10-Year Term Life Insurance Policy: How Much Will a Policy Cost and Is It Right for You?

Buying a 10-year term life insurance policy will financially protect your loved ones. MoneyGeek analyzed 10-year term life policy rates across the largest life insurance providers to help you find a policy that can fit in your budget.

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Last Updated: 9/21/2022
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Life insurance provides excellent peace of mind and protection for the policyholder’s loved ones when the insured passes away. It involves the payment of premiums in exchange for a tax-free lump sum paid to the beneficiaries after the insured’s death. There are two main types of life insurance: term and whole. A term life insurance policy is only in effect for a pre-determined period. MoneyGeek breaks down 10-year term life insurance policy rates to help you find the best policy that suits your needs.

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What Is a 10-Year Term Life Policy?

Term life insurance comes with various lengths. Most insurance providers offer terms ranging from 10–30 years. Among these, the 10-year policy is usually the most affordable and basic option.

A 10-year term life insurance policy provides guaranteed insurance for a decade. During this time, the insured’s premium remains the same. After 10 years, the policy expires. That means you will no longer have coverage.

The death benefit coverage of the policy also only lasts until the end of the term. For example, if the insured dies within the 10-year term, their designated beneficiary will get a lump-sum payment as stated in the policy. This amount is often tax-free.

There are also other situations where a 10-year term life policy can help. For instance, couples financing a home can use it to cover mortgage payments or even pay it off entirely if one of them passes away unexpectedly.

Young families can use a 10-year term policy to pay for credit cards, daycare, loans and living expenses. It can also be used for financial milestones, including tuition and wedding expenses.

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Ensure you’re getting the best rate for your life insurance. Compare quotes from top providers to find the most affordable life insurance coverage for your needs.

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Is a 10-Year Term Life Policy Right for You?

Choosing a 10-year term life insurance policy gives your loved ones a source to cover specific financial needs if you pass away within the term. It is often bought by individuals looking for coverage for a temporary financial risk, such as a mortgage, business or short-term loan. It is also an ideal option for those who want a more affordable policy while preparing for a policy with permanent coverage in the future, like whole life or universal life insurance.


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PROS

  • Affordable premium
  • Guaranteed rates during the term
  • Flexible (can be renewed or converted)
  • Can be used as collateral for personal loans
  • Tax-free death benefits
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CONS

  • Premiums based on age
  • No cash value
  • Short-term coverage

How Much Does a 10-Year Term Life Policy Cost?

Generally, 10-year term life insurance rates vary based on different factors. The average cost of 10-year term life policies for a 30-year-old non-smoker male with $500,000 coverage is between $13.33 and $27.74. For smokers, the average premium for a similar policy is approximately $49.88 to $105.88. Typically, those in poor health have more expensive premiums. For a similar policy and profile, the average cost, if you have poor health, is between $16.13 and $43.30. Compare quotes from multiple insurance providers to find the best policy and price.

What Factors Impact Your 10-Year Policy Cost?

Various factors can affect your 10-year term life insurance cost. Understanding these factors can help you choose the best life insurance policy for your needs.

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    Age

    Typically, younger individuals get lower premium prices compared to older adults.

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    Health History

    Those with a history of certain health problems may have more expensive rates.

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    Current Health

    Most insurers, if not all, require a medical exam for applicants who want to purchase a term life insurance policy. The results of the tests can affect the cost of your insurance.

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    Body Mass Index (BMI)

    BMI scores categorize people into weight classes. Obese people tend to be at higher risk for various medical conditions, so they pay higher premiums.

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    Smoking

    Smokers are considered to have higher risks for various illnesses. So, they often have more expensive premiums than non-smokers.

10-Year Policy Costs by Coverage Amount & Age of Buyer

Your age can highly affect the cost of your insurance. Premium rates rise with age due to decreasing life expectancy. Check the table below to see how prices change depending on age.

10-Year Term Life Cost by Coverage & Age

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  • Policyholder Age
    $250,000
    $500,000
    $1,000,000
  • 30-Year-Old
    $14.75
    $18.44
    $32.05
  • 40-Year-Old
    $18.72
    $24.80
    $45.21
  • 50-Year-Old
    $36.67
    $55.28
    $99.51

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10-Year Policy Costs if You Smoke or Are in Poor Health

Insurance companies have health rating classifications to help determine rates. Having a healthier lifestyle also helps you get lower premiums. Smokers have higher rates because of the various health risks of smoking. Individuals with generally poor health also get higher premium costs.

10-Year/$500,000 Term Life Cost for Smokers or People in Poor Health

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  • Policyholder Age
    Smoker
    Poor Health
    High BMI
  • 30-Year-Old
    $62.99
    $29.26
    $26.88
  • 40-Year-Old
    $94.32
    $41.03
    $36.87
  • 50-Year-Old
    $214.20
    $88.36
    $77.36

Which Companies Have the Lowest 10-Year Term Rates?

MoneyGeek analyzed average rates from various insurers to help you find the best life insurance companies for a 10-year term policy. Transamerica offers the lowest prices for various coverage levels. It has an average monthly rate of $9.68 for $250,000 in coverage, $13.33 for $500,000 and $18.92 for $1 million. The table below shows how prices compare among insurance companies.

10-Year Term Cost by Company & Coverage

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  • Company
    $250,000
    $500,000
    $1,000,000
  • 1.
    Transamerica
    $9.68
    $13.33
    $18.92
  • 2.
    Mass Mutual
    $11.10
    $15.60
    $23.93
  • 3.
    Nationwide
    $11.81
    $15.75
    $23.19
  • 4.
    Mutual of Omaha
    $12.04
    $16.13
    $26.85
  • 5.
    AAA
    $13.42
    $18.48
    $29.92
  • 6.
    Progressive
    $16.10
    $23.49
    $63.95
  • 7.
    State Farm
    $17.62
    $24.34
    $35.69
  • 8.
    Prudential
    $29.41
    $27.74
    $53.98

Average rates for smokers are higher than those of non-smokers. Based on MoneyGeek’s analysis, Transamerica typically offers the cheapest options for individuals who smoke. The cost of a Transamerica policy averages $29.03 for $250,000 in coverage, $49.88 for $500,000 and $85.14 for $1 million.

10-Year Term Cost by Company for Smokers

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  • Company
    $250,000
    $500,000
    $1,000,000
  • 1.
    Transamerica
    $29.03
    $49.88
    $85.14
  • 2.
    Mass Mutual
    $33.50
    $60.04
    $98.75
  • 3.
    Progressive
    $36.54
    $63.95
    $149.21
  • 4.
    State Farm
    $36.97
    $62.64
    $106.99
  • 5.
    Nationwide
    $38.28
    $105.88
    $192.06
  • 6.
    Mutual of Omaha
    $39.78
    $72.46
    $139.40
  • 7.
    AAA
    $40.26
    $74.36
    $124.96
  • 8.
    Prudential
    $51.69
    $78.14
    $154.77

Insurance companies charge more to people in poor health because they're at an increased risk of early death. If you have a poor health profile, your cheapest option is probably Mutual of Omaha. Its average rates per month are $12.04 for $250,000 in coverage, $16.13 for $500,000 and $26.85 for $1 million coverage.

10-Year Term Cost by Company for Those in Poor Health

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  • Company
    $250,000
    $500,000
    $1,000,000
  • 1.
    Mutual of Omaha
    $12.04
    $16.13
    $26.85
  • 2.
    Transamerica
    $15.05
    $23.22
    $36.98
  • 3.
    Mass Mutual
    $18.71
    $30.46
    $51.77
  • 4.
    Nationwide
    $20.78
    $30.19
    $51.19
  • 5.
    AAA
    $21.34
    $36.08
    $65.12
  • 6.
    Progressive
    $24.36
    $39.59
    $63.95
  • 7.
    State Farm
    $25.44
    $36.99
    $58.29
  • 8.
    Prudential
    $25.61
    $43.30
    $78.14

Older adults tend to have higher premium rates as well. However, various insurance companies set their rates differently. The cheapest life insurance option for older buyers is Transamerica. A policy with $250,000 coverage from Transamerica typically costs $24.51 per month. Meanwhile, $500,000 coverage costs an average of $43. If you want $1 million in coverage, Transamerica’s average rate is $71.38.

10-Year Term Cost by Company for 50-Year-Old Buyers

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  • Company
    $250,000
    $500,000
    $1,000,000
  • 1.
    Mutual of Omaha
    $29.03
    $51.39
    $97.30
  • 2.
    Nationwide
    $29.09
    $49.44
    $87.06
  • 3.
    Mass Mutual
    $29.80
    $52.64
    $94.40
  • 4.
    State Farm
    $35.89
    $55.69
    $100.89
  • 5.
    AAA
    $37.40
    $64.24
    $107.36
  • 6.
    Progressive
    $63.29
    $113.10
    $207.50
  • 7.
    Prudential
    $72.51
    $56.06
    $110.62

Compare Life Insurance Rates

Ensure you’re getting the best rate for your life insurance. Compare quotes from top providers to find the most affordable life insurance coverage for your needs.

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Insurance Rates

What Happens After the 10-Year Term?

After 10 years, a 10-year term life insurance policy expires. That means you will no longer have coverage.

Some people choose not to get life insurance once their term ends. That may be the case for those with adult children who are financially independent, or if the policyholder already has enough assets to take care of their loved ones.

However, that may not be the case for everyone. If you want your beneficiaries to have financial protection after your term ends, you can extend or convert your coverage. You can also opt to buy a new policy.

Check if your policy has a specific clause that allows renewal. In some cases, it is possible to renew annually up to age 95. With this, you may no longer need to undergo a new physical exam. However, your premiums may become more expensive each year.

Most insurance providers include a provision for conversion to a permanent policy. If you choose this, you will have coverage for the rest of your life. Additionally, your premium will be fixed.

Another option is for you to buy a different policy. Make sure you consider your situation when choosing the best coverage.

Frequently Asked Questions About 10-Year Term Life

Understanding 10-year term life insurance can help you search for the best policy. Knowing the answers to some of the commonly asked questions about this form of coverage can help you in your search.

About the Author


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Mark Fitzpatrick is a senior content manager with MoneyGeek specializing in insurance. Mark has years of experience analyzing the insurance market and creating original research and content. He graduated from Boston College with a Bachelor of Arts and Johns Hopkins University with a Master of Arts.