you reduce the life insurance premium:

1. Buy Policy Online: Premiums for life insurance plans purchased online are comparatively less than purchasing them offline as it requires no additional cost of purchasing them directly from the insurance company or any agents.
2. Avoid Consumption of Tobacco/Alcohol: Consumption of tobacco/alcohol are harmful to a human being’s body. Health is considered the most important factor while calculating the premium for a life insurance plan. The premium rates for non-tobacco/alcohol consumers are low and rather high for people who consume tobacco/alcohol.
3. Choose the Best Possible Policy Term: The time period of the whole policy tenure also plays an important role in the calculation of policy premiums. If you purchase a policy for a longer term then the premium for the life insurance will be low as compared to premiums for a short policy tenure.
4. Add Riders Only If Required: When you purchase life insurance you get an option to purchase additional coverage with a life insurance plan. Choose the riders wisely and opt for them only if you genuinely require them because riders increase the number of premiums.

Can You Depend on Life Insurance Premium Calculators?

Life insurance premium calculators are backed by a thorough process of calculating the policy premium rates. This online tool considers a vast array of elements like age, gender, sum assured, and more into account for calculating the insurance premium. As compared to manual calculation of premium, an online tool can be highly relied upon as there are no chances of error. Human errors can be expected while doing manual life insurance premium calculations, but a calculator can be depended upon for giving the most accurate results.

Summing Up

Thus, it can be said that the life insurance premium calculator provides premium calculation in a few minutes and is thus a useful tool. The entire process is smooth and seamless as compared to the manual process, therefore the online life insurance premium calculators are highly recommended.