Insurance That Fits Your Individuality
When an accident occurs and the unexpected knocks us off our feet, insurance offers physical and financial protection by picking up a portion of the bills and restoring lives to normality.
But the type and variety of insurance protection that's needed varies from one individual to the next, depending on factors like age, income and marital status.
Tailoring Policies to Fit
Like a pair of ill-fitting pants, one-size-fits-all plans can leave policyholders vulnerable and lacking coverage. But with insurance plans tailored to fit individual situations, everyone can rest assured there's protection available when it's needed most.
Evaluating Risk
Insurance companies base premiums on a number of factors that help them evaluate the risk policyholders present. This includes both risk of accident and risk of claims resulting from accident.
Agents typically classify insurance coverage in one of three categories:
- High risk
- Medium risk
- Low risk
In general, the lesser the risk, the cheaper the premium. The converse is also true: the higher the risk, the more expensive the premium. However, since some life factors weigh in more heavily than others when it comes to setting rates, let's take a look at those factors and their effect on the bottom line.
Factors that Influence Rates
Age
One of the most influential factors that help insurers set rates is the applicant's age. Depending on the type of protection desired, age can have a positive or negative effect on overall premiums.
For example, young teens and students typically present high risk while driving the family car. Due to lack of experience, the likelihood of distraction and other related factors, teen car insurance tends to cost more than the same type of plan for any other age, such as plans that fit those in their later years.
When it comes to health insurance coverage, however, teens present much less risk simply due to youthfulness. That translates into cheaper health rates for the youthful and higher rates for seniors, whose risk levels tend to be higher due to advanced age and longer life. That results in greater need for health, life and long term care protection, and greater likelihood of claims under those types of policies.
Income
The higher the applicant's income, the less likely he or she is to file claims, especially when it comes to smaller claims and lesser payouts.
When low-income families suffer loss and need help recovering, they're more likely to file for reimbursement needed to get medical treatment, make repairs to damaged homes or cars or pay the bills of others for whom they're financially responsible...and that means higher premiums.
Marital Status
Research shows that married people tend to be healthier and happier than singles. That means fewer trips to the doctor, less likelihood of illness and lower health rates.
Once married, most people settle into routine, more predictable lives than they lived while single. Overall risk goes down markedly when policyholders wed because many no longer participate in riskier behaviors they may have previously enjoyed.
Singles, on the other hand, may not think twice about engaging in dangerous hobbies or occupations, since those activities affect only them. As a result, they present greater risk to insurers and carry higher rates as a result.
Finding Affordable Coverage
Find out how characteristics like age, income and marital status affect rates. Then request a tailor-made policy that fits your individuality today.
