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Why Do Most Life Insurance Companies Put My Age at One Year Older Than I Actually Am?

by Scott G on July 22, 2013 · 1 comment

Life Insurance-

Actual Age vs. Nearest Age Explained for 2016

I have been doing insurance for many years and have done thousands and thousands of life insurance applications.  Every day this topic comes up because quite frankly, it doesn’t really make sense.    Most life insurance companies calculate your premium by using what is called the “nearest age” rule.  What this means is the insurance company will round up your age to the nearest birthday by 6 months.  You can also look at is they go by your half-birthday day- you know as you used to say when you were a kid.  Compare this to “actual age” in which your premium is determined by your actual birthday.  I know it sounds a little confusing.   Let’s take a look at the chart below to better clarify the difference.

Actual Age

(Your rate is calculated by your actual birthday)

Top Companies who use actual age in 2016: Prudential, Mutual of Omaha


Birthday                   Age Will Change for Insurance Purposes

January                             January

February                             February

March                                  March

April                                     April      

May                                      May

June                                     June

July                                      July

August                                August

September                         September

October                               October

November                          November

December                          December


Nearest Age

(Your rate is calculated by your half birthday)

Top Companies who use nearest age in 2016: AIG-American General, Banner Life, Genworth, ING, Lincoln Life, Protective,  Transamerica


Birthday                    Age Will Change for Insurance Purposes

January                           July

February                         August

March                             September

April                                October

May                                 November

June                                December

July                                 January

August                            February

September                     March

October                          April

November                      May

December                      June


So for example, if today is July 21st 2013 and your birthday is September 10th 1973.  Your actual age is 39 years old but for insurance purposes you they are going to calculate your premium based on a 40 year old, because you are closer to that age than 39.  If you look at the chart above if you wanted the rate for a 39 year old and your birthday is September 10th you would have to purchase the insurance by March 10th in order to obtain the rate for a 39 year old.  I know this can be a confusing topic.  You can use the term quote engine on this page and it will calculate for you, your “nearest age” and present age.

What is backdating?

Life Insurance companies do allow you to backdate you application for up to 6 months.  This allows you to obtain the younger age which can save you a lot of money depending on the size of the policy.  Generally, the larger the premium and the older the client the more substantial savings you will typically see by backdating your application.  For example, if your half birthday was two months ago and your application was just approved today, you will automatically be charged as the older person-your nearest age.  However, the insurance company will allow you to “backdate” or “save age” for the younger age as long as you pay the premiums beginning on your half birthday until now.  If your premium is $115 month for a 60 year old, but the insurance company will allow you to the back payments for a 59 year old in which the premium is $100 month.  So you would have to pay $300 upfront-two back payments and this month’s payment, but for the rest of the policy your payment will be $100.  If you do the math, you would save thousands of dollars over the life of the policy by saving age or backdating.


Actual age vs. nearest age in life insurance can be confusing so many agents will not bring it up unless they’re asked.  However, since you are reading this blog and are an insider, you have the knowledge to obtain the best rate possible when purchasing life insurance to protect your family.  If you have any questions do not hesitate to ask or leave a comment below.


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    lifeinsurance1 July 25, 2013 at 1:59 am

    Thanks for the posting about the insurance. it is great motivational and nice message for us. i hop that we get more article in the future about the life insurance.

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