A Denver-area financial planner has a message to those who want to outlive their life insurance policies. Your physical health plays a fundamental role in your financial independence as it relates to term life insurance costs.

To illustrate her point, the author, who is an advisor at the Heartland Insitutute of Financial Education, considers two hypothetical life insurance customers. Bert and Ernie represent two 30 year old men purchasing $200,000 in 30 year term life insurance from a highly rated carrier. They are non-tobacco users and have no family history of cardiovascular disease or cancer.

Bert is 6’0” tall, is of average weight with a BMI of 22, has blood pressure of 120/80 and a cholesterol level of about 180, with a total cholesterol/HDL ratio of 4.

Ernie is also 6’0” tall but is clinically obese at a BMI of 32. His blood pressure is 140/90, his cholesterol is 220 and he has a total cholesterol/HDL ratio of 6.

Based on these parameters and assuming no other mitigating factors (such as a sky diving hobby), Bert would qualify for a rate of about $35 per month. Ernie does not get off so lightly with a quote is $66/month.**

Besides the possible cost disincentive for Ernie to obtain life insurance at all, which is unfortunate considering that he is more likely than Bert to need to have coverage for his family, the difference in cost can impact long term financial goals.

To see the difference, consider the future growth of $31/month (the difference between Ernie’s premiums and Bert’s) invested for 30 years at a hypothetical return of 8%. The total investment of $11,160 over time would compound to a little over $46,000.

To throw another variable into the loop, if Ernie uses tobacco, his insurance could run about $135 per month. That difference of $100 per month compared to Bert’s non-smoking, good health quote translates to $36,000 that could be invested in retirement savings. Compounded at 8%, this represents a total value in 30 years of $149,000.

Finally, in the worst case scenario where Ernie actually does die before the age of 60 from a heart attack, he has now negatively impacted his childrens’ ability to obtain affordable life insurance because they have to disclose a family history of cardiovascular disease.

The conclusion? In a society where we are seeing continuously increasing obesity rates, the pressure for insurance companies to hedge their risk will force rates to rise. Individuals can control some of this price increase by maintaining good health. Although weight may not be an individual factor for life insurance quotes and some conditions are hereditary, obesity is recognized as a contributing factor to cholesterol and blood pressure problems. A healthy diet and regular exercise will not only improve your quality of life now, it may also improve your family’s financial prospects for years and generations to come.

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