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Average Cost of Life Insurance

When making any big life decision, it’s helpful to assess both the costs and the benefits. Life insurance is one of those decisions that can greatly impact you and your loved ones’ lives. Figuring out how much life insurance is and how it can benefit you are the first questions you’ll need to get answered. Here’s how much life insurance costs, average costs for term and whole life plans, and factors that can affect the cost.

How much is life insurance?

Using our life insurance calculator may help you determine how much life insurance you need and can help you forecast your potential life insurance cost per month, also known as premium payments.

How life insurance works

Life insurance is a contract between the policyholder and the life insurance company that can help financially support your loved ones. In exchange for paying premiums, the insurer will provide a payout to your beneficiaries if you pass away while the policy is active.1

What is the average cost of life insurance?

The average life insurance cost varies greatly depending on the type of plan you own. Term life insurance is a life insurance plan that you pay into for a fixed period of time, like 10, 20, or 30 years. These plans are often less expensive than their alternative. However, your beneficiary only receives the payout (or death benefit) if you pass within the specified term.2 Alternatively, whole life insurance is typically more expensive, but the beneficiary will receive the death benefit regardless of when you pass — hence the name, whole life.3

The average cost of life insurance per month is $26.4  How much you’ll pay monthly for life insurance can depend on what you’re looking for in a plan, so we don’t recommend using this number as the ultimate baseline.

Each life insurance company will assess how much of a risk you are based on your lifestyle, and the price of life insurance will reflect this. Since how old you are can help insurance companies better understand the risk, you may want to explore how life insurance rates by age can change.

Term life insurance average cost by age and gender

Term life insurance costs are mainly influenced by the age of the policyholder, their gender, and how long the specified term is. The specific costs depend on the insurance company you choose, but a few factors can help you understand potential term life insurance costs.

In general, term life insurance is more expensive the older you are. Additionally, term life insurance is more expensive for men than women because men tend to have shorter life expectancies.4

On the other hand, term life insurance is less expensive when the term length is shorter. So, a 10-year term life plan would typically be less expensive than a 30-year term life plan. Lastly, the face value, or the amount of money you choose to have paid to your beneficiary, impacts the life insurance cost.5 Typically, you will choose the term length and face value upfront, when your term life insurance plan is being created.

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Whole life insurance average cost by age and gender

In a whole life insurance plan, the term length is non-existent, so the length of the plan won’t change the cost of this permanent life insurance. However, the same influences of age and gender also apply to whole life insurance costs.

Some whole life insurance plans allow you to decide how you want to pay premiums. You can pay it all upfront, or over 10, 20, or 25 years. The payment structure you choose can impact overall costs and benefits of your life insurance plan.

The whole life insurance plan must be fully paid for in full for the beneficiary to be able to access all the benefits. We recommend chatting with an insurance agent to determine how beneficiaries can complete the plan’s payments if needed. Additionally, the overarching face value of your plan will impact the total life insurance cost.6

Factors that affect the cost of life insurance

Here are some factors that impact how much you’ll pay for a life insurance policy:

  • Health: Your family’s medical history, weight, blood pressure, and cholesterol may all be used to help determine your overall health. Insurance companies may use this information to mold costs.
  • Smoking: Since smoking is connected to various health issues, insurance companies may change the cost based on whether or not you smoke tobacco or nicotine.
  • Occupation and hobbies: If you work in a risky job or engage in high-risk activities, your rate may be more expensive.
  • Driving Record: How you drive and how many accidents you’ve been in may be used to assess the level of risk an insurance agency has when choosing to insure you.6

Factors that don’t affect the cost of life insurance

Life insurance companies won’t use your ethnicity or religious preference to determine costs. Instead, they only look at factors that impact the risks within your life. Also, credit life insurance is the only life insurance that may need your credit score to determine eligibility and costs.

How to lower the cost of life insurance

Here are some ways you can pay less in premiums for a life insurance policy:

  • Choose the right type of policy: If you only need coverage for a certain number of years, for instance, choose term life insurance instead of a permanent policy to save money on premiums.

  • Compare quotes: It’s important to shop around online and compare quotes. Some life insurance companies may offer better rates than others.

  • Get a policy while you’re young: Getting life insurance while you’re young can allow you to lock in lower premiums for the duration of the policy.

  • Maintain a healthy lifestyle: You can qualify for lower life insurance premiums by staying healthy and not smoking.

How much life insurance do I need?

The amount of life insurance you need depends on factors such as your debts, income, number of dependents, and how long you want to be covered. For instance, you should get a policy worth 10 times your income if you want your loved ones to replace your income for that many years after your passing. Or, if you have a mortgage or other long-term debts, you should get a coverage amount that would help loved ones be able to pay these debts off if you unexpectedly pass away.

Get life insurance from Aflac

Depending on your unique needs and goals, Aflac offers both Term and Whole life insurance plans, depending on your unique needs and goals. Speaking to an agent can help clarify what your life insurance costs could be like.

Get a quote today to see how an Aflac life insurance plan could fit into your budget. Understanding potential life insurance monthly costs can help you plan for the future better.

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