Definitions for "Level Premiums"
The incidence of mortality shows that the risk of death generally increases with age. To match this risk increase, premiums should, in theory, increase at the same rate. As this would at some point make the cost prohibitive and unattractive, it has become the norm to calculate a premium that will remain level throughout the term of the contract. This effectively means 'overpaying' at the start of the contract, which will counterbalance the 'underpayment' later.
Premiums in the policy are locked in and will never increase until age 65.
Is a premium that remains unchanged while the policy is in force. ()