We've all heard that our health is affected by lifestyle factors like:

• Smoking
• Physical activity
• Diet
• Body weight
• Blood pressure

But did you ever think about how these factors could affect your insurance premiums? 

How Insurers Calculates Your Health

While there's little you can do about a genetic tendency towards certain diseases, a healthy lifestyle can substantially reduce your risk for problems such as hypertension, heart disease, diabetes and some forms of cancer.

Insurance companies will use these factors to determine the insurance premium for each individual. For example, the Body Mass Index (BMI) is used to establish whether you are currently living within a healthy range. This number indicates how likely you are to suffer from issues like high cholesterol or blood pressure fluctuations which could lead to bigger problems like heart attacks.

Determining Your Premium

In the eyes of your insurer, certain health conditions could predispose you to claiming more than an otherwise healthy individual would. As a result, they'll charge you a higher premium. This is referred to as "premium loading."

Premium loading follows the same principle when it comes to home insurance. Let's say you live in an area prone to bushfires. Your home insurance premium will be higher than that of your friends who live in a region not prone to bushfires. The same applies to car insurance – a lower premium follows a record of safe driving habits.

Did you know, however, that some insurers are now rewarding members with premium discounts if their BMI falls within a specified range of health? This range is usually somewhere from 19-28 and the discounts apply for the life of the policy.

But an exclusion can be a good thing in that you'll be covered for just about everything else at the standard rate.

Financial Help With Your Insurance

Premium loadings and exclusions should be reviewed from time to time in light of changes to your health. That's why it's important to talk with a financial planner on a regular basis to get you the most health coverage at the lowest possible costs.

Lots of insurers are offering health and wellbeing rewards programs which give you points for making healthy lifestyle choices. You'll be rewarded with premium discounts and much more.

How do you measure up? Click here to use an online tool to find out.

What Next?

At Calder Wealth Management, our specialist team of financial advisers will help you to avoid a financial burden. Contact us or call 08 8373 3333 to arrange a free, no obligation appointment.

Written by, Marisa Maiolo, Life Insurance Specialist at Calder Wealth Management.