Whilst it may be easy to receive a quote for life insurance, it is not until you and your life insurance company agree on the rate of the contract that you will know exactly how much you’ll be paying.

Rates can vary depending upon a number of factors, and it is up to you to find the cheapest rates possible. Here are just a few examples of the sorts of things life insurance companies may use to determine your rates and premium -

1) Your age.

Your age can play a large factor in determining your life insurance rates, as obviously the older you get, the greater your chances of dieing. Premiums will typically be lower for younger people. If you are young and are planning to take out life insurance you may want to consider purchasing fixed rate life insurance, that way you can stay on the same plan even as you grow older. On the other hand, you may want to purchase a more variable life insurance plan if you’re not planning to use life insurance in the long term, or if you think that you may later renew or change your plan as you grow older. In this case, taking advantage of the cheaper rates of being young can be a huge benefit, but may not pay off in the long run.

2) Your medical history.

It is no surprise that life insurance companies will usually take your medical history into account when determining your premium. Some companies will ask you to perform a health check before committing yourself to a specific plan, and this can be a great opportunity to prove that your healthy, and unlikely to die anytime soon, thereby attracting lower rates. Things such as smoking, obesity, mental illness, or any other form of ailment may effect the rate of your premiums, therefore it’s a good idea to compare the rates of all the life insurance companies to determine those that give you the greatest benefit for not having any physical or psychological ailments, and if you do, finding the companies that will penalize you the least.

3) Location.

Believe it or not, but where you live may also play a part in determining the rates of your life insurance. A high crime area which has many murders each year may be attract a higher premium that a quite, suburban neighbourhood. The reasons for this should be quite apparent.

4) Your Job.

Some jobs have a higher risk of mortality than others. If you work in a high risk environment, then this may attract higher premiums and rates than if you worked in a less harazardous environment. You may want to check whether or not there are life insurance companies that provide specialized cover for your job if you work in a high risk occupation, such as the military. Sometimes there may even be government benefits available in addition to the life insurance policy.

Hopefully this list has shown you some of the potential things that can effect your life insurance rates. Before signing up for to any policy, make sure to compare it to others available online, so that you can find the best rates available. Remember though that you don’t want to go with any “overnight” insurance companies that may not pay out your premiums in the event of your death. Sometimes, cheaper isn’t better - your aim should be to find the cheapest and most reputable life insurance company, as opposed to just the cheapest.