How to calculate premiums?
Insurers want as little risk as possible before making a deal with you. The actuaries calculate the risk with the help of a large database of statistics to make sure they get the best offer they can. What does this actually mean?
In case of a life insurance they want to make sure that you won’t die prematurely. They would examine your lifestyle, medical history and current health. After receiving all this information, you will be classified according to the statistical tables which will show the risk and therefore the premium payable.