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Delaying a purchase of a term policy by 10 years could cost an extra 49% for 25 year old, 76% for 35 year old and 84% by 45 year old, shows a study done by PolicyX, an online insurance distributor.
Overall, the study shows that the average premium of term insurance has increased by 13% over the last one year. The average premium of a term insurance with sum assured of Rs.1 crore has increased from Rs.23000 in September 2021 to Rs.26,000 in September 2022, shows the in-house term insurance premiun index developed by the distributor
The report attributes this to hike in reinsurers’ premium (input cost) and heightened instances of claims due to covid outbreak last year.
Further, the data shows that the average premium of Rs.1 crore term cover for 25-year-old non-smoker female is Rs.10216 as against Rs.11,440 for 25-year-old non-smoker male.
Let’s look at the table to see premium across age categories:
As you can see that the average premium of male is higher than female as according to insurance norms, the male carries a higher risk of life than the female.
Another factor that influence term insurance cover is smoking habit. Smoking habit can increase premium by over 50% in some cases.