Expectation Of Life

What Does Expectation Of Life Mean?

The expectation of life refers to the number of years a person is expected to live, based on calculations from mortality tables.

Calculations of the expectation of life are often used in life insurance to assess the risk associated with issuing a policy to an applicant.

Insuranceopedia Explains Expectation Of Life

The fewer years a person is expected to have remaining, the higher the perceived risk of insuring them. Life insurance companies must pay substantial death benefits when policyholders pass away, so they must balance this potential expense against the premiums they will likely collect.

Several factors can reduce a person’s life expectancy, including advanced age, a family history of heart disease, and unhealthy habits such as smoking.