How much does life insurance cost?
It’s the question everyone wants to know is: how much does life insurance cost. So this is specific, and I know it changes just slightly from state to state sometimes, but with Arizona pricing, this can give you a general idea. I’ve got some pricing here that I’ve run for term, tobacco and non tobacco, and then whole. So this isn’t every scenario. This is intended to just give you a general idea of what you can expect to pay for a life insurance policy.
So here’s something though to note before I start. In life insurance, there’s two worlds, there’s two ways of getting insurance coverage. One is non-medical, and one is medical. “Medical” means they send somebody out to do all your blood work. They take your vitals and take your weight and go back and do all of the APS reports from the doctor and all that stuff.
No agent can quote that with any degree of accuracy until after the blood work is being done. Let’s suppose you want to know how much life insurance costs. You see quotes from an advertisement that say, “Hey, you can get $500,000 for $14.95 a month.” An intriguing claim until you look at the small print.
Let’s unpack that…
How healthy are you really?
You might actually think that you’re perfectly healthy, but when you go through underwriting, they look at your health with a high degree of detail. You might not have any medication problems or any health conditions. But there may be things going on that you don’t even realize, and they can catch that in underwriting and rate your policy. It becomes more expensive.
So we’re not going into that. I’ve got a whole different video that talks about medical versus non-medical. What I’m giving you today are quotes based on non-medical policies, which seem to be more and more popular these days. People don’t like sharing all their health information with companies because it gets reported to the medical information bureau (MIB) and many people don’t realize it.
So non-medical is a really nice way to go. First, people appreciate the convenience. However, I will tell you, if you’re in really good health, and your blood work checks out, you can potentially get better rates going fully underwritten and getting a full medical. These prices could be less if you’re in really good health. But, since we don’t know we’re not going to go there in this article because those are called guesstimates. We don’t know exactly what the pricing is going to be. Non medical pricing is exact, as long as you’re approved.
Let’s look at a 20 year term for $100,000
That’s just a starting point. If you’re 25, I’ve got carriers that’ll do that anywhere from $17 to $21 a month. $100,000, 25 year old, non-tobacco, that’s a 20 year term. If you’re 40, expect to pay anywhere from $30 to $40 a month.
By the way, the reason why I’m giving you a whole bunch of them is because I work with a lot of carriers and I run pricing, and compare it. I’m kind of a geek like that, so that I can always know where to go to get the best pricing where I can when I’m talking to my clients.
Age affects the pricing on our policies more than anything. So, the best time to get life insurance is today because today’s the youngest you’ll ever be. This is one product that’s always going to go up in price, always. It’s never not going to go up in price, so don’t wait thinking you can get a better rate next year. For a 50-year-old, best price I’ve got is about $60 to $65, potentially one here that’s $42, but more likely around $60-$70 per month.
By the way, pricing for life insurance is like shopping around for gas. You’re going to see that they’re all within about $7 or $8 of each other. And at some point, it doesn’t make sense to drive 45 minutes to save 3 cents on the gallon, right? It really comes down to working with the right agent. Fins someone who will take good care of you, shop around and who works with a-rated companies. The pricing is always comparable because the carriers follow a similar set of underwriting criteria.
What if I’m 60+?
A 60-year-old through one of my carriers here could get a $100,000 policy for 20 years in the $150 to $180 range. You can see the spread increases as you age. Now, on a term policy, you can get coverage all the way up to about 75, but it stops making sense. These policies can get real expensive. A 65 year old, your term coverage for $100,000 is going to be well over $200.
What if I’m a smoker?
Now let’s go to tobacco rates. How much does life insurance cost for a smoker? This is one of the questions that your agent will ask you, and here’s why: the rates pretty much double in a lot of cases, especially as you age.
30 year old: if you smoke and you wanted a 20 year term for $100,000, you’re looking at anywhere from $37-$48 per month. 40 year old can expect to pay $67-$77 right now for the same coverage. Let’s jump up to a 60 year old: $318-$381 per month. If you smoke and you’re in your sixties or so, term is not a good idea. My advice is to back off the size of the death benefit and just get a whole life.
What about a whole life policy?
So let’s go to whole life. Those are some actual numbers from actual carriers based in Arizona. Same criteria: $100,000, 20 years, male. By the way, I didn’t run female quotes, which are less expensive than for males. Whole life is permanent coverage. I’m just looking at something small, just $15,000 to show you what that would look like and how that increases over the years.
How much does life insurance cost for a permanent policy? Here’s pricing for a non tobacco, male, non-medical, whole life policy for $15,000? This would be considered a final expense policy. It’s designed to cover any final expenses you might have, like funeral costs and things.
If you’re 55 years old, I could get that policy for around $50 per month.For someone who is 60 years old, you’re looking at about $60-$65. At age 70, it jumps up to $106-$153 per month, depending on the carrier. If you’re 80 years old, yes, you can still get coverage, but it’s not going to be cheap. So the same 15,000 now would be in a range of $197-$218.
When I reach out to people, I’m not trying to pressure them or sweet talk them into a policy. I need enough information so I can do my job. There’s a lot of numbers on here. And if I don’t have enough information, I have to guess, which is going to put you in a compromised position if I’m wrong.
Hopefully this gives you an idea of cost because I know some people like to know, how much would it cost if I had $100,000, $500,000 or $2 million. Of course all those are different factors that are going to affect your monthly premium.
What about riders?
Your monthly premium depends on the length of coverage you’re getting and the amount of coverage you’re getting. After that, there are a host of riders (or enhancements), such as the living benefits, the chronic, critical, and terminal illness rider, accidental death, waiver of premium and a child’s term rider. They all influence your monthly premium.
Last thing, these also factor in that you would pass the height and weight chart. One of the first things we look at in underwriting is your build. And we have different carriers for all those products. So if you’re heavier, I’ve got different carriers I use that have friendlier underwriting toward those situations.
So how much does life insurance cost?
As you can see, it’s not a quick, easy question to answer. If you found something that sounded in range and you’d like to finish off the quote based on your specific criteria, we should just talk. Hopefully you can see why you need to talk to an agent. Online calculators are okay and they’ll get you so far. But a good agent, someone with your best interest at heart, will do their due diligence. A good agent will shop around and find the best tool to get the job done for your specific situation. No amount of automation can replace that.