The Impact of Age on Term Insurance Premiums

When it comes to buying term life insurance, your age is more than just a number—it’s a key factor in how much you pay. That’s because the younger you are, the lower your chances of developing health issues, which makes you less risky for insurers. And less risk = lower premiums. 

Understanding the impact of age on term insurance premiums can help you make smarter decisions and lock in lower rates while you’re still young and healthy. 

What Are Insurance Premiums? 

In simple words, an insurance premium is the amount you pay—monthly, quarterly, or yearly—to keep your life insurance policy active. Think of it like a subscription fee to ensure your loved ones get financial protection if something happens to you.  

To put it clearly, the meaning of premium in life insurance is that you make regular payments to maintain the policy benefits over time. 

The premium depends on several things—like your age, health, coverage amount, and policy duration. The earlier you start, the cheaper it tends to be. That’s why it's important to understand how age affects term insurance premiums before you make a decision. 

How Age Affects Term Insurance Premiums 

There’s a direct connection between age and premium cost: as age increases, so do premiums. 

When you're younger (say in your 20s or early 30s), you're considered less likely to develop health conditions. Insurers reward this lower risk with more affordable premiums. But as you grow older, the chances of illness or medical issues rise, which increases the risk for the insurer—and the cost for you. 

That’s why buying early helps. Locking in a term plan when you're young and healthy means you get more coverage at a lower cost—and that premium stays fixed for the full term. 

Premium^@ Comparison by Age Groups 

Let’s break it down with simple age-wise comparisons to show how premiums increase: 

• Term Insurance in Your 20s: This is the suitable time to buy term insurance. You’re likely healthy, and the cost is minimal. 

👉 Example: A 25-year-old non-smoker can get a ₹1 crore cover for ₹11,903 a year with Bandhan Life's iTerm Prime 

• Term Insurance in Your 30s: Still affordable, but slightly more than in your 20s. You may now have a family or loans, making coverage even more important. 

👉 Example: A 35-year-old may pay around ₹18,576/year for the same cover with Bandhan Life's iTerm Prime 

• Term Insurance in Your 40s: Now, the premiums are significantly higher. Health risks increase, and insurers price in that risk. 

👉 Example: A 45-year-old would pay ₹31,396 for the same coverage with Bandhan Life's iTerm Prime 

The bottom line? The earlier, the better. 

How Do Insurance Premiums Increase As You Age? 

Premiums don’t just go up a little—they grow exponentially with age. This is because older individuals are more likely to develop health problems and face life-threatening conditions. 

What could cost you [1] ₹600/month in your 20s might cost up to 2.5X in your 40s—for the same benefit. That’s why insurers encourage early planning—it saves you a lot of money in the long run and keeps your premiums low throughout the policy. 

Why is Buying a Term Plan Early in Life a Smart Choice? 

When you buy a term plan early, you don’t just save money—you gain flexibility, peace of mind, and long-term security. 

• Flexibility of Term Plans: Buying early means you have more options—longer policy terms, higher sum assured, and rider benefits. You can align your plan with life goals like child education or loan repayment.
• Enjoy Lower Premiums When You're Younger: Your age is one of the biggest price factors. Starting in your 20s or early 30s can help you lock in low, fixed premiums for decades.
• Get Higher Sum Assured for Less: When you’re young, you can afford a higher cover. For instance, ₹1 crore might feel huge now—but 20 years later, it may just be what your family needs.
• Build Long-Term Financial Stability: With one less thing to worry about, you can plan investments, savings, and expenses more confidently.
• Develop Financial Discipline with Term Plans: Paying your premiums regularly builds a habit of financial discipline—and it feels good to know you’ve secured your family. 

What Affects Your Eligibility for a Term Plan? 

Eligibility depends on several factors, but age plays a key role. Here’s what insurers usually check: 

• Your Overall Health and Medical History: Chronic illnesses or a history of surgeries can impact your eligibility or increase your premium. 

• Your Financial Responsibilities: Insurers often consider your income, dependents, and liabilities while recommending cover amounts. 

• How Does Your Age Impact Term Insurance? Age affects your premium, term limit, and sometimes even eligibility. Many insurers cap new policy issuance around 65–70 years. 

• Life Stages and Changing Financial Needs: Your insurance needs will differ as you move from singlehood to marriage, parenting, and retirement planning. 

• Health Issues That Come With Age: As age increases, the chances of lifestyle diseases (like diabetes, hypertension) increase—which can spike your premiums or lead to declined applications. 

• Planning for Loans, Retirement, and Stability: Your term plan should match your life goals—whether it’s covering your home loan or providing for your child’s education. 

Meeting the eligibility criteria for term insurance at a younger age is generally easier, which is another reason to consider buying early.  

How to Choose the Right Term Plan for Your Age? 

Buying the right plan isn’t about just picking the cheapest option—it’s about choosing what suits your age, health, and goals. 

• Check Your Age and Health Status First: Get a medical check-up done and understand your risk profile. Buy when you’re healthiest to lock in the best premium. However, don't forget to mention your medical history while purchasing your term plan. 
• Know Age Limits and Renewal Rules: Know your entry and exit ages, and check if your plan allows extensions or conversions.
• Look at Your Current Financial Condition: Your income, loans, family expenses—all influence how much cover you’ll need.
• Think About Your Life Goals and Needs: Whether you’re planning a child’s future, buying a home, or nearing retirement, align the plan term accordingly.
• Compare Plan Features and Benefits: Don’t just look at price. Compare claim settlement ratios, rider options, flexibility, and digital service experience. 

Frequently Asked Questions 

1. Is it possible to get term insurance at 50+? 

Yes, but it may come with higher premiums, limited term lengths, and more medical tests. Some insurers offer special plans for senior citizens, but the cost will be steep. 

2. Does the premium change after buying a term plan? 

No. One of the best parts of term insurance is that your premium stays the same for the entire policy term—no matter how old you get. 

3. Can I get a refund if I cancel early? 

Not usually, unless you’ve chosen a Return of Premium plan. Standard term insurance has no maturity benefit. Once canceled, the policy ends and there’s no refund. However, if you cancel within 30 days of the receipt of the policy, which is the ‘Free Look’ period, you can get a refund.  

4. What if I delay buying term insurance? 

Delaying term insurance means: 

• Higher premium when you eventually buy
• Possible health issues leading to rejections
• Lower coverage approved based on age and condition
• It’s always better to buy early and stay covered.