Younger clients, especially, might not understand that underwriting life insurance based on health is legal, or how much getting older affects premiums.
Policygenius, for example, shows in its monthly index that, for a woman applying for $1 million in term life insurance who is a nonsmoker, the monthly premium starts at $33.77 at age 25, rises to $43.70 at age 35 and climbs to $90.29 at age 45.
USAA recently shared preliminary results from an online consumer survey of 1,114 U.S. adults ages 18 and older. About 26% of the participants who were 55 and older agreed that “you should get life insurance at an earlier age” is the message they would most likely tell their 10-year-younger selves about life insurance.
About 18% of the participants 35 through 54 said they would tell their 10-year-younger selves that.
The percentage of participants who reported having no life insurance was 57% for participants 18 through 34, 55% for participants 35 through 54 and 45% for participants 55 and older, even though 27% of the participants in all age groups said they expected to die suddenly, with less than a month’s notice.
Carter said age was just one topic that financial advisors should bring up when talking to clients about the importance of buying life insurance sooner rather than later.
Another is the fact that consumers can’t simply take group life coverage from one employer to the next employer when they change jobs.
But life insurance does get more expensive as clients age, and “with life insurance, being proactive is better than being reactive,” Carter said. “None of us can predict when our health might change. But what we can predict is that we’ll be older next year. So, to protect our future insurability, and obtain the best rates, we should consider coverage at the youngest age possible.”
Pictured: Brandon Carter. Photo: USAA