How much does life insurance coverage cost?

The cost of life insurance coverage for an individual will vary widely according to a number of different factors.

Among the many factors affecting the cost of coverage are the amount of the death benefit, the age and health status of the insured, the term of the policy and any investment component.

As with any financial purchase the key to getting the best coverage at the best price is to shop around as much as possible.

How do life insurance companies determine premiums?

While each company offering life insurance coverage will have a different formula for determining monthly premiums, in the end it all boils down to the actuarial tables.

Actuaries are specialized professionals who use a variety of statistics to determine the likelihood that policyholders will die during the life insurance term. Crunching these numbers allows life insurance companies to rank the risk of applicants and determine the proper premium levels.

See also: What is a health classification?