No, BMI is one of the many important criteria insurance companies use. They mainly include your age, occupational hazard, family history of medical conditions, and lifestyle factors such as tobacco use, alcohol consumption, etc.
What Is the Effect of BMI on Term Insurance Plan Premiums?
A term insurance plan offers a lump sum death benefit in case of the unfortunate event of your demise. However, while you must plan these events to safeguard your family from a loss of income, your health also determines the premiums you pay.
One such crucial factor is the impact of BMI on insurance premiums. BMI is an essential health indicator that insurers calculate along with other medical examinations while determining your term insurance premium amount. So, please keep reading to know more about its roles and effects.
What Is BMI?
Body Mass Index (BMI) is the weight of a person divided by their height. It indicates how much a person weighs with respect to their height. B
BMI = Weight of the person (in kg)/ Height of the person (in m)
Therefore, a higher BMI indicates that a person has more mass (body fat), which may lead to a series of health problems. BMI does not diagnose any underlying health disorder but is a crucial indicator of your health.
Consequently, you will find insurers calculating your BMI to determine the term insurance premium. Ideally, your BMI should range between 18.5 and 24.9, considering your age, height and weight.
What Is the Effect of BMI on Insurance Premiums?
To put it simply, the relationship between your BMI and the term insurance premium amount is inversely proportional. If you fall under the normal weight category, your insurer will offer you a more beneficial premium plan.
Conversely, if you fall under the overweight category, the insurer will charge a higher amount, even if you are on the lower end of the scale. Consequently, people with a higher BMI (obese) may have to pay the highest premiums.
As such, many insurance companies may increase the rate of premium at a fixed percentage with increased obesity. The logic behind this is simple. A higher BMI indicates that you are more prone to being affected by a chronic disease such as diabetes, high cholesterol, or critical heart-related illnesses, increasing the risk of shorter life expectancy. This is also applicable to underweight people who have an increased risk of critical illness.
How Are BMI Scores Categorised?
Based on the scores, BMI can be classified into four groups:
- Normal weight
The range of scores that determine the categories are as follows:
18.5 to 24.9
25.0 to 29.9
30.0 and above
Should You Buy a Term Insurance Plan if Your BMI Is High?
A term insurance plan is a beneficial financial tool that shields your loved ones against unfortunate circumstances. Therefore, it would be wise to purchase one, irrespective of your BMI.
Now coming to the case when you have a high BMI, getting yourself insured becomes imperative. This is because a higher BMI increases your chance of being affected by diabetes, high cholesterol, fatty liver, hypertension, sleep apnea, gall bladder stone, and other health conditions. These medical conditions automatically increase your risk of mortality more than ones with a normal BMI.
Therefore, you can calculate your BMI to check which category you fall under from the table above. If you have a high BMI, it would be wise to purchase a life insurance plan immediately. Then, refer to the categories and find the plan that suits you best.
Finally, the impact of BMI on insurance premiums not only helps you sort out your financial planning but also gives you an idea about how much you have to pay to purchase one. A higher BMI will contribute to a higher premium due to an increased mortality risk. Therefore, apart from getting yourself insured, a higher premium can also motivate you to take care of your health and lifestyle. It will save you big bucks and contribute to a longer and healthier life.
FAQs about the Effect of BMI on Term Insurance Plan Premiums
The average BMI score varies depending on your age and sex. However, the range lies broadly between 18.5 and 24.9.
Important Guides related to Life Insurance
- This is an informative article provided on 'as is' basis for awareness purpose only and not intended as a professional advice. The content of the article is derived from various open sources across the Internet. Digit Life Insurance is not promoting or recommending any aspect in the article or its correctness. Please verify the information and your requirement before taking any decisions.
- All the figures reflected in the article are for illustrative purposes. The premium for Coverage that one buys depends on various factors including customer requirements, eligibility, age, demography, insurance provider, product, coverage amount, term and other factors
- Tax Benefits, if applicable depend on the Tax Regime opted by the individual and the applicable tax provision. Please consult your Tax consultant before making any decision.