According to Policygenius, the life insurance industry has maintained price stability going into 2022. Most non-smokers saw small rate increases of less than 1% between December 2021 and January 2022, while smokers did not notice any changes in their monthly premiums.
Average life insurance premiums have remained flat despite the high death rate linked to the coronavirus pandemic. Death benefit payments rose 15.4% in 2020, according to the American Council of Life Insurance Companies (ACLI). However, Policygenius data indicates that consumers do not need to worry about rising life insurance premiums at this time.
Keep reading to learn more about the average cost of life insurance per month, as well as how life insurance premiums are determined. If you are considering getting a life insurance policy, visit Credible for free life insurance quotes.
Is permanent life insurance a good idea for you?
Average cost of life insurance by age and gender
Monthly life insurance premiums remained flat as the new year entered, according to PolicyGenius data, with a slight increase from December 2021 to January 2022.
Life insurance costs are lowest for young policyholders with low health risks, while rates tend to rise with the age of the policyholder. For example, it costs $25.56 per month to insure a 35-year-old woman with a 20-year life insurance policy worth $500,000. This same policy would cost $152.23 per month for a healthy 55-year-old man.
Also, average life insurance rates are much higher for smokers than for non-smokers. The policy used in the example above costs $224.46 per month for a 45-year-old man who smokes, compared to just $61.05 for a non-smoker of the same age.
Regardless of a person’s age or health rating, though, life insurance rates remained relatively stable until 2022. If you’re shopping for life insurance, you can browse policies and see monthly rates tailored to you on Credible.
Breakdown of life insurance cost by age, duration and policy size
How are life insurance premiums calculated?
The monthly cost of life insurance depends on the life expectancy of the policy holder. Life insurance companies take into account a number of factors, such as age, gender, health, medical history, and even recreational hobbies. Riskier consumers of insurance should expect to pay higher monthly premiums, while low-risk policyholders will cost less insurance.
To determine your health risks, life insurance companies may require you to undergo a medical exam. Health conditions such as high blood pressure or obesity can affect the overall cost of a life insurance policy.
Premiums also depend on the type of life insurance policy you have. Longer policy periods will have higher monthly costs, while shorter policy periods with lower coverage amounts will be cheaper.
It is usually recommended that you purchase life insurance with a coverage amount equal to 10-15 times your annual individual income, according to Policygenius. The term of the policy must be long enough to cover you at retirement age.
For example, a mother of 45 who earns $65,000 per year might want to consider a 20-year policy with a coverage amount of $1 million. That’s about 15 times her annual income, which may be necessary to take care of dependents IAnd she died unexpectedly.
On the other hand, a 35-year-old married without children who earns $50,000 a year might consider getting 30-year life insurance with $500,000 of coverage. This document is long enough to bring him to retirement age, and the amount of the death benefit may be enough to cover his wife’s expenses.
When it comes to choosing a life insurance policy, there is no one-size-fits-all approach. You will need to think about the best policy for your lifestyle and financial situation. Contact a Credible financial expert to determine your life insurance needs.
Getting life insurance as long as you are young and healthy can save you thousands
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