Average term life insurance rates by age

Average term life insurance rates by age! Get an idea of how much you will pay for life insurance based on your age, gender, health, and more. If you are looking for life insurance, there are dozens of companies to choose from, terms, and amounts of coverage.

There is no doubt about the value of your decision and it can determine what kind of policy you choose. For that price snapshot, NerdWallet compares the average life insurance rates for men and women of different ages and health levels, across multiple coverage options.

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What is Term Life Insurance?

Within an insurance policy, term life insurance guarantees a certain death benefit if the policyholder dies within a specified period. The term can last from one year to 30 years. Importantly, the term life insurance policy is not financially valid unless the holder dies within the term. However, term life insurance can be less expensive than other life insurance options, such as full life insurance.

Average term life insurance rates by age

Life insurance companies use age as an important determinant for your premiums. The rate increases as you get older as your life expectancy decreases.

Below are life insurance quotes for a 500,000 death benefit for a 20-year term life insurance policy.

The increase in monthly premium is much smaller than your age if you are younger as you get older. For example, the average life insurance quote increases only 6% between the ages of 25 and 30, but it jumps much higher between the ages of 60 and 65 – an average increase of 86%, or $ 275 per month.

How Term Life Insurance Works

When you buy a term life insurance policy, the insurance company determines the premiums based on the policy’s value (the payout amount) and your age, gender, and health. In some cases, a medical exam may be required. The insurance company may also inquire about your driving record, current medications, smoking status, occupation, hobbies, and family history.

If you die during the policy term, the insurer will pay the policy’s face value to your beneficiaries. This cash benefit which is, in most cases, not taxable may be used by beneficiaries to settle your healthcare and funeral costs, consumer debt, or mortgage debt, among other things.2 However, if the policy expires before your death, there is no payout. You may be able to renew a term policy at its expiration, but the premiums will be recalculated for your age at the time of renewal.

Term life is usually the least expensive life insurance available because it offers a benefit for a limited time and only one death benefit. For example, a healthy 35-year-old non-smoker can typically get a 20-year level-premium policy with a face value of $ 250,000 to 20 to $ 30 per month.

Depending on the issuer, there will be significantly higher premiums for whole-life equivalent purchases, perhaps $ 200 to $ 300 per month or more. Since most term life insurance policies die before the term expires, the overall risk of the insurer is less than that of a permanent life policy. Reduced risk allows insurers to provide cost savings to customers in the form of reduced premiums.

Interest rates, the financial condition of the insurance company, and state regulations can also affect premiums. In general, companies often offer good rates at “breakpoint” coverage levels of $ 100,000, $ 250,000, $ 500,000, and $ 1,000,000.

How much is life insurance?

The average cost of life insurance is $ 26 per month. It is based on information provided by Kotasi for a 40-year, 20-year, 500 500,000 term life policy purchase, which is the most common term and the amount sold. But life insurance rates can vary dramatically between applicants, insurers, and policy types.

How life insurance rates are determined

Your Age: Generally, young people pay less for life insurance. This is because as you get older, your life expectancy decreases, and your insurer’s chances of paying off your policy increase. That’s why it’s wise to buy life insurance as soon as possible; The longer you wait, the older you get.

Your gender: Since women have longevity, women will almost always pay less than men of the same age and health. According to the latest data from the Centers for Disease Control and Prevention, the life expectancy in the United States is 79.9 years for women and 74.2 years for men.

Your smoking status: Because smokers have a higher risk of developing health problems such as respiratory illnesses, life insurance for smokers is more expensive.

Your health: This includes any pre-existing conditions as well as your blood pressure and cholesterol levels. Insurers will also look at your height and weight.

Your driving record: If your record contains DUIs, DWI, and major traffic violations, your insurer may consider you a high-risk life insurance applicant and charge you a higher rate.

Your family medical history: Your insurer may ask if you have a family history of serious health conditions such as heart disease, cancer, or diabetes.