What factors influence the cost of insurance for Variable Life policies?

The cost of insurance for Variable Life policies is primarily influenced by the insured's age and health. These two factors are critical in determining the risk that the insurer takes on when providing coverage.

Age is significant because younger individuals typically present a lower risk of mortality compared to older individuals. As people age, their likelihood of encountering health issues increases, which in turn raises the insurance risk profile. Hence, younger policyholders often enjoy lower premiums than those in older age brackets.

Health plays a crucial role as well. Insurers assess the health status of the applicant, including any pre-existing conditions, lifestyle choices, and overall health history. Those in better health are usually eligible for preferred premium rates, while those with serious health concerns may face higher premiums due to the increased risk of claims.

By considering both age and health, insurers can more accurately gauge the probability of a claim arising during the life of the policy, which directly affects the premium charged for the coverage.