How does the Insurance Company calculate my premium?

The cost of your policy is based on the risk to the Insurance Company of having to pay out.

When an Insurance Company calculates a premium, it is basically working out how long they expect you to live. The important factors in making the calculation are your age, whether you smoke, your health record and your occupation.

When the Life Insurance Company receives an application, they will use the information supplied to decide whether cover can be offered straight away, or whether more information is required.

If more information has been requested, this goes to one of the Underwriters, whose job it is to assess the level of risk they think you represent. They will use Actuarial Tables which are based on the company’s experience over millions of insurance policies.

In a small number of cases an application will be turned down because the Underwriter judges that the risk is too high.

Please note : The information contained within the FAQ section has been written by Mortgage Protected Online

Related questions:

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If I’m asked for additional information or a medical, will I have to pay more?

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