insurance age

What is Your Insurance Age?

Life insurance companies use several factors when determining the premium for a policy. These include, but are not limited to, health status, health history, tobacco/nicotine use, gender and age. The last one seems fairly simple to determine. After all, your age is what the calendar says it is. Unfortunately, many life insurance companies see it a different way.

Life insurance companies generally use one of two methods for determining an applicant's insurance age for the purpose of issuing a life insurance policy.

1. Actual Age

The first method of age calculation is called Actual Age (sometimes referred to as Age Last Birthday). This method calculates your insurance age based on your last birthday. Let's look at a couple of examples:

• Example 1

Your Date of Birth	May 1, 1950
Today's Date	April 30, 2006
Your Insurance Age Today	55

• Example 2

Your Date of Birth	May 1, 1950
Today's Date	May 2, 2006
Your Insurance Age Today	56

The Actual Age calculation method is very straightforward as it is simply a measure of an applicant's calendar age on any given date.

2. Age Nearest Birthday

The second method of age calculation is called Age Nearest Birthday. This method calculates your insurance age based on your nearest birthday, which could be either your last birthday or your next. Here's how it works:

• Example 1

Your Date of Birth	May 1, 1950
Today's Date	May 2, 2006
Your Insurance Age Today	56

• Example 2

Your Date of Birth	May 1, 1950
Today's Date	November 2, 2006
Your Insurance Age Today	57

Example 2 shows us the significance of the Age Nearest Birthday calculation method. Your insurance age in Example 2 is 57 because on November 2nd, you are actually closer to your next birthday (your 57^th) than you are to your last birthday (your 56^th). So even though you have not yet turned 57 by the calendar, this method of calculation determines your insurance age to be 57. This will happen every year on the day you move to within six months of your next birthday.

Most life insurance companies use the Age Nearest Birthday method for age determination. QuickQuote's quoting system is designed to provide an accurate quote based on your date of birth, taking into account each individual company's quoting method.

However, by the time your policy is issued, your insurance age may be different than it was when you received your original quote. This will depend on whether you had a birthday or moved to within six months of your next birthday during the underwriting process. In either case, it may be possible to have your policy backdated to keep your Insurance Age down.