Term Life Insurance Cost Factors
Term life insurance costs are based on:
- Coverage amount and level period
- Your gender (men have higher premiums)
- your age and health
- Family medical history (emphasis on death of parents and siblings before age 60 or 65 or diagnosis of specific problems)
- Do you smoke or use other nicotine products
- Whether you smoke marijuana or not
- Other risk factors, such as your motor vehicle record and dangerous hobbies, such as scuba diving
How much term life insurance do you need?
Calculate how much life insurance you need using the following factors:
- Outstanding Debts. Consider the financial obligations you want your life insurance beneficiary to be able to pay, such as mortgages, car loans and credit card debt.
- Replace your income. Life insurance benefits can replace your income that stopped due to death. Think about how many years of income you want to replace, taking into account inflation and expected income growth over time.
- Future needs, such as college tuition. Do you also want term life insurance to cover major future expenses? For example, do you want your family to have money to pay for college?
- Funeral expenses. Include final costs in your calculations.
After you add up these expenses, subtract funds your family could use from other sources, such as savings or other life insurance policies.
There are free online life insurance calculators that can help you determine the right amount of coverage, or work with a financial advisor to help you figure out the best life insurance options within your larger financial goals.
How to find the best term life insurance
Cost is one of the important factors to consider when looking for the best term life insurance, but policy features are just as important as billing.
Check the maximum renewal age
The best term life insurance policies are renewable at the end of the horizontal term. Although renewal rates are very high, having the flexibility to continue coverage in the event that you are unable to purchase a new policy is a smart strategy.
Check periodic life conversion rules
Check the deadlines for converting your term life insurance policy to permanent life insurance, such as universal life insurance. If you decide you need permanent life insurance in the future, converting your existing term life insurance policy is a convenient option. Some life insurance companies limit conversion windows, reducing your future flexibility.
Ask questions about exam-free coverage
An increasing number of life insurance companies are offering term life insurance without a life insurance medical exam. Your health still affects life insurance quotes, but life insurance companies use other data sources to gather information about your health and other factors.
Check living benefits
Living benefits in life insurance can provide you with future financial options if you suffer a serious illness. They allow you to withdraw funds from your death benefit when you may have high expenses. Most term life insurance companies offer an accelerated death benefit rider for terminal illness, but some also offer riders if you have a chronic or critical illness.
Check out other life insurance riders
In some cases, purchasing additional life insurance riders may be a wise choice for future financial security. For example, a premium waiver rider allows you to stop paying premiums if you become totally disabled.
Work with an experienced agent
An experienced life insurance agent will know which companies are likely to give you the best quotes based on your age, health and other factors. Rather than trying to navigate the world of life insurance on your own, it’s better to enlist the assistance of a good agent.
How to get term life insurance
Once you choose the best term life insurance policy, getting life insurance is relatively simple.
- Fill out the insurance application form. You’ll typically answer questions about your health, your family’s health history, and other risk factors. The insurance company will provide a preliminary quote.
- Take a life insurance physical exam Although many insurance companies offer no-test life insurance if needed.
- Get a final quote. Once the underwriting process is complete, you will receive a final life insurance quote.
- Purchase a policy and pay your first premium. Determine whether you will pay your premium monthly, quarterly, or annually, and whether the fees will be automatically debited from your bank account or credit card, or if they will send you a bill.
Term Life Insurance News
The latest data from industry research organization Limra shows that term life insurance policy sales increased by 6% compared with the same period last year. Growth is attributed to factors transforming the life insurance landscape, including automated underwriting, online distribution and more competitive pricing.
Based on sales in the first quarter of 2026, these companies top the list in terms of total premiums and total number of policies: