The role of health and lifestyle in life insurance costs

There’s a science behind insurance. In the simplest terms, how much a person pays for insurance (be it car, boat, pet, home) is based on that person’s risk or, in longhand, that person's risk of making a claim.

Take car insurance. If you have a 25-year-clean license, haven’t ever crashed and live in a low-crime area, your car insurance won’t be too expensive. You’re low risk because the chances of you claiming are relatively slim.

Life insurance is the same but the key factors that determine your risk mostly involve your health and lifestyle. In a nutshell, the healthier and more active you are, the lower your risk … and the lower your cost. 

Let’s meet your clone

Let’s run a little thought experiment to dig into life insurance costs and how they differ. To do this, you’ll need to imagine a clone of you suddenly pops up. Your clone is a clone - exactly the same as you in every conceivable way. 

Now imagine that, one day, you and clone-you both decide to apply for life insurance … 

The policies (yours and your clone’s) will cost the same because you present precisely the same level of risk.

But that changes when you throw in a health or lifestyle variable. Say you’re a healthy weight but your clone is overweight – they’ll probably pay more. Say you don’t smoke but your clone does – they’ll pay considerably more. Say you both have diabetes but you manage your condition well and keep good general health yet your clone does neither … they’ll pay more. 

Again, it’s a matter of risk. Keep an active and healthy lifestyle, keep your weight under control and avoid bad habits and your life insurance won’t weigh as heavily on your pocket. 

Can clone me claw it back? 

Yes, it’s possible. Let’s imagine clone-you is shocked they have to pay more in life insurance than real you and decides to address some of their riskier health and lifestyle behaviours. 

The first thing clone-you can do is to check what life insurance benefits are part of their policy, and access professional support services that’ll help them on this new health journey.

Smoking

Smoking is still one of the biggest if not the biggest variable in determining a person’s health risk. If you and clone-you apply at the same time, but clone-you smokes and you don’t, clone-you can expect to pay between 33% and 50% more for life insurance as a result. 

But let’s say clone-you books an online mental health consultation (through the insurer) to get help kicking the fags. Imagine they quit and stay quit. 

After a certain period of time (typically a year) off the smokes, clone-you can call for a policy review and it’s possible they’ll be given cheaper, non-smoker rates. 

Diabetes

Say you and clone-you both have a chronic illness. We’ll again use diabetes as an example. 

Say you both have it but you manage your condition well and keep great general health. Now let’s say clone-you doesn’t. It’s likely clone-you will pay more in premiums. 

But let’s say clone-you decides to start anew and makes a fresh commitment to healthy living and regular exercise. They might first go for a health MOT (free through the insurer) and then consult a nutritionist, then a fitness expert then they may make regular use of free virtual GP appointments. 

Might all that extra effort bring down the cost of your favourite clone’s premiums?

Again, it can. When a customer has diabetes, most life insurers will ask for recent blood sugar readings. Alongside a customer’s overall health profile, these numbers inform the customer’s risk and if there’s a massive improvement in readings and overall health then clone-you’s premiums may be recut on that basis. 

Health and lifestyle

As fun or as frightening as it is to imagine there’s a you-clone, science isn’t quite there yet. 

For our purposes, the science is simpler: medical science says a healthy lifestyle is your best chance of a longer life, and actuarial science (the type us insurers use) says a healthy lifestyle is your best chance of keeping premiums low. 

It’s never too late to start addressing your risks and, through your life insurance, you may be entitled to free support to help to see in your health goals. 

That’s great for wellbeing and happiness, but it just might save a few bob too.