Back in the "olden days" it was an unusual feat when someone lived to the "old age" of 70 or 80. These days, with all our modern advances in medicine, treatment, and our healthier lifestyles, more and more people are living longer and enjoying their good health well into their golden years. Studies show that over 49,000 people nationwide are over 100 years old, up dramatically from just a decade ago. According to U.S. census data, the number of people that live to 100 or beyond is expected to double each decade, and the fastest growing population in the U.S. these days is people that are 85 and older. And many aging experts say they are surprised every day by the number of people that are able to live without assistance well into their 90s.

What does this have to do with your life insurance rates? Well not only is prolonged life and good health good news for America's seniors from a lifestyle perspective, it is also good news from a life insurance perspective. Insurance companies will be adopting new actuarial tables that incorporate new mortality levels within the next 5 or 6 years, many sooner. Actuarial and mortality tables are utilized by life insurance companies to compute the probability of death by a certain age. In other words, they tell life insurance companies how long you are expected to live on average based on your age and sex.

For the first time in over 20 years, the American Academy of Actuaries has revised the table to reflect America's trend toward living longer. The new tables increase the maximum (theoretical) life expectancy to 120 years, not because actuaries actually think many people will reach the age of 120, but because this is the absolute highest age that it is theoretically possible for a person to reach these days.

According to the U.S. Centers for Disease Control, in 2000, the average life expectancy for American males was 74, up four years from 1980 (when the previous tables were written). For American females, the average life expectancy in 2000 was 79 years, up two years from the 1980 tables. In addition, the annual improvement in male mortality of the general U.S. population has improved by 2 percent in the age group 55-59, and has improved by 1.2 percent for females of the same age group.

Longer life spans mean that the mortality and expense charges you pay for coverage should be lower, which should in turn lower your premiums. Some insurance companies are claiming that the new tables will allow them to drop their rates by as much as 30 percent once they are adopted. Insurance companies benefit from the longer life spans of their consumers because they don't have to set aside as much to cover death benefit payoff, so these savings should be passed on to their consumers. Many are estimating that most insurance companies will be putting aside approximately 15 percent less than they currently do to cover death benefits.

While life insurance companies have until 2009 to implement the new actuarial tables, many will do it sooner rather than later. That means it is especially important to examine your policy frequently, and compare rates of various companies to see who has adopted the new tables and are therefore able to offer lower rates.

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