Death and TPD Insurance Premium – Factors Considered By Your Insurer
A death TPD insurance policy is meant to provide a financial safety net if you become permanently disabled or for your family in case you pass away.
This is a combined insurance policy that includes life insurance or death cover and total and permanent disability (TPD) insurance.
Most people have a death cover that pays out when they die, but if you become permanently disabled and can no longer work to earn your living, the financial blow may be just as serious. TPD insurance makes a lump sum payment in case you become permanently disabled.
Combining death and TPD cover is a cost-effective alternative to having two separate policies. However, the death TPD insurance premium rates you will get are based on several factors. Generally, any factor that has a bearing on your life expectancy is considered during the underwriting process of your policy.
The amount that will be paid out in case of permanent disability or death will directly affect the premium cost you will have to pay.
Generally, older policy buyers are subjected to higher death. This is because your insurer takes into consideration how long you would be expected to make premium payments before a claim is made, click here to know more.
When underwriting for a death cover, a healthy woman would probably receive lower premium rates than a healthy man her age. This is because the life expectancy for women is generally higher than that for men.
Some personal habits are generally considered risk factors by insurance companies. For instance, if you are smoker, this could mean higher premium rates in your policy since smoking is generally considered to increase your cancer risk. In addition, if you engage in hazardous hobbies that increase your risk of injury, your policy may have exclusions attached to it, which would mean that your claim may be declined if you get injured as a result of such hobbies.
Certain jobs are considered to carry greater risk than others. If you are a builder, for instance, you would probably receive higher premiums that a librarian because you would be at greater risk of injuries that may lead to TPD or even death.
If you have a pre-existing medical condition that leaves you vulnerable to total permanent disability or death, this may not lead to higher premiums, but it may lead to exclusions in your policy. However, previous health conditions may translate to higher premium costs.
It may be tempting to hide certain facts from the insurance company when taking out your policy in an effort to lower the premium cost. However, even if a small amount of fraud is discovered by your insurer, any claims you make could be denied. Note that different insurance companies will provide different premium rates for the same coverage. Comparing insurance products from different companies and speaking to your financial planner is highly recommended when selecting the most appropriate policy for your circumstances.