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Many great products have come from Minnesota, including bundt cake, frozen pizza, Betty Crocker, SPAM, and the Milky Way bar. Despite Minnesotans’ taste for unhealthy foods, their population has the second highest life expectancy, and one of the lowest rates of obesity of any state. Minnesota also brought us the wearable pacemaker and where the first successful open heart surgery took place, so it’s not surprising that it has the lowest rate of heart disease of any state. All of these factors may play a role in the cost of life insurance in Minnesota.
Shopping for a life insurance policy in the state of Minnesota can be stressful. What can you do to keep from fretting about it? Shop around.
Last year, 4,918 people used QuoteWizard to compare life insurance quotes in Minnesota from multiple companies and find the lowest rates.
Below are the major factors that contribute to life insurance rates.
Age - Age is one of the largest factors affecting life insurance rates. The younger you are when you purchase a policy, the less likely it is that it will pay out. So the lower your rates.
Life expectancy at birth in Minnesota is 81.1 years, the second-highest of any state, after only Hawaii. The life expectancy at birth for the US overall is 78.9 years. What if you purchased a 30-year term life policy in Minnesota at age 54? You'd be more likely than not to pass away before 84 years of age, the end of the term.
On the other hand, what if you were 34 years old and purchased a 30-year term life policy? You'd be well under Minnesota’s life expectancy of 81.1 years old when the policy term ended. And you’d be a much lower risk to insure and would therefore pay much lower insurance premiums than the person in the former example.
Driving Record - Car accidents are incredibly common. They kill more than 30,000 people per year. If someone has a driving record littered with moving violations, they are at an increased risk of a premature demise. The result is higher rates.
Firearm Deaths - Places that have higher rates of accidental or premature death generally have higher rates. A significant part of these untimely deaths comes from firearm injuries, which account for about 33,000 deaths in the US every year. In Minnesota, the death rate from injury due to firearms is 7.6 per 100,000 deaths, the #8 lowest rate in the country. Nationwide, the average firearm death rate is 10.4 per 100,000.
Gender - Women live longer than men on average. So they pay less for insurance than a similar man would. In Minnesota, the percentage of the population that’s female is 50.3%. The percentage that’s male is 49.7%. In the US as a whole, women are 50.8% of the population, and men are 49.2% of the population.
Health History - Most of us have one or two minor health issues. But if you have a serious illness or a family history of such illnesses, this can affect your rates.
There are conditions likes heart disease or cancer which can make your insurance premiums. In some cases, a pre-existing condition can make you ineligible altogether. That's why it’s important to get life insurance before something serious happens.
Lifestyle & Hobbies - People who engage in adventure sports or who have potentially dangerous hobbies will pay more for insurance. This is especially relevant in Minnesota, where skiing and hunting are common recreational activities.
Marital Status - Married people live longer and are healthier than similar single people. So, if you’re married, you can get a modest discount on life insurance. In Minnesota in 2009, the rate of marriage for people over 15 was 30.7 per 1,000 people. The rate of divorce was 15.2 per 1,000 people. And the rate of widowhood was 9.1 per 1,000 people.
Occupation - People with hazardous jobs like logging and fishing will pay more for insurance than someone with a less dangerous, mundane office job. The most common job in Minnesota, proportionally, is a food scientist.
Tobacco Use - Tobacco users don’t live as long as non-tobacco users. So smokers pay much more for life insurance. Tobacco use is associated with a number of health complications, such as heart disease, stroke, and COPD. Any of which may cause higher rates and an earlier death.
As of 2013, the national average rate of smoking was 19%. To compare to the most recent data available, in 2014, approximately 18.0% of Minnesota adults smoked cigarettes – about 751,000 adults.
Travel - If you regularly travel to developing countries, particularly countries on the US State Department’s Warning List, you will pay more for insurance than a traveler who sticks to developed countries.
Value of Policy - One of the largest contributing factors to a life insurance policy’s premiums is the value of the policy. As with anything, you get what you pay for. The more protection that you purchase, the higher the premiums.
Weight - Obesity has surpassed smoking to become America’s largest public health cost and problem. Obese or seriously overweight people have a lower life expectancy. This means an increased probability of their policy being paid out. Obesity increases the likelihood of health problems like heart disease, stroke, diabetes, and some cancers. So overweight and obese people can expect to pay higher rates.
As of 2013, the adult obesity rate in Minnesota was 25.5%. This makes Minnesota the #41 most obese state. Overall, the average obesity rate in the US is 34.9%.
While each of these factors plays a big role in the cost of your policy, some aspects of life insurance are entirely individual. Insurance companies calculate your rates based on your own health, habits, and lifestyle. That’s why shopping around and comparing quotes is so important–to make sure you’re getting the best rate possible.
|Rank||Cause of Death||Total Deaths||Death Rate||State Rank||US Death Rate*|
|3||Lower Respiratory Disease||2,287||37.1||41st||42.1|
|6||Alzheimer's Disease||1,427||21.5||30th (tie)||23.5|
|*Death Rate calculated as: (deaths from that cause / total population) / 100,000|
|Rank||Company||Direct Premiums Written (in thousands)||Market Share|
|1||Prudential Financial Inc.||$866,771||8.0%|
|2||Securian Financial Group||$855,231||7.7%|
|3||Lincoln National Corp.||$622,264||5.6%|
|4||Manulife Financial Corp.||$606,023||5.5%|
|6||Jackson National Life Group||$494,535||4.5%|
|7||Principal Financial Group Inc.||$443,512||4.0%|
|8||Northwestern Mutual Life Insurance Co.||$411,346||3.7%|
|9||Ameriprise Financial Inc.||$397,439||3.6%|
|10||American International Group||$389,735||3.5%|
Source: A.M. Best (Ratings as of 9/1/2015)
Insurance in Minnesota is governed by the laws defined by Chapters 59-A to 79-A of the Minnesota Statutes, as outlined by the Minnesota Office of the Revisor of Statutes.
This legislation is used to regulate claims and provide certain protections to Minnesota consumers, for example:
Interest Rewards: In order to insure that consumers in Minnesota are paid their claims in a timely manner, state law mandates that interest accrue on any death claim. In the interest of the consumer, as soon as the insurance company receives the death certificate, interest starts building, for up to 60 days. After 60 days, the interest rate rises. So, because insurance companies want to avoid this extra payment, claims are usually paid within a month.
Guaranteed Benefits in the Case of Company Failure: If an insurance company can't make death claim payments, don't worry. The Minnesota Life and Health Insurance Guaranty Association will cover up to $300,000 of death benefits. It will also cover up to $100,000 in cash reimbursement. This is so that consumers have confidence that their beneficiaries will receive at least some of their death benefit, though the amount is the same regardless of how much the policy is worth.
These regulations don’t just protect consumers; they also protect insurance companies from fraud. For example, Minnesota insurers may challenge any information in your insurance application for up to two years from the policy’s effective date. If they find any evidence of fraud, they can terminate your policy immediately.
This organization assists the customers of any insurance company that is found to be insolvent. If you have concerns about the financial well-being of your carrier, you should contact the MLHIGA. Their contact info is below:
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