Insurance is all about managing risks, any insurance companies will not take any risks when rates are set, which are paid by you as premium. They would take precautions to make sure that you won't die prematurely; it may cause them to pay out more than the amount paid by you. The risk here referred is the pretty much the same health risks such as, tobacco use, cholesterol, diabetes, over weight or fat, and many other conditions related to poor health and early death. To account for these risks, insurance company would designate your status based on age, gender and health, and that would further determine how much you pay for a given amount of insurance.



The insurance company would ask you about your medical history and may want you to take some sort of physical exam as well. While filling up the health questionnaire you need to be faithful, in case you lie the company will find out and your policy would be canceled. And if in case your sick and were to die and then the company found out you lied earlier, for instance, you said you were a non-smoker but ended up dying of lung cancer from a smoking habit, they could deny the death benefits.

Some of the risk factors cannot be controlled, such as age and gender. ?Women live longer than men?, so normally women have the benefit of lower rates on insurance. And as men tend to have shorter life spans, they have the benefit of paying lower rate on annuity. Same your age also have an affect on premium. Younger people, who have much longer to pay premiums before they die, pays a lower rate compared to the older people. Your life style, your family medical history and your mental, physical condition as well matters while calculating premiums.

Most of the insurance company will ask you to undergo a physical exam, a medical doctor would check your weight, blood pressure and other vital signs, and may take a blood and urine sample. Some cases may also require extensive tests such as X-ray or EKG. Your blood and urine samples would be tested for sign of disease such as HIV virus, cholesterol level, diabetes, kidney problem, hepatitis and any other problem as well. The samples would be then screened for the findings of nicotine and some medications as well as for illegal drugs.

Some insurance companies would even improve an individual's rating, and adjust the premium, for risk factors, which reduces over time. For example someone who purchased life insurance shortly after about with his cancer, that person would possibly be paying high-risk rates because of his health history. But, because the risk of the cancer returning reduces over the years, that individual may contact the insurer after being cancer-free for five years and may get a lower rate.