SBA 7(a) Q&A
Short answer
An insured's age significantly increases business life insurance premium costs, as older individuals present a higher mortality risk to insurers.
Life insurance premiums are directly tied to the likelihood of the death benefit being paid. As individuals age, their risk of mortality increases, leading to higher premiums. This means policies for younger key persons are considerably more affordable than for older ones, making early planning advantageous.
A $1,000,000, 20-year term policy for a 35-year-old might cost $500 annually. The same policy for a 55-year-old could cost $2,500 annually, due to increased age and associated health risks.
Last reviewed 2026-06-15 · SBA sources checked through 2026-06-15. DealRoom analysis of business life-insurance and SBA collateral-insurance practice (SOP 50 10 8). Not insurance, legal, or tax advice. Grounded in the current SBA rulebook; verify against the official sources above before relying on it for a live deal. Not legal, tax, or financial advice, and not an approval decision.
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