The Life Insurance Guide for 2024

Last updated Mar 29, 2024

Are you looking for life insurance? The average life insurance premium in the US is around $631 per year. Life insurance premiums are generally affordable and offer financial protection to those whose friends, family, or businesses rely on them.

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To drive a car, you must have auto insurance. To rent an apartment, you must have renters insurance. And, to own a home, homeowner insurance is a must. But life insurance is NOT a requirement for living. Because of this, life insurance is lower on the list of priorities when considering expenses.

Since many employers provide a basic life policy for their workers, many people may not need additional life insurance. But if you have dependents, then life insurance becomes a high priority. Read on for a step-by-step guide on how to choose the best life insurance.

What is Life Insurance?

Life insurance is a policy agreement between yourself and the insurer. The insurer will pay your designated beneficiary a sum (known as the death benefit) upon death. Your survivors can use the death benefit to cover your funeral, pay the mortgage or rent, or fund your children's education.

You pay for this policy via a premium at regular intervals. The amount of your premium depends on your age, health status, policy type, and the coverage you choose. If you have a non-working spouse or partner, children, outstanding debt, or a disabled person depending on you, you need life insurance and should read on.

How much does life insurance cost?

The national average for life insurance is around $631 per year. The premium is determined by factors such as age, gender, lifestyle, medical history, etc.; below is a report of the average life insurance price in the US. You can click any state to learn more details.

State Average Annual Premium
Alabama $602
Alaska $655
Arizona $615
Arkansas $584
California $668
Colorado $645
Connecticut $724
Delaware $657
District of Columbia $636
Florida $627
Georgia $630
Hawaii $687
Idaho $597
Illinois $631
Indiana $593
Iowa $601
Kansas $601
Kentucky $599
Louisiana $597
Maine $641
Maryland $712
Massachusetts $718
Michigan $610
Minnesota $639
Mississippi $581
Missouri $590
Montana $601
Nebraska $603
Nevada $607
New Hampshire $708
New Jersey $732
New Mexico $588
New York $675
North Carolina $617
North Dakota $603
Ohio $599
Oklahoma $598
Oregon $627
Pennsylvania $658
Rhode Island $660
South Carolina $615
South Dakota $591
Tennessee $609
Texas $633
Utah $636
Vermont $655
Virginia $682
Washington $655
West Virginia $590
Wisconsin $607
Wyoming $601
💡Note: Click the state to view more details.

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What Kind of Life Insurance Do I Need?

Once you decide that you need life insurance, you must consider what type of policy to buy. Let's take a more detailed look at each type.

Term Life Insurance

The more affordable type of policy is a term life insurance policy, where you pay premiums for a "term" that can range from 10 to 30 years. The object of a term policy is to offer coverage only while you need it. For example, a 30-year term policy will give you coverage while your kids become adults and your savings or investments grow. When the policy ends after 30 years, you may not have any need, as your dependents have left and circumstances have changed. When the policy expires, you may have the option to extend the policy or convert the policy to a whole or permanent type of policy.

Permanent (Whole) Life Insurance

Permanent life insurance, also known as whole life insurance, extends through your natural life. This type of policy is more expensive due to its length but also because it will build cash value. Thus, your premiums go to funding your policy and building a cash reserve for future expenses, even premiums. In addition, some whole-life policies offer investments along with coverage. Still, some experts argue that insurance and investments should stay the same due to volatility in the stock market and the higher premiums of such policies.

💡No-Exam Policies
Whether you go term or permanent, avoiding no-exam-required policies is more affordable in the long run. Since the insurer will have to take an educated guess about your health in these cases, the premiums tend to run higher than a visit from a doctor for a qualifying exam. Most people under 50 can get enough coverage with term life insurance. The next question is: how much insurance do you need?

What are the steps for purchasing a life insurance policy?

  • Calculate Your Coverage

    So how much insurance do you need to buy? The answers range from 8 - 12% of your income. To narrow that range down, consider the age of your kids, the working status of your spouse, and the amount of major debt you carry. If you are 50 or older, 5- 10% of your income can be spent on life insurance, and you will want to purchase a permanent policy rather than a term. Plug this information into one of the many life insurance calculators you can find online to determine the exact and correct amount of coverage you need.

  • Get Insurance Quotes Online

    Once you know the type and amount of insurance you need, shop around online for quotes. Look for a free quoting service that can, with just a bit of your personal information, compare premium prices from major and minor insurance providers in a few seconds. Don't always jump on the cheapest quote you see. Instead, compare several quotes, looking at the price, company reputation, and customer service. You want to insure with a reputable company with a proven track record of positive, unbiased reviews and an easy claim process.

  • Apply For Your Policy

    Once you have chosen the policy you'd like to buy, you will have to go through an application process with that insurer. You may need to submit your application over the phone or online, where you will answer questions about your medical history and general lifestyle. The insurer will want to determine if your hobbies, employment, or other factors contribute to the amount of risk they must cover if they accept you for their policy. Be honest when answering application questions, as they will be verified by the insurer.

  • Get a Medical Exam

    A life insurance medical exam is like a yearly physical, except you can have the medical examiner come to your own home for the free exam.

    Your physical will include measurements like your height and weight, blood pressure, and pulse, and you’ll have to give blood and a urine sample.

    The good news is that you can use these same results on other life insurance applications for up to six months. Online life insurance providers typically have a streamlined application process that does not require a medical exam, especially if the applicant is younger and in good health.

  • Underwriting Period and Offer

    After making your application and exam, you wait for the insurer's underwriters to decide on your eligibility for their policy. It can take up to six weeks.

    If the underwriter accepts your application, they will send you a policy offer, which you should examine thoroughly. If you agree to the terms, sign the policy, and start paying your premiums via whatever system you set up with the insurer. Now you are covered, and you're all set as long as you've done your research.

Insurance For Life

Insurance that is meant to work only when you die may not be an expense you want to incur. But the peace of mind that you get from knowing that your loved ones are cared for financially is priceless. So if you want to get started, contact us online today to use our free price comparison service. We are user-friendly and will help you find the best life insurance plans!

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Our articles are intended for informational purposes and should not be considered legal or financial advice. Our articles are not written or reviewed by insurance agents. Consult your policies with your agent or a professional for details regarding terms, conditions, coverage, exclusions, products, services, and programs.

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