Which factor typically leads to higher life insurance premiums?

In the context of life insurance, the increased age of the applicant is a primary factor that typically leads to higher premiums. As individuals age, they are generally perceived to have a higher risk of mortality. Insurers evaluate life expectancy based on various factors, including age, which plays a significant role in their underwriting process. Older applicants may have underlying health conditions or decreased overall health compared to younger individuals, which can contribute to a higher likelihood of claims being made on policies.

Insurance companies need to balance the risks they take on when providing coverage, and age is a critical component of that evaluation. Therefore, as people grow older, the premiums they are quoted tend to reflect that increased risk of death, which is why the cost of life insurance policies usually escalates with age.

In contrast, factors such as being female, being young, or maintaining good health typically correlate with lower mortality risks and, as a result, lower premiums.