Term Life Insurance Rates by Age

Sometimes, a permanent life insurance policy isn’t the right fit for you. Term life insurance is a type of life insurance product that provides coverage for a set period of time. It can be more cost-effective than permanent life insurance products, provide coverage for a specific period of time, and sometimes, even supplement whole life policies.

Term life insurance policies typically end between ten and thirty years after the policy’s start date, or if the policyholder passes away before the expiration date of the policy. If your head is spinning trying to understand universal life insurance products–or any other type of permanent life insurance product–then a term life policy may be a good way to get your feet wet with coverage.

This is because these life insurance policies tend to be simple and straightforward. Term life insurance doesn’t typically include a cash value account and usually only offers a cash payout to listed beneficiaries if the insured passes away within the policy term.

Did you know not everyone pays the same life insurance rates? This is because insurance companies weigh multiple factors to determine what your monthly insurance premium will be. One of the biggest factors for term policies is age.

The younger you are, the more likely you are to receive a lower rate on your monthly insurance premiums because you represent a lower risk to life insurance companies. Younger people typically have a longer life expectancy, so your insurance provider is less concerned with paying out a death benefit when you’ve spent less time paying into the policy.

If you start your policy when you’re older, the insurance provider is more likely to see you as a higher risk, as the amount of time you have to pay into your policy is likely to be lower than someone who starts paying into it at a younger age.

Age is just one piece of the puzzle that can impact the cost of your life insurance rates. Other factors that impact cost include:

• Health: If you have preexisting health conditions–especially terminal or chronic ones–you may have higher premiums.
• Gender: Studies show that the average male has a shorter life expectancy than the average female. Because of this, male policyholders tend to pay higher coverage premiums than female policyholders.
• Occupation: What you do for work matters. If you work in a high-risk industry–such as construction or manufacturing–you may have to pay higher premiums than someone working a standard office job.
• Lifestyle: Riskier hobbies can lead to higher insurance rates. If you’re a thrill-seeker or a hobby pilot, your rates may be higher due to the higher chance of accidents.
• Tobacco use: Tobacco use is known to lower life expectancy, so whether you smoke or vape, your insurance provider may charge you a higher monthly rate.
• Family history: Similar to your health, your family’s health history can be an indicator of risk for insurers. If your family has a history of serious health conditions, you may face higher policy premiums.

Additionally, insurance companies also factor in the policy type and coverage amount you want from your term insurance. If you add a policy rider, like disability insurance, this can also increase your life insurance rates.

Yes–the older you are when you start a policy, the more expensive your insurance rates can be. Once you fall into a certain age category, insurance companies will note that you are likely a higher-risk policyholder than someone who is younger.

As we mentioned before, other factors can affect this, too. A sixty-two-year-old male with a long history of tobacco use will likely have to pay higher insurance rates for the same coverage amount than a thirty-year-old female who doesn’t smoke and is in perfect health.

Typically, it won’t. For example, if you purchase a policy at the age of thirty years old and the life insurance policy expires in thirty years from the start date, your premiums will usually remain the same for the entire length of the policy as you age.

However, this may change if you lapse on your premium payments and lose coverage, or if the policyholder chooses to change the policy coverage. To fully understand the terms of your policy, read the policy agreement carefully and ask your insurance agent any questions you might have.

Term life insurance rates by age are usually divided into five-year increments and are also usually separated by gender. Some insurers might offer rates based on specific ages, whereas others might set a certain rate for a certain age group.

Costs of policy premiums also depend on the size of your death benefit. Higher-value death benefits will inherently cost more, which is why it’s important to decide why you want a term life insurance policy at this stage of your life.

For example, young adults may typically take out a term life insurance policy to help support their business or help out with mortgage costs. Middle-aged people may choose this type of life insurance for additional resources or safety nets as they enter retirement. Seniors tend to have the hardest time purchasing this type of insurance–no matter the coverage rates.

Getting life insurance can be a deeply personal financial decision. You want coverage that protects your loved ones by providing them with a safety net after you’ve passed on. The earlier you look into life insurance resources and solutions, the higher chance you have at securing valuable savings.