A premium is calculated using a range of factors that relate to the person’s life expectancy, and therefore their likelihood of claiming in the near future. Life insurance companies usually have a team of actuaries, who are responsible for the measurement and management of this risk and uncertainty.
When you apply for a life insurance policy, you might be asked questions like:
your biological sex
your age
your medical history
your family medical history
whether or not you’re a smoker.
Your answers to these questions will determine the premium you pay for the sum you want to be insured for.