Term Life Insurance: Why Your Family History Matters

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Tim is a licensed life insurance agent with 23 years of experience helping people protect their families and businesses with term life insurance. He writes and creates stuff for QuickQuote and other insurance and financial websites. You can find him on Twitter.

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UPDATED: Aug 6, 2020

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If you’re like most people, there’s nothing more important to you than your family. Your family is probably the reason you are looking for term life insurance right now. But did you know your family can have a big impact on the premium you will pay for your new policy? It’s not your spouse or your children we’re talking about, but rather your mother, father, and siblings.

Your genetic predisposition and the lifestyle choices of your parents play an important role in determining your eligibility for term life insurance and the premiums you will pay. If you are one of the many people, who has been asked to pay higher premiums on term life insurance due to your family history, read on for some rationale behind the family history madness!

You may have heard common diseases like cancer, heart disease, and diabetes referred to as lifestyle diseases. Lifestyle diseases are considered to be caused, in part, by poor dietary choices, lack of exercise, tobacco/drug use, stress, lack of sleep, alcohol use, and many other poor personal behavior choices. People who get these so-called lifestyle diseases may also have a genetic predisposition for them, but not always.

According to the World Health Organization (WHO), genetic abnormalities can play a role in causing cardiovascular disease. Lifestyle is considered a risk factor, but not necessarily the sole contributor. An article by the American Heart Association (AHA) reports that elevated homocysteine levels increase the risk of heart disease, stroke, and blood clots. People with a genetic variant of methylenetetrahydrofolate reductase (MTHFR) are at a higher risk of elevated homocysteine levels.

Genetic predisposition for some cancers has been discovered in the BRCA1 and BRCA2 genes. The WHO reports that family members affected by BRCA1 have a 70% lifetime risk of inheriting breast or ovarian cancer. A study published by the New England Journal of Medicine reports the discovery of genetic variants that are linked to a risk of prostate cancer. An issue from Current Science Online by K.M. Mohandas (http://bit.ly/ndX1GN) gives a table that shows many inherited syndromes that show a genetic predisposition to cancer.

In addition to genetic predisposition, parents can “pass down” bad lifestyle habits to their children. A child raised by someone who smokes, drinks, eats poorly and doesn’t exercise is more likely to view those habits as normal and adopt a similar lifestyle. Since there is currently no way for a life insurance company to know if you have a genetic predisposition to the same diseases that plagued your parents and siblings, they must assume there is some risk involved.

How Life Insurance Companies Use Family History

Life insurance companies use mortality tables to determine how much of a risk any certain factor has on an individual’s life expectancy. Mortality tables are created by actuaries who study the prevalence of any particular risk factor in the recent past to determine future risk of any particular age group and gender. All else being equal, the risk associated with family history of cancer or cardiovascular disease will usually cause a policy to be issued at a lower rating class and a higher premium.

The good news is the guidelines vary from company to company, so there are opportunities to find the best company for a particular type of family history. There are even some life insurance companies that do not penalize for family history at all. As always, find a good broker or agent and let them ‘shop’ with several companies to find the best one for you.

To find out more about genetic predisposition and disease risk, visit Genes and Human Disease.

Being penalized for family history seems unfair to most people applying for term life insurance. Hopefully, this post helps shed some light on why it is so. Do you have any family history that’s caused your life insurance premiums to be higher?

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