What may affect life insurance premiums and eligibility?

Key takeaways

• Life insurance premiums are usually based on a range of personal and policy factors
• Age, health, occupation and hobbies can all play a role in how an application is assessed
• Some jobs or activities may lead an insurer to ask for more information before confirming cover or pricing
• The type and amount of cover you choose can also influence the premium you pay

Life changes over time. You might start a new job, take up a hobby, review your health, buy a home or grow your family. These moments can be a good reminder to check whether your life insurance still aligns with your circumstances. Here’s what can influence life insurance premiums and eligibility, and what to keep in mind before you apply.

How life insurance applications are assessed

When you apply for life insurance, the insurer reviews the information you provide as part of the application process.

With Real Life Insurance, this includes health and lifestyle questions that help assess your application. Depending on your circumstances, this may affect whether cover is available or the premium you pay.

Before deciding if the product is right for you, it is important to read the Product Disclosure Statement (PDS), so you understand the policy terms, conditions, limits and exclusions.

Learn more: What is life insurance?

How higher-risk factors may affect your application

Being considered high-risk does not always mean your application will be declined.

In some cases, an insurer may offer cover with terms that reflect your work, hobbies, health or lifestyle. This could include adjusted premiums or specific policy conditions.

Occupations that may affect a life insurance policy

Two people can have very different working lives, even if their job titles sound similar. One person may spend the day in an office. Another may work at heights, drive long distances, operate machinery or respond to emergencies. That is why insurers often look at your actual duties, not just your role on paper.

Examples of occupations that may affect a life insurance application include:

• Miners
• Roofers or window cleaners
• Construction workers
• Armed forces
• Doctors, nurses and healthcare workers
• Police officers
• Scientists

Each application is reviewed based on the individual’s details, including the duties and risks involved in the role.

Could life premiums change if your job changes?

Your premiums may change if you switch to or from a high-risk job, depending on your insurer, policy and the details of your role.

If you move into a lower-risk role, it may also be worth asking whether your policy can be reviewed. Occupation can affect cover, so consider contacting your insurer when your job changes to understand what it may mean for your policy.

Sports and hobbies that could impact your life insurance policy

If an activity involves a higher chance of serious injury, the insurer may ask for more detail before confirming your options or the premium that applies.

High-risk sports and hobbies may include:

• Skydiving
• Scuba diving
• Outdoor rock climbing
• Car, motorcycle or boat racing
• Aviation (non-commercial piloting)
• Extreme sports like white water rafting and bungee jumping

How age affects life insurance premiums

Age is one factor that can affect life insurance premiums. In general, the older you are when you apply, the more likely it is that your premium will be higher. This is because insurers consider the likelihood of a claim over time, and age forms part of that risk assessment.

Age can also influence the type of cover that may suit your needs. For example, some people may want cover for a set period, while others may want cover that lasts longer. The right option will depend on your circumstances, budget and the policy terms.

How health and medical history can affect life insurance

Health and medical history are often central to a life insurance application. Depending on the product and the insurer’s process, you may be asked about current conditions, past diagnoses, treatment, medication and other relevant medical details. Those answers can affect both the price of cover and whether any special terms apply.

Mental health may also be considered as part of your application. The outcome will depend on the insurer’s assessment and the details you provide. In some cases, your health or medical history may lead to standard cover. In others, the insurer may offer cover with adjusted terms, depending on the details of your health and medical history.

Learn more: Can I get life insurance without a medical?

How lifestyle choices affect life insurance

Lifestyle choices can also affect life insurance premiums and eligibility. Insurers may ask about factors such as smoking, alcohol use, drug use and other habits that may influence your health or likelihood of making a claim.

Smoking is one of the most common lifestyle factors that can affect premiums. People who smoke may pay more for life insurance than people who do not smoke, depending on the insurer and product.

Alcohol and drug use may also be considered, particularly where it affects health, safety or medical history. The insurer may ask questions to understand the frequency, amount and any related health impacts.

Policy choices that can also affect premiums

Your premium is not only shaped by personal factors. The policy choices you make can also affect how much you pay.

The amount of cover is a key factor. In many cases, a higher benefit amount will cost more than a lower benefit amount. Optional benefits or additional cover features may also increase the premium.

The structure of the policy can matter too. Some policies are designed to provide cover for a set period, while others may provide cover for longer, depending on the terms. Premiums may also be structured differently depending on the product, such as premiums that increase with age or premiums that are designed to start higher but change differently over time.

Before choosing cover, think about who and what you may want the policy to help protect financially if you were no longer around. This may include mortgage repayments, debts, everyday living costs, education expenses, or support for your family. Moneysmart’s life insurance calculator may help you think through how much cover you may need.

Understanding your options with confidence

Life insurance premiums and eligibility can be influenced by your age, health, work, hobbies, lifestyle and the type of cover you choose. These factors do not automatically mean cover is out of reach, but they may help an insurer understand your circumstances.

Taking the time to understand your options can help you make a more informed decision about cover for your needs, budget and loved ones.

With Real Life Insurance, you can apply over the phone or request a quote online.

Frequently asked questions

Is life insurance guaranteed?

Life insurance is not guaranteed. An insurer will assess your application based on factors such as your health, medical history, occupation, lifestyle and hobbies. Depending on the outcome, cover may be offered on standard or adjusted terms, or may not be available.

Does life insurance cover extreme sports?

Life insurance may cover extreme sports, but it depends on the insurer, the activity and the policy terms. Some activities may affect how your application is reviewed or the terms that apply.

Does riding a motorcycle affect life insurance?

Riding a motorcycle may affect life insurance if the insurer considers it relevant to your risk profile. Everyday riding may be assessed differently from racing or competitive motorsport. The impact will depend on the insurer, your riding habits and the policy terms.

Does BMI affect life insurance?

BMI may affect life insurance because it can form part of an insurer’s assessment of your overall health. It is usually considered alongside other health and lifestyle factors, rather than on its own. The outcome will depend on the insurer’s application process and policy terms.

Does smoking affect life insurance?

Smoking may affect life insurance premiums. Insurers commonly ask about smoking because it can influence health risk and pricing. The impact will depend on the insurer and product.