Insurance Premium Calculator

It follows the structure Premium = (Coverage / 1000) x Mortality Rate x Risk Factors x (1 + Profit Margin) — a simplified version of the actuarial logic real term life insurers use, where Mortality Rate rises with age, Risk Factors combine a health-status multiplier and a smoking multiplier, and Profit Margin represents the insurer's markup over the pure risk-based cost.

Cost per $1000 Coverage is calculated by dividing the final premium back by coverage amount and re-normalizing to a $1,000 basis, and since the premium itself was built by multiplying a per-$1000 rate straight through by Coverage Amount, that scaling factor cancels out exactly. A $100,000 policy and a $1,000,000 policy carry the same per-$1000 rate in this model — only the total dollar premium changes with coverage size.

No — Term Length has no effect on Annual Premium (Final), the yearly rate you'd pay. It only comes into play for Total Premium (Term), which multiplies that unchanged annual figure by the number of years in the term to show the cumulative cost over the full policy duration.

This calculator uses a simplified exponential curve where mortality risk increases with age past a baseline, which captures the real, well-documented pattern that mortality risk accelerates later in life. Real insurers instead price against published actuarial mortality tables built from large population studies, combined with individual medical underwriting, family history, and insurer-specific risk pooling — all considerably more detailed than this illustrative model.

This model applies a 2.5x multiplier for smokers versus a range of 0.7x to 1.5x across the four general health-status tiers, reflecting the real and heavily documented finding that smoking substantially elevates mortality risk beyond most other single health factors. Real insurers likewise treat smoking status as one of the single largest pricing factors in term life underwriting, often separate from the broader health classification.