Average Life Insurance Rates for January 2024
Average Life Insurance Rates for January 2024, Find out how much life insurance will cost you based on your age, gender, health, and other factors. You can get life insurance from dozens of different companies and choose from a wide range of terms and amounts of coverage.
Price will definitely play a part in your choice, and it might even affect the type of protection you pick. NerdWallet looked at the average life insurance rates for men and women of different ages and health levels, across a range of coverage choices, to get a sense of those prices.
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It costs about $26 a month to get life insurance. Quotecity data shows that this is true for a 40-year-old person buying a $500,000 term life policy for 20 years, which is the most usual term length and amount sold. But rates for life insurance can be very different depending on the applicant, the insurer, and the type of coverage.
How life insurance rates are determined
Life insurance rates are mostly based on how long you expect to live. Insurance rates tend to go down as you get younger and healthy.
Insurance companies usually put people into groups called “super preferred,” “preferred,” and “standard.” The “super preferred” group is the healthiest. Then, insurers figure out your rates based on your risk class.
Life insurance screening is the process by which each insurer decides who gets coverage and how much to pay. That’s why getting quotes from more than one insurance company is a good idea.
When setting your rate, these are the important things insurers look at:
How old you are. Life insurance costs less for younger people in general. This is because your life expectancy drops with age, which also means that your insurance company is more likely to have to pay out on your policy. The longer you wait, the more your rates will go up just because of your age, which is why you should buy life insurance as soon as you can.
Who you are. Most of the time, women will pay less than men of the same age and health because they live longer. The latest numbers from the Centers for Disease Control and Prevention [1] show that women can expect to live 79.9 years and men can expect to live 74.2 years.
How often you smoke. It usually costs more for smokers to get life insurance because they are more likely to get health problems like lung diseases.
Your well-being. This includes any health problems you already had, as well as your cholesterol and blood pressure numbers. They will also look at how tall and heavy you are.
The medical background of your family. If there is a history of heart disease, cancer, or diabetes in your family, your insurance company may ask you about it.
Your record as a driver. Your insurance company may see you as a high-risk life insurance applicant and charge you higher rates if you have a history of DUIs, DWIs, or big traffic violations.
Your job and the way you live. You can expect to make more money if you work in a dangerous or high-risk job, like as a police officer on the bomb squad or even as a race car driver. In the same way, you might have to pay more for insurance if you do dangerous things like flying.
Term life insurance is the cheapest because it only covers you for a certain number of years and doesn’t build real value.
Permanent life insurance usually lasts a person’s whole life and comes with a cash value feature that lets you borrow against the policy or take money out later in life. Permanent policies cost a lot more than term life policies because they have cash value and may cover you for a longer length of time.
Lastly, your rate may go up if you add life insurance riders to your policy. For instance, Quotacy says that a child rider worth $10,000 can cost an extra $50 to $75 per year.
What doesn’t impact your life insurance premium
What race, ethnicity, and sexual preference you are. Insurance companies look at your age and gender, but they can’t treat you differently because of these things.
How good your credit is. Your credit score won’t change the amount of money you pay for life insurance, but the company will look at your credit records from the last seven years. If you’ve filed for bankruptcy before, you may be seen as having a higher risk of dying, which could make your rates go up or down.
How married you are. Life insurers don’t charge different rates for married applicants like many car insurers do. How many pieces of life insurance you have. Just keep in mind that you need to have a good reason for buying a lot of coverage across various policies.
The number of people you name as recipients. Your rate won’t change if you have one or five people who will get your life insurance money.