Premiums for term life insurance are the price you pay the insurance company for your life insurance policy. Premiums are usually paid every month or once per year.
Your premium is the rate times the amount of life insurance coverage you buy.
You pay a specific rate per $1,000 of life insurance. So, if your rate is $5 and you buy $200,000 of life insurance, the premium per year would be 5 X 200 which equals $1,000.
How are your term life premiums determined by the insurance company?
The rate per $1,000 of term life insurance is based on your risk factors, and amount of life insurance, as well as, the length of term - 10, 15, 20 or 30 years of coverage. In addition, your age and gender affect your rate for life insurance.
Risk factors are variables that affect how long you are expected to live, including your age, gender, health, occupation, hobbies, lifestyle, tobacco use and driving record, among other things.
Do term life insurance premiums increase?
It depends on the type of term life insurance policy you buy.
Annual renewable term life insurance is life insurance for a period of one year and has premiums that increase each year you renew your policy.
Level term life insurance lasts for a term of 10, 15, 20 or 30 years usually, and has level premiums for the entire term (duration) of your policy.
Here's how you can compare level term life insurance quotes online