Many people are not sure about the likely cost of taking out life insurance and can be put off considering buying life insurance because of this perceived high cost. The tables below provide estimates of the monthly cost for term life insurance based on Age and the amount of coverage required, using different length terms. The purpose of these tables is to provide you with a guide to illustrate the likely cost of life insurance. For a more personalised estimate, please feel free to enter your zip code and see estimates based on your location.
Hopefully will be surprised to see how affordable these policies can be. Most Americans believe life insurance is expensive, but do not have anything to base this assumption upon. A recent survey found that 80% of individuals were not aware of how much term life insurance costs. Indeed many were over estimating and these ranged between 120 - to over 200%, with the younger population over estimating the most.
These tables assume a preferred best rate class, someone who is in prime health, a non smoker and no previous medical conditions. Therefore these are samples and are in no way to be considered the actual amount you will be eligible for.
These policies by design will not change for 10 years from the date your policy goes live, or active. At the end of 10 years you may have the option to extend the policy and in this circumstance, the premium will increase once per year. However, these increases can be dramatic so this is something to remember.
In order to provide you with an idea as to how much a 10 year policy will cost, the table shows sample quotes based on sample amounts insured and the insureds age.
Similar to the 10 year policy, a 15 year term life insurance policy will remain with the same premium for the term of the policy. At the end of the 15 years, the policy can be set to remain in force with an annual increase in premiums that may be significant. This term is not common, it mostly used in conjunction with mortgage protection policies or possible covering the number of years left to retirement or for a business loan protection. The current general trend it to 10 and 20 year policies.
The table illustrates sample rates for polices based on age and amount of coverage required. With this length of policy age does become an issue where people at aged 80 or over will not be able to apply for this policy.
This term is currently the most popular. As before the payments reman level for 20 years and at the end of the 20 year term, the policy can remain in effect, but the premiums will increase significantly. This term is provided by every major insurance company and due to this competitive nature it keeps the insurance premiums competitive. It is usually used for mortgage protection policies and is particularly favoured amongst younger couples looking to keep costs down when purchasing their first home.
The costs are shown broken down by Age and amount of cover. As with the previous table, it is not available for the over 80's. There are policies that can provide coverage for this age group such as whole life, universal life or term policies to a set age or a shorter term.
These length of term policies are quickly becoming a favourite of the younger generation as they seem as a low cost way of protecting their young families for a significant period of time. The length of term is also a perfect match for the 30 year mortgage policies which are becoming the normal length for people just starting out buying their first home.
A potential issue with these length of term polices is the negative effect inflation can have on them. The amount of cover is not updated and thus would decrease in real terms over time as inflation increases the cost of living. Of course if the policy is required purely for mortgage protection purposes, then this is not an issue.
Due to the length of term, this policy is not available to people in the higher age bands and shorter terms should be considered or policies that go to a set age.
To obtain your own cheap term life insurance rates, enter your zip code and see the quotes available to you from the most competitive providers in your area.
It is important that you obtain at least three different term life insurance quotes to ensure you obtain the best value for money. You should check the benefits and costs of each quote to make sure they match what you are looking for. What ever policy you consider to be most appropriate ensure that its is affordable and within the budget you have set aside for its purchase.