Are You Overpaying for Your Life Insurance?
A Guide to Life Insurance Cost
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Life insurance can be a great financial safety net, but it’s also something you may be making payments on for many years. It’s therefore important to find the most beneficial policy for the most affordable cost. After all, it negates the whole point of getting insurance in the first place if it lapses because you can’t pay for life insurance cost.
There are numerous life insurance companies, term lengths, and coverage amounts to select from. Price will, of course, play a role in your decision and may influence the kind of policy you pick. It’s best to work with an independent agent to get life insurance at the most competitive prices.
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Factors That Affect Life Insurance Cost
There are several primary factors that affect life insurance costs. Let’s review them below.
Policy
There are two basic types of life insurance:
- Term life insurance: Term life insurance is the more affordable of the two options. It provides coverage for a predetermined period without accruing cash value. Just to give you a rough idea, if you’re a woman in your 40s who doesn’t smoke, you may on average expect to pay $83 per month for a $1 million policy on a 20-year term life insurance policy. The same policy will cost approximately $20 extra each month if you’re a man.
- Whole or universal life insurance: Whole life insurance, on the other hand, lasts a lifetime, and includes a cash value component that enables you to borrow against your policy or withdraw money in the future. Permanent policies likely cost more than term life insurance because of the cash value and the potential for a longer coverage duration
Amount of coverage
The amount of coverage refers to the face value of your policy. An insurance policy for $1 million will cost more than one for $250,000 or $500,000.
Term Length
If you choose term life, the longer the term (30 years as opposed to 20, for instance), the higher the premium will be.
Your health, demographics and Lifestyle
- Age: The cost of premiums increases by an average of 4.5% to 9% each year you delay buying a life insurance policy.
- Gender: Due to their longer life expectancies, women typically pay less for life insurance than men.
- Health: Your rates are significantly impacted by your health. In general, your rates will be lower the healthier you are.
- Hobbies and lifestyle: If you smoke or participate in risky hobbies like skydiving or rock climbing, your insurance rates will increase.
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The Average Cost of Life insurance: Based on Types of Policy, Age and Gender
The tables below present the average monthly life insurance rates for male and female buyers’ different types of life insurance plans: a 10-, 20-, and 30-years term policy, a whole life insurance policy paid by different age groups, and a no-medical-exam policy.
Term Life Insurance Cost by Gender
| Term Length | Gender | $250,000 | $500,000 | $1,000,000 |
|---|---|---|---|---|
| 10 years | Male | $13.47 | $20.39 | $30.63 |
| Female | $12.11 | $17.20 | $25.55 | |
| 20 Years | Male | $18.71 | $30.10 | $51.52 |
| Female | $16.42 | $25.35 | $42.49 | |
| 30 Years | Male | $27.64 | $46.29 | $83.34 |
| Female | $23.65 | $38.84 | $68.64 |
Term Life Insurance Cost by Age
| Gender/Age | 25 | 35 | 45 | 55 |
|---|---|---|---|---|
| Male | $26.84 | $30.10 | $60.56 | $150.73 |
| Female | $21.00 | $25.35 | $47.70 | $108.45 |
No-Medical-Exam Term Life Insurance Costs by Gender
| Gender | $250,000 | $500,000 | $1,000,000 |
|---|---|---|---|
| Male | $17.16 | $27.86 | $48.59 |
| Female | $15.07 | $23.73 | $39.91 |
No-Medical-Exam Term Life Insurance Rates by Age
| Gender/Age | 25 | 35 | 45 | 55 |
|---|---|---|---|---|
| Male | $25.37 | $27.86 | $59.15 | $151.58 |
| Female | $19.82 | $23.73 | $46.29 | $110 |
Whole Life Insurance Cost by Gender
| Payout Length | Gender | $250,000 | $500,000 | $1,000,000 |
|---|---|---|---|---|
| 10 Years | Male | $1,286 | $2,572 | $5,144 |
| Female | $1,206 | $2,412 | $4,824 | |
| 20 Years | Male | $545 | $1,089 | $2,145 |
| Female | $493 | $986 | $1,947 | |
| 65 Years | Male | $423 | $843 | $1,650 |
| Female | $384 | $763 | $1,492 | |
| 99 Years | Male | $288 | $571 | $1,121 |
| Female | $243 | $481 | $947 |
Whole Life Insurance Rates by Age
| Gender/Age | 25 | 35 | 45 | 55 |
|---|---|---|---|---|
| Male | $393.00 | $571.00 | $866.00 | $1,380.00 |
| Female | $346.00 | $481.00 | $716.00 | $1,173.00 |
Life Insurance Policies and Transgender Applicants
There is currently no set policy regarding transgender applicants in the life insurance sector. Although it is up to the underwriter to decide, insurers usually issue coverage based on your current gender rather than the one you were assigned at birth. Your rates won’t change as a result of transgender change surgery. It’s against the law for insurance companies to discriminate against transgender people.
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Conclusion: How much should I Pay for Life Insurance?
When it comes to life insurance, everyone has different requirements. To evaluate how much coverage is ideal for you, it’s essential to look at your unique circumstances. Factors to consider include your dependents, your lifestyle, your current financial status, and your future long-term plans. Our local life insurance agents will assess your insurance needs and help you find the most suitable insurance plans at a competitive cost. Start your life insurance journey with professional assistance to ensure you are not overpaying for your life insurance plan.
FAQ's
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What is the average life insurance cost per month?
The estimated monthly cost for life insurance is $26. This is based on a 40-year-old purchasing a $500,000, 20-year term life insurance policy—the policy—the most popular term length and amount covered. But life insurance costs differ between applicants, insurers, and policy types.
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How much does a $50,000 life insurance policy cost?
A $50,000 whole life insurance policy will cost approximately $70-$500 a month. Any life insurance policy’s cost varies depending on your age, health, way of life, use of tobacco, and the kind of coverage you choose.
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How much does a $10,000 life insurance policy cost?
For a $100,000 life insurance policy with a 10-year term, the average monthly cost is $11.02, and the cost for a 20-year term is $12.59.
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What is the cheapest way to get life insurance?
The simplest and most affordable type of policy is term life insurance, which is adequate for most people. It covers you for a predetermined number of years when you have financial responsibilities or dependents, such as paying off a mortgage or raising children.
Find Insurance Agents Near You
Get quotes from verified agents easily.
Find Insurance Agents Near You
Get quotes from verified agents easily.