How Much Does Life Insurance Cost?
On average, term life insurance costs around $57 per month, and whole life costs $249 per month.
Powered by SelectQuote
Excellent
)
)
Written byA.M. Steinbach
)
Full-time writer for 5+ years
Two-time Emmy Award nominee
A Harvard graduate, Mark has worked as a freelance personal finance and tech writer. He’s also written for Saturday Night Live.
Featured in
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
Edited byEvelyn Pimplaskar
)
10+ years in insurance and personal finance content
30+ years in media, PR, and content creation
Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.
Featured in
){kind=logo}
){kind=small}
){kind=small}
Updated
Why you can trust Insurify: Comparing accurate insurance quotes should never put you at risk of spam. We earn an agent commission only if you buy a policy based on our quotes. Our editorial team follows a rigorous set of editorial standards and operates independently from our insurance partners. Learn more.
Advertiser Disclosure
At Insurify, our goal is to help customers compare insurance products and find the best policy for them. We strive to provide open, honest, and unbiased information about the insurance products and services we review. Our hard-working team of data analysts, insurance experts, insurance agents, editors and writers, has put in thousands of hours of research to create the content found on our site.
We do receive compensation when a sale or referral occurs from many of the insurance providers and marketing partners on our site. That may impact which products we display and where they appear on our site. But it does not influence our meticulously researched editorial content, what we write about, or any reviews or recommendations we may make. We do not guarantee favorable reviews or any coverage at all in exchange for compensation.
Table of contents
When it comes to life insurance, you have two main options: term life and whole life. The type you choose will affect your life insurance costs. Other factors that affect costs include your age, gender, and health history.
Here’s what you should know about how much life insurance costs, factors that affect your rates, and how to save money on life insurance.
Quick Facts
Term life insurance covers you over a specified period of time, while a whole life policy offers lifelong protection.[1]
Generally, term life insurance has lower up-front costs than whole life insurance.
The amount of life insurance coverage you purchase also affects your rates.
How much is life insurance?
The overall average cost of life insurance is $153 per month, based on data from Insurify partner SelectQuote. This average premium accounts for different policy types, ages, term lengths, and coverage amounts. Seniors generally pay more for life insurance. Gender is another factor, with women typically paying less for life insurance.
Choosing between term life insurance and whole life insurance will also affect your premium payments. The following sections outline the different average rates for term life insurance policies and whole life insurance policies.
Cost of term life insurance
Term life policies last for a specified policy term — from a one-year term to a 30-year term. If you buy a term policy, your beneficiaries will receive a payout only if you pass away during the policy term. At the end of the term, you may have the chance to renew your policy.
The table below shows the average rates for term life insurance based on different ages, term lengths, and coverage levels.
Age/Gender ▲▼ | Term ▲▼ | Monthly Premium for $250,000 Policy ▲▼ | Monthly Premium for $1 Million Policy ▲▼ |
|---|---|---|---|
| 25-year-old woman | 30 years | $14 | $22 |
| 25-year-old man | 30 years | $17 | $28 |
| 45-year-old woman | 20 years | $21 | $36 |
| 45-year-old man | 20 years | $26 | $45 |
| 55-year-old woman | 10 years | $28 | $50 |
| 55-year-old man | 10 years | $37 | $67 |
Source: Insurify partner SelectQuote provided these averages based on 20-year and 30-year term policies from one or more of the companies SelectQuote represents. Rates are for men and women in excellent health. Premiums may vary depending on individual health, issuing company, and other factors.
Pros and cons of term life insurance
Term life insurance can be a good option if your beneficiaries need financial protection for a finite time. But it’s not the right choice for everyone. It’s important to consider the advantages and disadvantages of term life before committing to a policy.
Pros
Lower up-front costs
Simple and straightforward
May be convertible to whole life
Cons
Doesn’t build cash value
Premiums may increase at renewal
May be less cost-effective in the long term
Who should consider term life insurance
Term life insurance comes with lower premiums, which makes it a good choice for people on a budget. For instance, a younger parent who has high child care costs but still wants life insurance might choose a term life insurance policy to cover their family until their children are college-aged.
Find Affordable Life Insurance
Save more than 50% on a life insurance policy
Cost of whole life insurance
A whole life insurance policy (also known as a permanent life policy) offers lifelong coverage. When you buy a whole life policy, your beneficiaries will receive a payout when you pass away — it doesn’t have to occur within a specified term.
Whole life insurance policies build up cash value over time. The cash value is typically tax-deferred, and you can borrow against it in certain circumstances.[2]
The following table shows the average monthly cost of $250,000 and $500,000 whole life insurance policies based on the insured person’s age and gender.
Age/Gender ▲▼ | Monthly Cost of $250,000 Policy ▲▼ | Monthly Cost of $500,000 Policy ▲▼ |
|---|---|---|
| 25-year-old man | $64 | $113 |
| 25-year-old woman | $69 | $130 |
| 45-year-old man | $145 | $265 |
| 45-year-old woman | $124 | $219 |
| 55-year-old man | $209 | $390 |
| 55-year-old woman | $178 | $328 |
Source: Insurify partner SelectQuote provided these averages based on whole life policies from one or more of the companies SelectQuote represents. Rates are for men and women in excellent health. Premiums may vary depending on individual health, issuing company, and other factors.
Pros and cons of whole life insurance
The idea of cash value may sound attractive, but that advantage comes at a cost — premiums for whole life are generally significantly higher than for term life insurance policies. Whole life can be a good choice for some people, so it’s important to consider the advantages and disadvantages before buying a policy.
Pros
Builds cash value over time
Offers lifelong protection
May be more cost-effective in the long term
Cons
Comes with higher premiums
Fixed costs and benefits
Expensive to cancel
Who should consider whole life insurance
Whole life insurance has higher premiums but also typically comes with a cash value component that grows — tax-deferred — over time. This type of policy can be a good choice for high-income individuals or people who have a specific investment or savings goal.
For example, a parent with a disabled child might consider whole life insurance as a way to save toward the child’s financial stability when the parents are no longer alive.
Factors that affect the cost of life insurance
Like other forms of insurance, life insurance has several rating factors, which are personal details that affect your insurance costs.[3] Here are a few to keep in mind:
Age
The older you are, the more you’ll pay for a life insurance policy.
Gender
Women have longer lifespans than men, which leads to lower premiums.
Health status
People with chronic conditions — like diabetes, high blood pressure, or other health problems — typically pay higher life insurance premiums.
Personal habits
Harmful habits, like smoking, and dangerous recreational activities, like skydiving, can lead to more expensive premiums.
Coverage level and term
Whole life policies are more expensive than term life policies. Similarly, term life policies with longer coverage terms are typically more expensive.
Insurance company
The insurance company you choose will affect your rates. Choosing an insurance company with discounts and low rates can help you save.
Tips for calculating how much life insurance you need
Purchasing the right amount of life insurance coverage ensures your beneficiaries will have financial security if you pass away. Finding a coverage level that meets your insurance needs can be tricky.
Here are some options for estimating how much life insurance you should buy.
10x your income
Multiplying your income by 10 is a simple way to calculate life insurance needs.[4] It’s not the most exact method, but it can help give you a rough estimate. For instance, when you just multiply income, you don’t consider your debts and other expenses. Plus, it doesn’t account for inflation, which will devalue your income as the years pass.
Income x 10 + $100,000
After you multiply your income, add an additional $100,000 to your coverage to account for any education costs. The average annual cost of four-year colleges ranges from $9,800 for public colleges to $40,700 for private colleges.[5] Adding $100,000 can help cover a dependent’s college tuition. Overall, policyholders with dependents should consider this method in order to meet future education costs.
Income + cushion
Choosing to simply multiply annual income may not cover all your family’s future expenses. If you pass away, your loved ones need support to handle final expenses, such as funeral or cremation costs. A cushion can cover these costs. If you stay home, a cushion can also help handle child care expenses in the event of your passing.
DIME
The DIME method stands for “debt, income, mortgage, and education.” Simply add your debt payments, future lost income, mortgage payments, and education costs together to get a more comprehensive estimate of your insurance needs.[6] Though this calculation is a bit more complicated, it’s a great option for people with outstanding debts or a sizable mortgage to pay off.
Save on Life Insurance
Find a policy for 50% less when you compare through SelectQuote
How to save on life insurance
Life insurance is financial protection for your loved ones, so it makes sense to get the best life insurance policy you can afford. Here are some strategies that can help you save money when buying life insurance:
Bundle policies. While home and auto bundles are more well known, your insurance company may also offer a discount if you purchase home, auto, and life insurance from the same insurer.
Know when discounts kick in. Certain discounts kick in at set thresholds — for example, $250,000 or $500,000 limits. Purchasing a coverage level right below one of those thresholds might not be cost-effective.
Consider lifestyle changes. Quitting smoking or other habits that negatively affect your health may help you find more affordable life insurance.
Compare quotes. Just as you would comparison shop for affordable car insurance, you should compare multiple life insurance quotes. Receiving quotes from more than one insurance company and comparing them side by side is the best way to find savings.
How much is life insurance FAQs
Life insurance costs can vary widely based on multiple factors. As you comparison shop for the best life insurance policy for your needs, keep these important questions and answers in mind.
Is term life cheaper than whole life?
Term life insurance comes with lower up-front premium costs, which can make it a good choice for policyholders on a budget. But whole life insurance builds cash value, which might offset the higher premiums.
How much life insurance do you need?
You can estimate your life insurance needs in multiple ways — no single method is perfect for everyone. Multiplying your current income by 10 is a popular way to calculate life insurance needs. It’s also a good idea to speak with a qualified life insurance agent who can help you understand how much coverage you may need.
Is life insurance worth it?
Life insurance is a responsible financial decision if you have dependents who will have ongoing expenses after you pass away, not to mention final expenses like a funeral. A robust insurance policy can help cover expenses your family needs to handle once you’re gone.
What factors don’t affect the cost of life insurance?
As they determine your insurance cost, life insurers won’t look into your ZIP code or driving record, which are car insurance and home insurance rating factors. Other factors affect your life insurance rate. Age, gender, and health are a few examples.
What is the DIME formula?
The DIME formula stands for “debt, income, mortgage, and education,” which adds up expenses and income replacement related to those categories. Generally, the DIME method is useful for homeowners and parents who want to calculate life insurance needs while accounting for a complex financial picture.
Sources
- Insurance Information Institute (Triple-I). "What are the principal types of life insurance?."
- American Council of Life Insurers. "What You Should Know About Buying Life Insurance."
- SelectQuote. "What You Need to Know About Life Insurance Classifications."
- Prudential. "Calculator: How much life insurance do you need?."
- National Center for Education Statistics. "Tuition costs of colleges and universities."
- Military Benefit Association. "How Much Life Insurance Do I Need?."
)
A.M. SteinbachInsurance Writer
A.M. is a Brooklyn-based writer, editor, and content marketing strategist who's worked with major brands in insurance, tech, finance, and healthcare. He also contributes to The Average Joe, a personal finance newsletter that reaches over 250,000 daily readers. Since 2019, he's written for Insurify, breaking down a diverse range of insurance topics into crisp, readable prose.
A.M. has been a contributor at Insurify since December 2022.
10+ years in insurance and personal finance content
30+ years in media, PR, and content creation
Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.
Featured in
