When you compare life insurance rates and quotes from some of the top life insurance companies, it is important that you compare against the average cost of life insurance for different types of policies and terms – it’s really the only way to know you are getting the lowest premiums.
The top factors influencing your life insurance prices are your age and health, specifically whether or not you smoke, engage in high risk activities, or currently have any medical issues. For instance, individuals who smoke can expect to pay 3 to 4 times more than healthier non-smokers.
Below, we will finally address your biggest question – “how much does life insurance cost?” – with a series of charts and tables breaking down average life insurance rates by age, term, and health class ratings.
Average Cost of Term Life Insurance
The data provided analyzes a 20 year term life insurance policy with a face value (or death benefit payout) of $250,000. We’ve broken down the prices into average monthly and annual costs for individuals between 25 and 65 years old. What should immediately stand out to you is that non-smokers get the cheapest life insurance rates, and the disparity grows wider as you age.
You may also notice that premiums widen significantly when looking for life insurance over 50 and 60. This is why financial experts recommend you buy a term life policy when you are young and healthy.
Average Cost of Life Insurance By Term
Here you will find a breakdown of the average cost of term life insurance by the number of years on the policy: 10, 15, 20, and 30. As expected, the longer the policy term, the more expensive the premiums. The cost of a 10 year term life policy averages $569 per year, while a 30 year term life insurance policy costs $1,528.
Term Life Insurance Policy Costs
Without a doubt, term life insurance rates are the cheapest, especially compared to whole life insurance rates, which are usually 5 to 10 times more expensive. The 10, 20, and 30 year term life insurance charts below demonstrate the average costs of coverage for each policy.
Because companies insure less risk with shorter terms, you will notice that 10 year policies have cheaper monthly and annual premiums compared to 20 and 30 year policies.
30 Year Term Life Insurance Rates
The data below represents the average annual life insurance rates for a 30 year term policy depending on the amount of coverage you want to buy and your current level of health.
The “Rate Class” you are assigned is determined by your current health and family medical history, and has a huge effect on your life insurance costs. Some of the advantages of 30 year term policies are that they offer the most flexibility, maximum coverage, and premiums remain constant even if your health deteriorates over time. We recommend you lock in rates at a young, healthy age when prices are most affordable.
20 Year Term Life Insurance Rates
A 20 year term life insurance policy is the most popular option in the United States.
While 20 year term policies offer shorter lengths of coverage, these policies are usually recommended for young families with tighter budgets who still need significant amounts of life insurance to cover large debts and expenses, such as mortgage payments, auto and school loans, living costs, etc. A 20-year term should provide families time to secure their financial future, reduce debt, and build a substantial nest egg for retirement. Overall, this will offer the best value by balancing the cost of life insurance and coverage.
10 Year Term Life Insurance Rates
Looking for term life insurance with the cheapest rates? Naturally, 10 year term life insurance policies are the most affordable compared to their 20 and 30 year counterparts. If you won’t need insurance after 10 years or can’t afford the higher cost of longer coverage, 10 year term life might be the best policy for your needs.
To learn more about the cost of life insurance, enter your zip code and compare quotes from the best life insurance companies in the United States.