Whole life insurance is a permanent life policy that provides coverage during your entire lifetime, meaning it will never expire. As long as you pay your premiums, the policy will pay out a death benefit to your beneficiaries after you pass away. Let’s dive deeper into how whole life insurance works, its benefits, how much it costs, and typical rates by age.
With a whole life insurance policy, you receive lifelong coverage. Typically, you’ll pay the same premium for the duration of your policy.1 The death benefit that your beneficiaries or loved ones receive upon your death will also stay the same, no matter how long you live. In addition, your policy may build cash value, which will increase over time as you pay your premiums and be available for you to use while you’re still living.
Whole life insurance is designed to last for your entire life, regardless of how old you are when you pass away. Upon your death, it will pay a death benefit to your beneficiaries. The cash value growth component of the policy accumulates tax-free. You can tap into this money through a loan or partial withdrawal.
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Here’s a look at monthly life insurance premiums by age for men and women for $250,000 worth of coverage.2
|Age 25||$199 per month||$175 per month|
|Age 35||$288 per month||$243 per month|
|Age 45||$435 per month||$360 per month|
|Age 55||$692 per month||$589 per month|
There are many other factors that impact premiums for whole life insurance, including:
Studies have shown that men have a lower life expectancy than women. Therefore, you may pay more for a whole life insurance policy if you’re a man.
Many life insurance companies will look at your medical history. You can expect higher rates if you have a chronic or serious illness than someone who is in reasonably good health.
Not all whole life insurance policies are created equal. The insurance company you choose, as well as the coverage amount, will help dictate your rates.
If you’re a smoker, you’ll likely pay more for a whole life insurance policy than a non-smoker. This is because of the various medical conditions smoking can cause.
You might have to settle for higher whole life insurance rates if you have a risky job or hobby. For instance, firefighters, police officers, construction workers, and skydivers pose a higher risk for life insurance companies.
Whole life insurance policies usually come with higher premiums than term life policies. This is because the coverage lasts your entire lifetime, and the policy comes with a cash value component.
Whether whole life insurance is worth the investment depends on your unique goals and preferences. If you prefer coverage that lasts your entire life and don’t mind paying more for it, this policy may make sense. Whole life insurance can also be a good option if you have long-term financial needs because you own a business, have a defined benefit pension plan, or are concerned about the sustainability of your retirement income.
While whole life insurance often costs more than term life insurance, it may be worthwhile, depending on your situation. If you’re looking for a policy, Aflac offers whole life insurance coverage at competitive rates. This policy can help you meet your financial goals and receive coverage for life. Request a quote today!
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1 Investopedia - Whole Life Insurance Definition: How It Works, with Examples. Updated September 7, 2022. https://www.investopedia.com/terms/w/wholelife.asp. Accessed March 28, 2023.
2 Policygenius - Whole Life Insurance Rates for April 2023. Updated March 20, 2023. https://www.policygenius.com/life-insurance/whole-life-insurance-rates/. Accessed March 28, 2023.
3 Bankrate - What happens if you outlive your term life insurance? Updated July 21, 2022. https://www.bankrate.com/insurance/life-insurance/outlive-term-life-insurance/. Accessed March 28, 2023.
In Arkansas, Idaho, Oklahoma, Oregon, Pennsylvania, Texas, & Virginia, Policies: ICC1368100, ICC1368200, ICC1368300, ICC1368400. In Delaware, Policies A68100-A68400. In New York, NY68100-NY68400.
Coverage may not be available in all states. Benefits/premium rates may vary based on state and plan levels. Optional riders may be available at an additional cost. Policies and riders may also contain a waiting period. Refer to the exact policy and rider forms for benefit details, definitions, limitations and exclusions. For complete details, including availability and costs, please contact your local Aflac agent.
The content herein is provided for general informational purposes and is not provided as tax, legal, health or financial advice for any person or for any specific situation. Employers, employees and other individuals should contact their own advisers about their situations.
Aflac insurance coverage is underwritten by American Family Life Assurance Company of Columbus. In New York, coverage underwritten by American Family Life Assurance Company of New York.
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