The amount you pay for your life insurance is very dependent on what rate class you fall into. And today more than ever before, insurance companies are dividing their clientele into more and more rate classes. This allows insurance companies to give you a life insurance rate that is more accurately determined by your lifestyle. Therefore, the more you fit with their criteria, the lower your rates will be. The further you are away from their ideal applicant, the more you will pay. Therefore, it is very beneficial to know what class you fall into so that you will have an idea as to whether your will qualify for life insurance and what life insurance rate you might be quoted.
Your life insurance company is a business. And businesses have to assess risk when they invest in something. When it comes to life insurance, risk factors can cost you significantly when you are looking to get the best life insurance rate. Things like weight, tobacco use, blood pressure, cholesterol levels, driving record, family history, and even citizenship all relate to your risk level, hence your class.
Some companies look at more than just your health history. Sometimes your credit score and current occupation also play into what rate class you are in. Insurance companies vary on the amount of classes and the number of factors that they weigh to put you into a class. However, do your research to find out what factors are preventable. Remember, the healthier your lifestyle, the lower your rate.
We all want to look for the best deal, and getting into a better rate class is part of that deal. There are a number of common factors amongst life insurance companies that you can work on. For instance, if you smoke - quit. That may sound simplistic, but almost all insurance companies ask you about your tobacco use. Remember, these are assessments to determine your risk of dying, and smoking is extremely risky.
You can also begin exercising and eating healthier. A proper diet and exercise regime means lower weight, blood pressure, and cholesterol levels, all of which parlay into lower life insurance rates. Even making sure you pay your bills on time and build up your credit rating can help.
No matter what class you are in, it is important to get the best rate for your life insurance. However, don't necessarily be fooled by the lowest dollar amount. Make sure you check into each insurance company before you buy to make sure they have good ratings. Yes, insurance companies are rated, too.
How do you determine ratings? You can check with companies like Standard and Poor's (www.standardandpoors.com) or A.M West (www.amwest) to find out the quality of the companies you are considering. These rating companies conduct extensive reviews including interviews with the management of the companies to determine the quality of service. Make sure your company has an AA or A rating, as they mean that the company has a very strong ability to meet its financial obligations. Going with a company rated lower means you are only getting an adequate chance that the insurance company will be able to meet those same obligations. Is adequate enough for your family?
Even though there are a number of factors that you can do nothing about, like your past history, citizenship, or your family medical history, there are a number of risk factors that you have control over. If you are looking for the best life insurance rate, controlling the factors puts you in the right class. Plus, making sure your company is in the right class means more financial protection. So when it comes to life insurance rates, class is everything.