Gender and life insurance

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Gender can play a significant role in how much you pay for life insurance. Men may pay thousands of dollars more than a woman for a term life policy.

Why is there a difference? Men are considered a higher risk.

Men die younger and are more prone to have riskier jobs and lifestyles. Men tend to binge drink more, perform riskier work around the house, such as climb ladders, use heavier tools, and work on cars at home. They’re also more likely to carry stress with them because unlike their female counterparts. They don’t tend to have a large circle of friends with whom to commiserate.

Women live on average about five years longer than men. That fact plays into your rates, especially if you buy a longer policy that stretches into your senior years.

A man’s average lifespan is almost 80. A woman’s average life span is about 85. The difference between those five years for a life insurer is huge. Life insurance companies prefer not to pay out death benefits on a term life policy. They would rather you outlive your policy.

With that in mind, a life insurer would charge an older man more than a woman. For instance, a 50-year-old man buying a 30-year-old plan may need to pay $500 more each year than a woman the same age.

How life insurance companies set rates

Your habits, your health, your gender, and national mortality tables are the main factors life insurance companies’ underwriting departments use to set rates.

Do you skydive? Are you a pilot? Do you smoke? Insurers look to see if your behaviors and habits are risky and charge accordingly.

If your behaviors are tied to statistically shorter lifespans, chances are higher that a benefit will have to be paid before the term ends.

If you’re overweight, have diabetes or heart conditions, or have some other high-risk health situation, this too will increase your premiums. Your health history, as well as your current state, will be assessed during your medical exam, which most insurance companies require.

And yes, your gender, just as with auto insurers, is a significant indicator of which direction your rates will head.

What role does gender play in term life insurance rates?

Term life insurance offers coverage for a specific number of years, such as 10 or 20 years.

If you outlive your policy, your insurer won’t have to pay a death benefit.

This is where the man’s lifespan comes into play. Let’s say a male purchases a 20-year policy at age 42, then develops cardiovascular disease in his early 50s and dies of a heart attack at 60.

With two years left on his term policy, the insurer would pay the death benefit to survivors. To compensate for such a scenario, companies charge males more than females, who typically don’t develop such diseases until their 70s and 80s — presumably long after their term ended.

Let’s take a look at how the rates differ by gender.

Average Annual Premiums for Term Life death benefit of $250,000

Health profile and term length	Age 30	Age 40	Age 50	Age 60
Female non-smoker 10-year term	$232	$318	$598	$1,225
Male non-smoker 10-year term	$274	$377	$769	$1,782
Female non-smoker 20-year term	$303	$466	$948	$2,316
Male non-smoker 20-year term	$357	$578	$1,202	$3,179
Female non-smoker 30-year term	$426	$693	$1,573	$7,300*
Male non-smoker 30-year term	$523	$866	$2,065	$7,300*

*Limited quotes available. Data source: Compulife Quotation System as of Jan. 2019.

What role does gender play in permanent life insurance rates?

Permanent life insurance, such as whole life, is for life. Because the policy is guaranteed, the insurance companies have less incentive to set rates based on your gender. Instead, insurers determine rates on the amount of coverage, age, and state of your health.

As long as you pay your premiums, your survivors will receive a death penalty when you die. These plans also have a cash value component. This allows you to tap into your policy, though any money taken out is subtracted from a death benefit.

How to save on life insurance

One obvious way to save money on life insurance is to choose term life. As we mentioned above, because the policy has a set term limit, costs are less expensive compared to permanent life insurance.

A good first place to start when figuring out what policy to get is our Life Insurance Advisor to see what’s best for your situation. You can also check out our Life Insurance Calculator to find how much you need and look at our Best Life Insurance Companies.

As with anything, shopping around for multiple quotes is never a bad idea. Make sure you’re quoting apples to apples and see what different companies are charging. Remember, the higher the risk, the higher the premium some behaviors that contribute to a less-than-healthy lifestyle will cost you.

Smokers and those who are overweight are tops on this high-risk list. In fact, rates for smokers are nearly double those of non-smokers. Oh, and don’t think you can hide your smoking from the insurer. The good news is that most companies will reward you for getting healthier. Quit smoking and in five years, you will likely be considered a non-smoker.

The medical exam is never fun, but policies that require one typically will cost less the policies that require no exam. Without one, the insurer is flying blind and is running with averages of lifespan. Without knowing specific history or current medical issues, their rates will be higher. Be honest, get examined and get the benefit of the better rate.

A few other ways to save when you’re buying life insurance include: buying when you’re young, choosing term life instead of permanent life insurance, and paying your premium annually instead of on a payment plan, which can add fees to each payment.

And men, don’t fret. Yes, statistics say you will pay more than women for life insurance, but that’s not to say you won’t be able to take advantage of obvious ways to save. If you’re a healthy and non-risk-taker, your premiums won’t be exorbitant. The key is to purchase it as early in your life as possible and to follow a healthy lifestyle.