Published January 30, 2018|5 min read
With the start of a new year, many of us have embarked on self-betterment resolutions. The vast majority of these are health-related: Eat healthier, get more exercise, sleep better, stay fit, lose weight.
But what about financial health? Many of us are resolving to get our financial house in order, too. It turns out the two are closely related.
Policygenius, a leading online insurance marketplace, was curious about how people applying for life insurance compare health-wise to the nation at large — and where in particular certain conditions, like tobacco use, heart disease or diabetes, are above or below the national average. Additionally, we looked at the financial costs associated with these conditions as compared to a healthy lifestyle.
We’ll explore these topics in depth. Here’s a summary of our findings.
Surprisingly, life insurance applicants overall have lower rates of high cholesterol, tobacco use, high blood pressure, diabetes, sleep apnea, asthma, and depression than the average American — but figures vary widely by state.
Life insurance applicants in North Dakota (34.8%) have much higher rates of tobacco use than the national average (20.5%), while those in Utah (8.2%) have much lower rates.
Life insurance applicants in South Carolina (17.3%) have much higher rates of high cholesterol than the national average (11.8%), while applicants in Montana (2.1%) have much lower rates.
Smoking has the highest impact on life insurance premiums (342% increase), while high cholesterol has the lowest impact (31% more).
Now, let’s take a deeper look at the data.
One might expect unhealthy people to apply for life insurance more than healthy people, since they’re at higher risk of no longer being there to support their families. Counterintuitively, the opposite is true: People applying for life insurance pursue healthier lifestyles than average.
We looked at two years worth of anonymized data (11/2015 to 11/2017) from life insurance applicants with various providers. To ensure the highest accuracy, we limited our data set to phone-verified applicants. For the national data, we used figures from the Centers for Disease Control and Prevention, American Heart Association, American Diabetes Association, National Institute of Mental Health and others. At 38 years old, the median age of our applicants matches the national average provided in 2015 census data.
Interestingly, the average life insurance applicant in our data set had lower percentages of ailments across the board.
Life insurance applicants, on average, have lower rates of high cholesterol (25% less than national average), tobacco use (22%), high blood pressure (14.4%), diabetes (7.1%), sleep apnea (4.2%), asthma (3.6%) and depression (0.7%).
Let’s take a look at how health varies geographically.
Though life insurance applicants are healthier than the average American, it largely depends on where they’re from.
To get a bigger-picture sense of this, we broke down each health condition by state. Averaging out the percentages for all ailments across states, here are the top 10 healthiest (and least healthy) states:
Overall, folks in Montana and Wyoming are tied for healthiest life insurance applicants. The western U.S. seems particularly healthy, claiming four of the five top states. On the flip side, the southern U.S. seems particularly unhealthy: though North Dakota claims the top spot (12.4% of insurance applicants have an ailment there), the South takes three of the top five positions.
Next, let’s get into more granular detail by breaking down each ailment on a state level. Starting with high cholesterol, we can see there’s a wide variance.
Life insurance applicants in South Carolina (17.3%), West Virginia (16.7%) and Idaho (16.4%) have much higher rates of high cholesterol than the national average (11.8%). Meanwhile, applicants in Montana (2.1%), New Mexico (3.1%) and D.C. (5.6%) have much lower rates.
Life insurance applicants in North Dakota (34.8%), Vermont (28.6%) and Kansas (27.2%) have much higher rates of tobacco use than the national average (20.5%), while applicants in Utah (8.2%), Idaho (8.2%) and Hawaii (8.9%) have much lower rates.
Life insurance applicants in Alabama (23.2%), Louisiana (22.4%) and Mississippi (22.2%) have much higher rates of high blood pressure than the national average (14.6%), while applicants in Montana (2.1%), D.C. (6.8%) and Rhode Island (7.1%) have much lower rates.
Life insurance applicants in Kansas (6.1%), Louisiana (4.8%) and North Dakota (4.3%) have much higher rates of diabetes than the national average (2.3%), while applicants in Missouri (0.4%), D.C. (0.6%) and Wisconsin (0.7%) have much lower rates.
Life insurance applicants in Iowa (5.5%), Missouri (5.2%) and Indiana (4.8%) have much higher rates of sleep apnea than the national average (2.4%), while those in Oklahoma (0.8%), Michigan (1.1%) and D.C. (1.1%) have much lower rates.
Life insurance applicants in Rhode Island (11.9%), D.C. (7.9%) and Hawaii (7.1%) have much higher rates of asthma than the national average (4.4%), while applicants in Maine (1.4%), New Mexico (1.5%) and Idaho (1.6%) have much lower rates.
Life insurance applicants in North Dakota (17.4%), Iowa (12.7%) and Delaware (10.3%) have much higher rates of depression than the national average (6.3%), while applicants in Louisiana (2%), South Dakota (2.4%) and Alaska (3.1%) have much lower rates.
Keep in mind, these figures don’t speak to the overall averages of these conditions in each state, but rather the averages among life insurance applicants.
Though life insurance applicants seem to be healthier than the average American, those who do have health ailments and/or certain habits end up paying significantly more money for their policies.
To find out exactly how much more, we used a profile of the average life insurance applicant — a 38 year-old male applying for a $500,000, 20-year term policy, which will cost $25.37 per month.
Far and away, smoking causes the highest increase in a policy’s monthly cost. Smokers pay $112.23 — or an astounding 342% more than average. Over 20 years, the smoker will pay about $21,000 more than the non-smoker for the same coverage.
This is likely because smoking increases death from all causes in both men and women, and is the leading preventable cause of death in the U.S.
Diabetes also ranks highly, at 210% more, as do (somewhat surprisingly) sleep apnea (190%) and asthma (152%). High cholesterol and high blood pressure, equally surprisingly, seem to have less of an effect on insurance costs.
To conclude, our report shows people applying for life insurance, on the whole, are healthier than the average American. Aside from certain regional outliers, this proves to be true across the board. Additionally, a healthy lifestyle comes with significant savings on financial protection.
Those making New Year’s resolutions to improve their physical and financial health are in luck — the two go hand in hand. If you’re a smoker who plans to enroll in a life insurance plan, it’s pretty clear what your 2018 resolution should be. That is, unless you’d like to pay 3.5x more for your coverage.
Have a health condition? Here's everything you need to know about finding an affordable life insurance policy.
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