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LIFE Insurance
LIFE INSURANCE INSIGHTS

The most affordable life insurance option is term life insurance, which is available for less than $10 a month for $100,000 in coverage.

If buying life insurance has been on your mind but the cost worries you, you’re not alone. The good news is that finding affordable life insurance is possible for just about every budget. 

How much you pay for life insurance depends on a few factors, including whether you choose term or permanent coverage, but the key to getting an affordable life insurance rate is to apply when you are young and in good health. That said, with a little effort you can find a cheap life insurance rate at any age.

Read on to learn how to find the most affordable life insurance policy, compare life insurance companies, and get tips for finding cheap life insurance.

KEY TAKEAWAYS
  • Term life insurance is usually the most affordable option, starting at less than $10 a month for $100,000 in coverage according to a 2022 Insurance.com analysis.
  • Factors that affect life insurance rates include age, gender, health history, and lifestyle habits.
  • Comparing multiple life insurance companies will help you to find the cheapest life insurance.

What is the most affordable life insurance option?

For most people, the cheapest life insurance is term life. That’s because a term life insurance policy covers you only for a specified period of time, rather than for your entire life, reducing the risk that the company will need to pay a claim.

According to a 2022 Insurance.com analysis, a 10-year, $100,000 term life insurance policy is available for less than $10 a month.

Term life insurance is designed to provide affordable protection when you need it most, such as during the years when you have children at home, and then end when you no longer need it. Different term lengths and coverage amounts allow you to find the right policy and price for your budget and needs.

Dr. Siwei Gao, professor of risk management and insurance at Eastern Kentucky University, says: “Term life insurance would be most suitable for a tight budget. It provides the basic protection against premature death without the saving features. It is most attractive to young parents who have dependents and are at the beginning of their careers.”

It’s possible to get affordable whole life insurance as well, but to get a good rate it’s even more vital to buy when you’re young. Even then, you'll usually get more coverage for your money with a term life policy, according to the Insurance Information Institute.

The best companies for affordable life insurance

On top of the underwriting factors listed above, one of the biggest keys to finding affordable life insurance is comparing multiple companies. While all companies use the same factors, they don’t all weigh them the same way. That means one company might offer a much lower life insurance quote than another.

So which companies offer the most affordable life insurance? Take a look at some average life insurance rates by company below. 

Monthly life insurance rates by company for 30-year old male vs. female, 10-year term, $100,000 death benefit

CompanyMale, 30 years oldCompanyFemale, 30 years old
Minnesota Life Insurance Company$7.37Banner Life Insurance Company$6.97
Ohio National Life Assurance Corporation$7.44Transamerica Life Insurance Company$6.97
Protective Life Insurance Company$7.46Minnesota Life Insurance Company$7.04
Banner Life Insurance Company$7.80Symetra Life Insurance Company$7.10
Symetra Life Insurance Company$7.80Protective Life Insurance Company$7.19
Thrivent Financial for Lutherans$8.26Ohio National Life Assurance Corporation$7.27
Transamerica Life Insurance Company$8.33Transamerica Life Insurance Company$7.48
Pacific Life Insurance Company$8.39Assurity Life Insurance Company$7.57
Savings Bank Mutual Life Ins Co of MA$8.74Savings Bank Mutual Life Ins Co of MA$7.58
Ameritas Life Insurance Corp$8.81Pacific Life Insurance Company$7.71
Security Mutual Life Insurance Co of NY$8.82American General Life Insurance Company$7.8
American General Life Insurance Company$8.92Lincoln National Life Insurance Company$7.82

Monthly life insurance rates by company for 50-year old male vs. female, 10-year term, $100,000 death benefit

CompanyMale, 50 years oldCompanyFemale, 50 years old
Ohio National Life Assurance Corporation$14.10Minnesota Life Insurance Company$12.65
Protective Life Insurance Company$14.22Ohio National Life Assurance Corporation$12.72
Banner Life Insurance Company$14.23Protective Life Insurance Company$12.92
Symetra Life Insurance Company$14.54Banner Life Insurance Company$12.93
Minnesota Life Insurance Company$14.74Symetra Life Insurance Company$13.06
Foresters Financial$15.32Independent Order of Foresters$13.13
Transamerica Life Insurance Company$15.47Security Mutual Life Insurance Co of NY$13.41
Thrivent Financial for Lutherans$15.65Transamerica Life Insurance Company$13.60
Pacific Life Insurance Company$15.80American General Life Insurance Company$13.68
American General Life Insurance Company$15.81Pacific Life Insurance Company$13.68
Savings Bank Mutual Life Ins Co of MA$16.01Ameritas Life Insurance Corp$14.02
Ameritas Life Insurance Corp$16.19Thrivent Financial for Lutherans$14.02

As you can see, the cheapest life insurance company for a male at either age is different from the cheapest option for a female. Of course, your rates will vary based on personal factors and will go up with age.

You can still get affordable life insurance over 50, and term life remains a cheap option. However, as you age, you will eventually find that you don’t qualify for standard term life. Affordable life insurance for seniors over 65 is harder to find, although there are companies that cater to the senior market.

Why life insurance is worth the cost

If your budget is tight, it can be hard to justify fitting in a monthly premium payment for life insurance. But if you have people who depend on your income, or who would be left in debt if something happened to you, a small monthly life insurance payment can help secure their financial future.

A young couple with children, for example, have a lot of financial obligations to worry about. Providing for those children if the worst should happen isn’t easily accomplished through investments or savings at that stage of life. “Life insurance is invaluable for everyone who has dependents,” Dr. Gao says.

How to find the cheapest life insurance policy

The first step to finding affordable life insurance is to figure out how much life insurance you need. There are a number of ways to calculate that amount. The easiest way is to use a life insurance calculator, but you can also do the math yourself. Here are two easy ways:

  • Multiply your annual income times 10, then add $100,000 for each child that will need to go to college.
  • Employe the DIME (debt, income, mortgage, and education) method. How much debt do you have, what is your annual income and how long will it be needed, how much do you owe on your mortgage, and what do you need for the education of your children?

Once you know how much coverage you need, consider how long you’ll need it. This is different for everyone but can be the number of years left on your mortgage, or the years until your kids are independent. This will tell you the term length you need.

With the term length and coverage amount in mind, you can start gathering and comparing quotes to find the best price. So how can you make sure you get the most affordable life insurance plan? Consider these points:

  • Buy term life. Term life insurance is the most affordable option for young adults, but it’s also cheaper for almost everyone.
  • Buy when you’re young. Waiting to buy life insurance will only ensure you pay higher premiums.
  • Get the correct amount of coverage. When you’re going through the steps above to select a coverage amount, make sure you look into the future and account for any foreseeable needs in addition to the coverage you need right now. It’s cheaper to buy more coverage now than to try to add coverage later.
  • Speak with an independent agent. An agent can help you with the math and can also provide you with information about various companies.
  • Get multiple quotes. It’s easy to get free quotes online, so compare as many companies as you can to find the most affordable life insurance plans.
  • Check company reviews and ratings. As you’re looking at those affordable life insurance quotes, make sure they’re coming from solid companies. Check up on each company’s reputation before you buy.
  • Choose the best company for your needs. You may want a company that lets you buy online or want a company that lets you add a rider you think you need. Narrow down your choices by your particular needs.

Factors that affect the cost of life insurance

Life insurance rates are calculated based on the risk that the insurance company will have to pay out. Essentially, they’re based on your life expectancy. Life insurance companies will calculate that using:

  • Age
  • Gender
  • Health history
  • Lifestyle risks like smoking or alcohol use
  • Occupation and hobbies

You will usually need to complete a medical exam, including a blood test, as part of the application process. While there are affordable life insurance policies with no medical exam out there, if you’re healthy you’ll find you get lower life insurance rates if you go through the full underwriting process, including the exam.

Finally, the amount of coverage you choose and the type of policy will also have an impact on rates.

How to lower the cost of your life insurance policy

If you’re still having trouble finding a really affordable life insurance policy, there are a few ways you can get that rate down. They may take some effort on your part, however.

Unlike home and auto insurance, there isn’t much in the way of life insurance discounts. The best way to lower the cost of life insurance is to improve your life expectancy and lower your risk level. Some of the best ways to qualify for a better rate are to:

  • Quit smoking
  • Reduce or eliminate alcohol
  • Lose weight
  • Give up dangerous hobbies
  • Change your diet to reduce cholesterol and improve heart health

And, of course, you can save on life insurance by shopping around to compare rates from several companies.

Frequently asked questions: Affordable life insurance

What is the average monthly cost of life insurance?

Life insurance rates vary widely depending on the type of policy, the coverage amount, and the age, gender, and health history of the insured person. That makes it really hard to define the average monthly cost of life insurance.

However, the average cost of a 10-year term life insurance policy with $100,000 in coverage is $14 a month for a healthy 30-year-old male and $10 for a healthy 30-year-old female according to a 2022 Insurance.com analysis. These low rates will generally be with full underwriting. It’s possible to get affordable life insurance without a medical exam, but it will likely cost more.

What is the cheapest type of life insurance?

Term life insurance is the cheapest option for most people, and can be purchased for less than $10 a month if you’re young and healthy.

What is the most affordable life insurance policy for young adults?

A term life policy is the most affordable choice for young adults. While you’re young you can lock in a low rate and get more coverage for your money. That said, if you are young and healthy you can also get low rates on permanent coverage if you want something that won’t expire.

What is the most affordable life insurance policy for seniors?

Many seniors will have difficulty qualifying for life insurance or finding an affordable rate. It becomes increasingly harder to find affordable life insurance for seniors over 70. “Life insurance is expensive for seniors due to the mortality risk,” says Dr. Gao, “They don't have dependents who need to be taken care of at this age. They also have a certain amount of asset build-up at this age.”

However, there are options. Final expense policies with a lower face value designed mainly to pay for funeral and related expenses are available at affordable rates for seniors.

Methodology

Insurance.com analyzed rates provided by Compulife from multiple life insurance companies for a 30-year-old male and female, as well as a 50-year old male and female, based on $100,000 and a 10-year-term policy. Rates were quoted in California for a non-smoker in the Preferred Plus health category. Average rates are the median rate across all companies quoted.