Alcohol Consumption: How it Affects Life Insurance Rates

Whether it is going to happy hour with friends, sharing a bottle of wine at dinner, or downing a couple beers while watching a favorite team, alcohol plays a significant role in the lives of many Americans. In fact, it's reported that 64% of Americans drink alcohol regularly. Apart from alcohol abuse, drinking is a pleasure that seems relatively innocuous to most people, however; life insurance companies see it differently. Like smoking tobacco, alcohol consumption can easily affect how much you pay for life insurance.

Like your blood pressure, cholesterol level, and your weight, alcohol consumption is an important life insurance underwriting factor. Although the cost impacts on your premiums are harder to determine than other factors, carriers have specific definitions to determine the extent of potential health risk.

Obviously, the degree of consumption is relatively subjective, given that one person's "social drink" is another's six-pack afternoon. Therefore, insurance companies generally look at three things to determine your life insurance rates, as it relates to alcohol consumption: (1) Simple questions regarding your consumption of alcohol; (2) Your driving record; and (3) Results from your application medical examination.

Alcohol and Life Insurance Quotes

As you may notice during your life insurance quoting application, you may be asked several questions about any existing medical conditions including liver disease and high blood pressure. Further you may also be asked about any history of alcoholism and/or drug abuse. Make sure that you answer these questions accurately, so that in the event you pass away, the policy isn't cancelled under the realization that you provided false information. Although you are not shopping for car insurance, life insurance carriers are known to check your driving record for any alcohol related offenses.

DUIs and Life Insurance Rates

It's believed that there is a significant correlation between DUIs and alcohol abuse, therefore, insurance companies adjust premiums accordingly. Be aware that DUIs remain on driving records for up to 7 years in some states. Finally, most insurance companies require a medical examination to put the policy in to force. Other than verifying your actual weight, height, and blood pressure, these exams generally involve a blood test that looks for elevated levels of enzymes in your liver.

How You Can Find Lower Life Insurance Rates

Often times, recovering alcoholics and those who drink heavily underestimate the ability to find affordable life insurance with adequate coverage levels. However, even smokers can attest, nearly everyone can find affordable term life insurance rates when paired up with the right company - even those who consume alcohol on a regular basis. Recognizing that 64% of Americans drink, there is a significant market for life insurance companies to offer competitive term life insurance products.

Five Ways to Save on Term Life Insurance

1. Buy Life Insurance when you're young

Secure as much protection at a young age while your health and prices are still good.

2. Select the right length of life insurance coverage

Everyone has different needs, and not one size fits all when it comes to term life insurance. While it may make sense for people in their 30s and 40s to secure a 20-year term length, a 10-year term might be more appropriate for someone nearing retirement.

3. Check for life insurance policy price breaks

Companies often offer "price breaks" at certain coverage amounts, e.g., $250,000 vs. $225,000. The truth is that many people can actually pay less money for more coverage. Check how little your prices increase when you increase coverage to $250,000, $500,000, or $1,000,000.

4. Buy the right amount of life insurance coverage

Many agents may try to sell you more coverage than you need. Independent financial planners recommend purchasing an amount of coverage equal to 6-10 times your annual gross income.

5. Review your life insurance policy often

Conduct a review of your life insurance policy at least every three years, if not more often. Rates may be lower, and your circumstances may have changed, necessitating more or less protection.