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Looking back at a year of life insurance rates: Policygenius Price Index special analysis

Insurance Forums Staff

Analysts took a look back at a full year’s worth of life insurance rates and how they’ve fluctuated during the coronavirus pandemic in the latest release of the Policygenius Life Insurance Price Index, which displays average monthly life insurance rates using current data from leading life insurance carriers.

Policygenius, the nation’s leading online insurance marketplace, recently released April data. The April 2021 index special analysis shows that compared to April 2020, older smokers can now expect to pay slightly higher life insurance premiums, whereas nonsmokers have not seen substantial rate changes.

For example, 55-year-old male smokers are paying nearly 4% more in April 2021 for a $250,000 term life insurance policy than they were in April 2020. In general, older smokers have seen the steepest increases in life insurance premiums throughout the year.

Overall, healthy demographics have not seen major life insurance pricing changes over the past year. In fact, some nonsmokers saw a nominal decrease in pricing from April 2020 to April 2021.

“Age and health play a big part in determining life insurance rates, and we’ve seen that play out as insurers have navigated the pandemic this year,” Jennifer Fitzgerald, CEO and co-founder of Policygenius, said. “As some studies have found that smokers are at higher risk of developing severe COVID-19 outcomes, it’s likely that the pricing increase for that demographic is due to insurers adjusting their underwriting process for that group, though this may not be the only factor at play. Overall, life insurance rates have not been significantly impacted by the pandemic, and there continue to be many affordable options for people to find coverage.”

Insurance rates can vary as the market fluctuates, as well as when a shopper’s personal profile changes. Life insurance prices are primarily based on life expectancy while also factoring in personal details about an individual, including age, medical history and hobbies. Prices also depend on the length of a policy and how much coverage a consumer opts to get.

“As we look back on an unprecedented year and the changes it brought on, we’re proud to continue helping Americans with all health profiles learn about insurance and find the financial protection that best suits their needs,” Fitzgerald said.

The prices included in the Policygenius Life Insurance Price Index are based on internal actuarial rate tables for 11 of the life insurance carriers that offer policies through the Policygenius marketplace. The prices represent the average monthly premium for each sample customer profile (age, gender) and policy type (term, coverage amount) as of the most recent publication date. New data from this free index is published on a monthly basis to illuminate pricing trends for consumers.

Launched in 2014 as one of the early insurtech pioneers, Policygenius, with headquarters in New York City and Durham, N.C., says it has helped more than 30 million people shop for all types of insurance online, and has placed over $75 billion in coverage.



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