Protecting your loved ones against the uncertainties of life is always a priority. Along the way, you strive to provide for your family and give them a lifestyle they deserve. But have you ever imagined what will happen to their dreams and aspirations if something happens to you?

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In case you are the sole breadwinner in your family, your absence would hurt your family both emotionally and financially. Which is why it is crucial to have term insurance in place to ensure a financial safety net for your dear ones in your absence.

A term plan financially prepares you against life’s eventualities and is one of the most cost-effective methods to secure your family’s financial requirements. To be certain that you have the correct term plan for your family, you need to consider several factors, out of which premium payable under the plan is a crucial determinant.

Premium rates of term insurance plans in India are determined through mathematical and statistical calculations done by the insurance company. Many leading insurers like Future Generali also provide premium calculator facility for their customer’s ease.During the calculations, risks that reflect the livelihood of the buyer plays an important role. Lower the risks, lower are the premiums.

In this article, we have jotted down some factors that can help you lower the premium amount.

  1. Start Early

When you purchase a term plan in your 20’s, the premium rates are lower. The reason being-the younger you are, the healthier you are! As you grow, the chances of you contracting critical illnesses and other lifestyle diseases increase. It is mainly due to the sedentary habits that come along with our regular 9 to 5 jobs. When you are in your 20’s the risks associated with your health are low, so the insurer does not mind offering lower premium rates.

2. Refrain from Alcohol and Smoking

Alcohol and smoking are two factors that deteriorate your health and increase mortality risks. Which is why every insurer asks you to disclose these habits at the time of purchasing the policy. Smokers or even occasional smokers are required to pay higher premium amounts than non-smokers.

This case is similar with regular alcoholics as excessive alcohol can damage your liver and other vital organs. Therefore, insurance companies charge higher rates to individuals who frequently drink and smoke as they are more susceptible to diseases and other health problems.

3. Be Wary of Occupational Risks

Many times, your choice of hobbies like boxing, scuba diving and skydiving can make insurers apprehensive on the risk factors involved. Due to these factors, insurers may consider you a high-risk investment and thereby, charge higher premium rates no matter how healthy you are.

Moreover, insurance companies also charge high premium rates if your occupation is life-threatening. Every insurance company has a list of occupations and the risks associated with the jobs, to decide the premium rates.

4. Obesity

Obesity is a significant issue faced by a rising number of adults in India. It is a medically recognized condition that is defined by the amount of excessive fat content in the body. Excessive obesity many times leads to a number of heart diseases, blood pressure problems and diabetes. Therefore, insurance companies charge higher premiums to individuals who are obese. Put simply, if you want to reduce the amount you pay as your premium, you will have to reduce your weight too.

Bottom Line

The above factors which are associated with your life and decisions can have an impact on the amount you pay as your premium. However, while purchasing term insurance plans in India, if you take care of these factors, you can reduce your premium amount without compromising on your coverage.

By Eddy

Eddy is the editorial columnist in Business Fundas, and oversees partner relationships. He posts articles of partners on various topics related to strategy, marketing, supply chain, technology management, social media, e-business, finance, economics and operations management. The articles posted are copyrighted under a Creative Commons unported license 4.0. To contact him, please direct your emails to

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