Life insurance used to be cumbersome to research and purchase, but now it's easier than ever. Not only is there a wealth of information online about life insurance, you can compare free quotes and apply for life insurance policies in minutes right from your couch. So just how much does life insurance cost by age and gender anyway?
To find the answer, let's take a look at what factors impact the price of a life insurance policy. Then we'll take a look at average price ranges for life insurance by age below.
What Determines How Much Life Insurance Costs?
First of all, here are the main factors that determine how much life insurance costs:
- Your age
- Gender
- Type of life insurance and duration
- Coverage amount
- Medical history
- Physical health status
- Mental health status
- Prescription usage
- Hospitalization history
- Prior surgeries
- Tobacco usage
- Family history of cancer
- Alcohol consumption
- Recreational drug use
- High-risk hobbies
- Occupational risk hazards
Age And Gender
The two main factors that determine how much life insurance costs are your age and gender. Typically, the younger you are the better your health and the longer your life expectancy. Therefore, the younger you are the cheaper life insurance tends to cost. No big surprises there.
Thus, it can be beneficial to purchase life insurance while you are still young to save money. If you plan to eventually get married and start a family, then getting life insurance beforehand is also a wise move. A lot of health issues can and will arise as we get older.
Like it or not, gender also plays a role in life insurance pricing. Men tend to die younger and thus pay more than women on average. Sorry gents!
And if you so happen to be transgender, unfortunately there's no set protocol. It's ultimately up to the insurer's underwriter to determine if your current gender or your gender at birth will be used.
Type, Coverage, Duration
The type of life insurance you purchase, term life insurance versus whole life insurance, also greatly impacts how much you pay. Term life insurance is much more affordable than whole life. Thus, term is the most commonly purchased type of life insurance.
Next, the amount of coverage you want, ie. the death benefit payout amount, also impacts price. Naturally, more coverage costs more money. And the length of time, or duration, of the life insurance policy also affects price. Longer coverage, higher cost. Pretty straight forward.
Medical history
Where things can get complicated with pricing are your medical history. Expect to answer questions about smoking, alcohol consumption, and recreational drug use.
Life insurance companies also want to know if anyone in your family is diagnosed or has died from cancer. They typically also want to know if you or anyone in your family has ailments like diabetes, high blood pressure, cardiac arrest, etc.
Lifestyle And Occupational Risks
Generally, you're going to get the best pricing if you don't have any medical conditions, aren't taking any prescription drugs, and don't do any kind of high-risk activities.
If you are a skydiving enthusiast, scuba diver, pilot, roofer, or work with toxic chemicals expect to face higher premiums. Tempted to keep your high-risk hobbies or occupational risk hazards a secret?
I'd strongly advise against withholding information or lying on your application because it could leave your beneficiaries with nothing. Life insurance companies reserve the rights to deny claims if they determine a policy holder lied or withheld such information when the policy went into effect.
However, you have every right to seek a new occupation that's safer. Maybe you're a construction worker by day and a professional blogger by night. Saying you are a writer or blogger on your life insurance application is the truth.
What Does Not Affect The Cost Of Life Insurance?
While it may seem like everything under the sun can impact how much life insurance costs, the factors below have zero impact on policy pricing:
- Where you live
- Number of dependents
- The number of life insurance policies you hold
- Number of beneficiaries
- Race
- Ethnicity
- Sexual orientation
- If you have pets (unless you're the next Joe Exotic)
If you live in a skyscraper or a high-risk area for earthquakes, hurricanes or other natural disasters, that won't affect the cost of your life insurance policy.
But, you may want to consider buying natural disaster insurance. Living in an area prone to violence and crime also has no impact on life insurance premiums.
In addition, whether you have 0 kids and 1 beneficiary or 6 kids and 10 beneficiaries also has no impact on how much life insurance costs.
Although life insurance companies use gender to determine policy pricing, they can't discriminate on your race, ethnicity, or sexual orientation.
Average Cost Of Life Insurance For Men
Ok, so how much does life insurance cost on average for men in the US by age? Here's a look at typical rates for men between the ages of 20 and 60 (non-smokers, Preferred health rating). The term length is for 30 years and these are monthly costs, not yearly costs.
Remember, men have lower life expectancies than women. The average life expectancy for men in America is roughly 76.1 years according to the National Center For Health Statistics.
Average Cost Of Life Insurance For Women
Now let's take a look at the average cost of life insurance for women by age (non-smokers, Preferred health rating). Again, the term length is for 30 years and these are monthly costs, not yearly costs.
The average life expectancy for women in America is roughly 81.1, or a significant five years longer than the average male life expectancy. Therefore, if you are a woman, you should probably get a longer term life insurance policy at the margin.
When you compare the cost of life insurance by age and gender, it is apparent that women pay on average 10% – 20% less than men.
Related: Why The Best Age To Get Life Insurance Is 30
How Much Does Life Insurance Cost Me?
When I was 34 years old, I took out a $500,000 life insurance policy with USAA. It was a 30-year term life policy for $66.65/month. I thought that was a great rate at the time.
We always thought that USAA would provide the best rates because they were providing financial solutions to military members and their families. Sam's dad fought in Vietnam and his grandfather got a Congressional Gold Medal serving during World War II. Surely, we'd get the best life insurance rates possible.
We were wrong.
Fast forward to the summer of 2020. Sam and I decided it would be beneficial for me to try and increase my coverage now that we have two kids. Since we are both guardians who co-manage all our finances, it didn't make sense to have mismatched life insurance coverage amounts.
It didn't cost anything to look at life insurance quotes. I simply input my info into the free PolicyGenius marketplace. I quickly realized I was vastly overpaying for life insurance. For the past six years, I was paying $20 a month more for 50% less coverage!
Thanks to the ease of using PolicyGenius, I applied for a 20-year, $1,000,000 policy with Principal for $42.80/month. About three weeks later I was approved and I signed up right away.
Comparing my pricing to the average cost of life insurance for women in the above table, I'm pleased to see I'm paying $9.92 less per month than average ($52.72 – $42.80). Further, I've now got double the life insurance coverage ($1M vs. $500K) for less. Sweet!
Click on the calculator below to get your own quotes on Policy Genius right now.
Life Insurance Is A Must
There's nothing like a global pandemic to remind us that tomorrow is not guaranteed. If you have debt and dependents, getting life insurance is important.
It took a pandemic for Sam and I to realize that we had mismatched life insurance coverage amounts. Hopefully, this uncertain time will also encourage you to take action to ensure your loved ones are protected as well.
If you don't yet have a life insurance policy, want to find out if you're overspending on your current policy, or want to see how much it would cost to get an additional policy, I recommend you check out PolicyGenius.
PolicyGenius is an insurance marketplace that makes it super easy to get free life insurance quotes. Not only that, their reps can answer any questions you have when comparing policies. They aren't paid on commission so you don't have to worry about being up-sold.
Readers, when was the last time you shopped for life insurance? Are you surprised at the above pricing tables of the average cost of life insurance for men and women? What type of life insurance do you have now and how much are you paying a month? Do you know how much life insurance costs for your age, sex, and health?
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What do you think of state farm? I am 29, and just got quote from State Farm for $70 for 30yrs term. It’s definitely higher than what I could’ve got on PolicyGenis, but thought it’s convenient for me to get all the insurances from the same company.
What’s the policy amount?
As other commenters said, would be helpful to clarify the tables by stating those are *monthly* rates, not annual.
Have included and bolded! Thanks
Get life insurance before you have any kind of health issues. I applied in my 30’s and have a couple non life threatening issues and was quoted over $800 per month for a million dollar 30 year term policy.
Thanks for the insights as always. How about if you have it thru work? Do you recommend additional life insurance?
Employer life insurance caps out at some multiple of salary, and it ends when you’re job ends. The rates are typically good though. How much to buy depends entirely on your goals and how long your survivors need financial assistance.
I started to shop for outside life insurance when I was laid off in my early 40s. Fortunately, I was still healthy and relatively young, so I’m paying $818/year for 20 years for $1M coverage. If you don’t lock in your a lower rate when younger, you will be paying a high rate.
My goals was to ensure financial security for my kids while they were young. After my kids are grown, my wife is on her own. Just kidding, my wife is set if I pass away (even without life insurance), but I’m worth more alive…for now.
Good article on an important topic. Would aid in clarity if the tables listing age and premium mention that the numbers are monthly payments. I’ve just bought term life insurance through AMICA and it was a good experience. Since I have my automobile insured through them, I also get a small discount on my auto policy.
Just got life insurance via Bestow. Only 10-20 year terms… but no medical exam and pretty fair rates. Only cover people under 45. I got $500k for 20 years which will take me to 61. Only one child who will be 28 by then. I’m content with that.
I have a $250k policy I overpaid for at 34… rushed and had some bad blood work that raised my rate to $38 a month for only $250k. Gonna cancel that one now that I got double the coverage via bestow. I’ve also have another $150k through my wife’s work.
To Paul:
I don’t think having debt should be the deciding factor for purchasing life insurance. I’m up to my eyeballs in debt, much more than before, but I now regret purchasing life insurance. As long as your survivors have the financial resources and flexibility to continue their standard of living, I don’t believe life insurance is a must.
In 2014, in my early 40s with two young kids and freshly laid off, I purchased 20 year term $1M insurance for $818/yr for me and $650/yr for my wife. It was the prudent thing to do given that I had lost my employer sponsored life insurance and my job. I was somewhat less financially independent by then, but the extra security was nice during such uncertain times. My wife retained her job and benefits.
In the intervening years, I’ve been diversifying our stock portfolio into real estate. This really juiced our returns, but I have a large mortgage for each property I own. Despite the debt, our net worth has really benefited from this bull market. If I was somewhat financially independent in 2014, I definitely am now. The life insurance premiums no longer make sense, but I’ve already paid into it for the last 6 years. Just for kicks, I got a quote for a 15 year policy right now, and it would cost $1116/yr so I feel like my $818/yr is a “deal”.
Aside from the insurance, should one of us face our untimely demise, the surviving spouse (or our children) will hit the financial lottery because of the step up in cash basis. If they are short on cash, they can sell any property or stock with zero capital gains to cover a shortfall in cash flow. The investment properties pay for themselves so really they would just need some cash to cover basic living expenses including our primary residence mortgage. Money has already been set aside in 529s for the kids. If they really wanted to, they could sell some stocks to pay of our mortgage, but why would they given our mortgage rate is 3% and tax deductible?
Don’t get me wrong. An extra $1M would be nice, but given the probabilities, I don’t think it was a good bet…like most insurance. If the cost benefit were in our favor, insurance companies would be out of business.
Sam, where can I read about your grandfather’s congressional medal?
Hi Paul,
Recently, Congress honored the Chinese American Veterans who served in WW2 here:
https://www.caww2.org/
It was a nice gesture, especially since Chinese And Chinese Americans faced a lot of discrimination back thenz
Do you have any posts on your opinion on coverage amount based on life circumstances?
Personally, I have coverage which is 16x my income. My insurance broker recommend 7x earnings, I felt that was insufficient.
I wanted to ensure my wife would have the ability to care for our children indefinitely without having to worry about finances indefinitely. Kids are currently 7, 5, & 3.
Currently have $1M universal life + $3M term. Add on our approximately $3M net worth and she could have a safe withdrawal rate of $250,000k and focus 100% of her time on raising out children.
It sounds like you have a sufficient amount of life insurance coverage based off your net worth. It’s really great that your family is so protected.
For perspective, our life insurance coverage amounts don’t come close to covering our net worth. We want to have enough life insurance as a stopgap so that there are no rash investment decisions to be made to come up with any liquidity.
Here are some related posts I wrote in the past with some scenarios:
https://www.financialsamurai.com/how-much-life-insurance-do-i-really-need/
https://www.financialsamurai.com/the-right-amount-of-life-insurance/
I have never even thought of getting a life policy. I just get the life policy that my company pays me plus the bare minimum life insurance on top of that, effectively making it I think 2-3x my salary, I forget which.
I’m not so sure if having a life policy is the right path for me at the moment. I do think it’s a better path to take in about 5-10 years but it’s good to be aware early to make a decision later down the road.
If you’re young and don’t have any dependents, then your employer sponsored plan is probably sufficient for your current lifestyle if the coverage is greater than your outstanding debt balances.
You’re lucky to have access to life insurance through your employer because those type of benefits are harder to come by these days. If your needs outgrow that plan down the road, then you can always purchase additional coverage on your own.
That’s what I did when I was young and first starting out on my own. I just used the life insurance I had through work for many years which was 2.5x my salary. Then as my life changed I needed to purchase additional life insurance.
Your tables above… what is the term length? As you said, duration is an important factor of coverage.
For reference, I have a 30-year $750k policy with a $42.80 premium that I got as a healthy 31-year old male a couple years ago. So your tables look pretty accurate for that sort of duration. Since getting that policy, my wife and I have had a second child and moved to a larger house with a 25% higher mortgage. I’m considering getting another $250k now while I’m still young and healthy. My employer gives something like 1x salary as well.
More important than me extending my coverage, however, is my wife getting a policy! My salary is almost ~40% more than hers, but because we live in California I would struggle to raise the children financially solely on my income without making some lifestyle changes.
Just typing this out has pretty much made me realize we need to get this ball rolling! 2021 New Year’s Resolution? :) Thanks for lighting the fire under me!
Good question! The term length is for 30 years. The average monthly life insurance will therefore be less for shorter terms.
I think it’s worth getting more coverage given your increase liability and second child. The cost is so affordable at your age. If you don’t need the coverage at some point in the future, you can always cancel it. The option value of being able to lock in a lower rate is valuable.
The mismatch in terms of life insurance coverage amounts by spouse is something that was really eye opening for us as well. I had twice the amount of coverage as my wife. But we are equal partners here, so I didn’t make sense. For you guys, I would say most definitely your wife should have some type of coverage at the minimum.
GL!
I dreaded getting a life insurance policy for the longest time. I don’t know why I thought it was going to be so difficult. I guess I also didn’t want to get my blood drawn. Fortunately, I got a policy that didn’t require any lab testing. They just used my medical records. I used PolicyGenius too cuz I didm’t know where else to start and I heard good things. I’m paying about $45 bucks a month for a $750k policy that should get me to age 60. I’m happy with that. Glad to see I’m in the normal pricing range.
Thoughts on buying two policies from different companies in case one was to go bankrupt?
I don’t think that’s necessary. Stick with a top 10 life insurance carrier that has been around for decades and has a strong balance sheet.
During the 2008 to 2009 financial crisis, I remember AIG got bailed out. It was too big to fail, and since then, life insurance carriers have significantly improved their balance sheets. I don’t think the federal government will allow any of the large carriers to fail.
Here are some of the largest life insurance carriers.
The issue is, it’s a pain to check the latest rates by going and applying to them one by one. This is why checking online with PolicyGenius is much more efficient.
I’d love to get your opinion (or anyone else’s) on the need for life insurance once all debts are paid off and you have achieved FI? I have 2 kids and used to have life insurance when working full time, but now I struggle to see the importance as we don’t have a traditional income for it to help cover in case of emergency.
It’s a great question that my wife and I have discussed before. Maybe I should write a new post about it.
If you don’t have any debt, and if you have a really robust portfolio that generates enough passive income to cover all your living expenses, the life insurance is not necessary.
However, term life insurance is cheap, and it makes me feel good to have life insurance to pay the lawyer fees, any short term bills, and so forth during a difficult time.. The last thing I want is for my surviving loved ones is to have to make emotional investment decisions to raise capital to pay for life.
Life insurance would be a good financial buffer during the grieving process.
Last time I tried to get life insurance one carrier quoted me one rate and then quoted me a 3X higher rate three weeks into the process. It’s so frustrating getting life insurance sometimes. Glad there are digital solutions.
Unfortunately, this is not uncommon, especially if you do bloodwork or don’t disclose everything on your life insurance exam.
Sam can you do an article going over the benefits and pitfalls of whole life cash value insurance as an addl wealth builder, long term care benefit, ability to take tax free loans, deductibility as a business.
Probably not at the moment. Need to take my boy out to practice soccer. It’s been 70 degrees every day this week in SF. So nice!
But here’s a primer on whole life insurance.
I’ve wondered how Policygenius compares to independent insurance agents? I would guess that independent insurance agents will be able to take into consideration more personal decision making. Is this a career killer for insurance agents and if not, what value does individual agents bring to the table that an app doesn’t.
PolicyGenius compares very well. Part of their business model is to sidestep the independent insurance agents and make getting real quotes as easy and efficiently as possible. They held our hands the entire way during the process and made recommendations and guidance on the pros and cons etc.
I was impressed with their follow through. And my wife was obviously impressed since she went though with a new term life insurance policy with double the coverage for less money.
I’ve met the co-founders before multiple times (in SF, Denver, and NYC). They are doing great work, and I’m glad they are still married! Working to build a business together for so long is not easy.
I’ve always wondered how much life insurance costs. It’s not as bad as I thought since I’m 25. I plan to get married this year so I’m gonna look at quotes and plan to buy a policy with my fiance before the wedding.
For most 25, term life insurance is so cheap. If you are planning to get married and start a family, I would get a 25-30-year policy. Don’t do what I did and get only a 10-year policy at age 35! I really regret not getting a longer term policy now that I’m a dad of two.
The pandemic has definitely made me think about my mortality and the importance of life insurance. I also use PolicyGenius to lower my life insurance premiums. It’s really great how they elucidate the various options. I decided to go with Principal life insurance after comparing all the options.
It’s pretty amazing how opaque life insurance quotes are!