Average Cost of Life Insurance (2021): Rates by Age, Term and Policy Size
Life insurance companies base their rates primarily on your age and health status, but they also consider your job, weight, smoking status, and even your family's health history. Life insurance quotes, unlike other types of insurance, are not affected by your location. We've compiled rates for a variety of policy types and customer profiles at LowCostInsurance to calculate the average cost of life insurance.
Average term life insurance rates by age
We began our analysis by displaying the change in average life insurance rates for various age groups. Age will be used by life insurance companies to determine life insurance premiums. Rates will continue to rise as you get older due to a reduction in your total life expectancy.
The term life insurance quotes shown below are for a 20-year term life insurance policy with a $500,000 death benefit.
Our findings show that the increase in monthly premiums as you age is much smaller when you are young versus when you are older. For example, the average life insurance quote increases by 4% between the ages of 25 and 30, but it increases by 86%, or $275, between the ages of 60 and 65.
Age | Monthly life insurance cost (nonsmoker) | Monthly life insurance cost (smoker) |
25 | $31 | $86 |
30 | $33 | $92 |
35 | $38 | $117 |
40 | $50 | $179 |
45 | $78 | $277 |
50 | $118 | $426 |
55 | $190 | $663 |
60 | $318 | $1,007 |
65 | $593 | $1,528 |
As you can see, premium differences are even more pronounced if you smoke. When compared to nonsmokers, smokers pay 218 percent more in premiums for life insurance policies.
Average cost of life insurance by gender
Aside from your age, life insurance quotes will differ depending on your gender. Men, on average, pay 23% more for term life insurance than women.
This is due to the fact that men have a lower life expectancy than women. Life insurers take this into account, and thus charge a man higher rates than a woman of the same age.
Age | Policy face value | Male premium | Female premium |
30 | $250k | $21 | $18 |
$500k | $33 | $28 | |
$1m | $58 | $49 | |
40 | $250k | $30 | $25 |
$500k | $50 | $41 | |
$1m | $93 | $76 | |
50 | $250k | $67 | $52 |
$500k | $118 | $92 | |
$1m | $226 | $173 |
Term life insurance rates by policy size
The face value of your life insurance policy, which is the dollar amount that would be paid to your beneficiaries if you died, is critical to your financial planning. As a result, depending on your assets and future expenses, you should carefully evaluate and calculate the correct face value. You can adequately provide for your loved ones by selecting an accurate face value for your life insurance policy.
Term life insurance rates by policy length
The tables below detail quotes for 10- and 20-year term life policies. As you can see, the shorter the term length, the cheaper the life insurance premiums you will have to pay each year.
The premiums have been broken down by rating class. A rating classification is the health rating assigned to you by the life insurance company after you have taken a medical exam. The rating you receive will have a direct impact on the premium you pay for your life insurance policy. These metrics are determined by each individual life insurance provider and only slightly differ across the industry. We have provided a detailed description of the various classifications on this page.
10-year term life insurance rates
People on a limited budget may prefer 10-year policies because they provide some of the lowest rates available. A 10-year policy can also be beneficial for someone who does not require long-term insurance.
Policy face value | Preferred plus | Preferred | Standard |
$100k | $16 | $19 | $22 |
$250k | $23 | $28 | $37 |
$500k | $35 | $44 | $61 |
$1M | $59 | $76 | $110 |
20-year term life insurance rates
The most popular term life insurance option on the market, the 20-year term policy, offers more coverage than the shorter 10-year term policy, but at a higher annual rate.
These policies are typically recommended for young families who frequently have large debts and expenses, such as mortgages and student loans, that would become extremely burdensome if the family's breadwinner died unexpectedly.
The 20-year term is usually long enough for the family to significantly pay down these debts and reduce the risk of someone else having to foot the bill if something goes wrong.
Policy face value | Preferred plus | Preferred | Standard |
$100k | $17 | $19 | $23 |
$250k | $25 | $30 | $38 |
$500k | $40 | $49 | $65 |
$1M | $69 | $86 | $117 |
Generational views about the cost of life insurance
According to a survey conducted by LowCostInsurance, more than a third (35%) of the total respondents do not currently have a life insurance policy.
When asked what the main reason for this decision was, more than 40% of people said it was too expensive to purchase life insurance. Furthermore, more than half (53%) of baby boomers (adults between the ages of 54 and 72) believe policy premiums are too high and, as a result, do not currently have life insurance. Investing in a policy when you are young can be cost-effective, and boomers are feeling the consequences, such as increased costs, of delaying purchasing life insurance until later in life.
When asked, "When should you buy a life insurance policy?" Over 37% of all respondents said, "While you are young and healthy."
Views as to when prospective policy holders should purchase life insurance?
Life event | Generation Y | Millennial | Generation X | Baby boomer | Silent generation |
After the birth of first child | 20% | 16% | 20% | 11% | 16% |
Once you are married | 18% | 16% | 15% | 17% | 0% |
While you are young and healthy | 27% | 35% | 36% | 42% | 47% |
After buying your first home | 8% | 10% | 4% | 4% | 11 % |
When you reach retirement age | 7% | 6% | 7% | 8% | 5% |
When you get your first full-time job/promotion | 8% | 11% | 11% | 6% | 11% |
Never | 10% | 4% | 4% | 8% | 11% |