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High risk life insurance: What is it?

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Last updated: 18 May 2021

Could you be classified as high risk by your insurer? These policies usually cost more than conventional life insurance policies, so it is worth investigating whether you fall into this category.

What is high risk life insurance?

To understand what high risk life insurance is, it is important to understand the ways that the insurance companies work.  

In simple terms, their main aim is to reduce the amount that they pay out in relation to the amount they have coming in through premiums.  

Because of this, the more at risk you are of death during the term of the life insurance package, the less they will want to cover you, meaning that you will have to pay more in premiums for the privilege.

When calculating your premiums and whether you are ‘high risk’, they will ask you a series of in-depth personal questions.

What factors make me high risk?

In the questionnaire that companies will provide when you sign up to a policy, they will try to find out as much about your life and health as possible, including:

  • Age: It may seem obvious, or even perhaps a bit crass, but the older you are, the closer you are to death.  Companies therefore charge more in premiums to older customers.  However, there are some companies that specialise in life insurance policies for over 50s, so be sure to use our site to shop around and check life insurance quotes from different companies.
  • Lifestyle: Companies will also ask you questions about the ways that you live your day-to-day life, as these can impact your health. Smoking or consuming a lot of alcohol increases your risk, so be prepared to pay for higher premiums on your life insurance. Your weight will also affect your premiums, so if you are overweight or obese, or have high blood pressure, you may be considered high risk.
  • Employment: What you do for work will also be considered when factoring how high your risk is, as some jobs are considered to be more dangerous to your life than others. For example, if you are a firefighter, you will be considered to be more at risk of death than a librarian.
  • Hobbies: Companies will want to know what you do for fun as well before determining your risk.  If you just play guitar then don’t worry, this will not affect your premium, but if you like to climb big mountains and cliff faces in your spare time, then you will likely have to pay more for your insurance.
  • Your home address: Now this might sound like a strange one, but life insurance companies have been known to factor in your postcode into their premium calculations.  Some postcodes have been deemed to be at greater risk than others because of higher rates of crime, or known worse lifestyles.
  • Health: Your health can be an important factor that insurers will take into account when you compare policies. If you have a pre-existing condition you may be classed as high risk and might have to take out a specialist policy.

Providing accurate information

Although it may be tempting to either leave out certain bits of information or mislead the insurance companies in order to try and get cheaper life insurance quotes, you should definitely not do this.

Remember, life insurance companies usually want to try and pay out as little as possible, so if someone is found to have provided false information, such as saying that they didn’t smoke when in fact they smoked heavily, it is possible that they will not pay out.  

Not only would this mean that all of the money paid in premiums was wasted, but also could be financially devastating for your loved ones.

Is it possible to get a cheap high risk life insurance plan?

Considering the ways in which life insurance companies measure risk, there are definitely steps you can take to make sure that your life insurance premiums are cheaper.  

Quitting smoking, cutting down on alcohol, and exercising more can all lead to you getting cheaper life insurance deals.

It is worth bearing in mind though, when you compare life insurance quotes, that the cheapest deal may not be the best one for you.  

Some deals may have lower premiums, but have a lower rate of paying out, so it is important to make sure that you do your research on the rates of successful payouts as well. 

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Fergus Cole

Author: Fergus Cole

Fergus is a journalist specialising in the personal finance, energy and broadband sectors. He also has a passion for travel and adventure so tries to make the most of this in any spare time he gets.