Your average premium will be an average across different insurance companies.
Life insurance premiums are calculated based on a variety of factors like health, age, sex and lifestyle. Average premium rates for life insurance will depend entirely on these factors, so your average premium will be an average across different insurance companies based on what each individual insurance company will offer you as coverage.
Age
Age plays a large role in determining what your average life insurance premium will be. Average premiums for life insurance are going to higher as you grow older. Conversely, the younger you are, the lower your chance of death and so the cost for insuring your life is lower.
Health
Health is another factor that affects how much the premiums will be for your insurance policy. A healthy individual is at lower risk for dying prematurely. Insurance companies often collect blood and urine samples to test for various health markers like cholesterol, blood pressure and long-term drug use. The insurance company can also check for other, more serious, health conditions like diabetes or other chronic diseases or conditions that could cause premature death.
Sex
Insurance companies use mortality tables to determine average life expectancies. This is not an exact science, but insurance companies have consistently found that women live longer than men. This, in turn, translates into lower average premiums for women when compared to premiums for men.
Occupation or Avocation
Occupations play an important role in determining life insurance premiums. If you work in a dangerous profession, like mining or you are a commercial pilot, the insurance company may deem you to be a higher than normal risk and it can negatively affect your premium rates. This also applies to hobbies you enjoy, like sky-diving, base jumping or automobile racing.
Habits
Habits like excessive drinking and regular smoking can negatively affect your premiums. While some insurance companies offer waivers for a once or twice a year cigar, regular smoking will typically earn you a smoker's rating, which comes with increased premium costs. Poor dieting habits, being overweight and a generally poor lifestyle also can contribute to increased premium costs.
Group Term Life
Group term life insurance is normally rated differently than individual life insurance. These policies are owned by the employer and offered to employees as a company benefit. Premiums for these kinds of policies will be determined by the size of the group and the general risk associated with insuring the group (i.e. if the insurance company is insuring pilots, the group rate would be different from insuring restaurant employees, which would be different from insuring factory employees). Employees all pay the same insurance premium for group insurance.
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