Updated: May 22, 2024
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Life insurance policies come in a variety of terms and amounts. One of the most common and affordable life insurance coverage amounts that most insurers offer is $100,000. However, as with any other insurance product, some $100,000 insurance policies and providers will be more affordable or better for your needs than others.
Factors like age, gender, smoking habits and medical history can affect your life insurance premiums.
Life insurance policies can be purchased without a medical exam, but this coverage is significantly more expensive.
If you're on a tight budget or need the life insurance policy to cover temporary or specific expenses like funeral costs, a $100,000 term policy may be the best life insurance option for you.
The cost of a life insurance policy can vary depending on several factors, such as term length, age, health history and more. MoneyGeek analyzed $100,000 life insurance policies to determine the average premium for 10- and 20-year term lengths.
The average monthly cost of a $100,000 life insurance policy for a 10- or 20-year term is $11.02 and $12.59, respectively.
According to MoneyGeek's research, Transamerica is the cheapest term life insurance provider for a $100,000 policy. Its average policy cost for a healthy individual, as well as the ratings it earned from MoneyGeek and other rating agencies, are as follows:
Transamerica is the cheapest $100,000 life insurance provider, quoting around $8.60 monthly for a 20-term policy. This insurer offers term and permanent life insurance policies. The terms range from 10–30 years with five-year increments and coverage amounts ranging from $25,000 to $10 million (or more based on individual considerations).
The second-cheapest insurance company for a $100,000 life insurance policy is MassMutual. Its average premium for a healthy individual and its quality ratings from various sources are competitive.
MassMutual offers the second-cheapest $100,000 life insurance policy, charging $10.10 per month on average for a 20-year term policy. It offers both 10- and 20-year term life insurance plans. Additionally, the company provides permanent life insurance policies.
Term life insurance is purchased for a specific length of time, usually between 10 and 30 years. Renewable life insurance policies can be extended for an additional term or until the policyholder reaches a particular age.
Transamerica's $100,000 term life insurance policies are the cheapest among the companies MoneyGeek evaluated for 10-, 15-, 20- and 30-year terms. Prudential typically has the most expensive $100,000 term life insurance rates of all insurers across the terms we assessed.
The following are the average monthly premiums for a $100,000 life insurance policy from the various insurers for the most common term lengths:
Company | 10-Year Term | 15-Year Term | 20-Year Term | 30-Year Term | |
|---|---|---|---|---|---|
1. | Transamerica | $7.05 | $8.53 | $8.60 | $14.53 |
2. | Mass Mutual | $8.88 | $10.74 | $10.10 | $17.07 |
3. | Mutual of Omaha | $9.94 | $12.03 | $11.48 | $19.40 |
4. | AAA | $9.64 | $11.66 | $11.75 | $19.85 |
5. | Nationwide | $11.42 | $13.82 | $12.38 | $20.92 |
6. | State Farm | $12.51 | $15.14 | $12.88 | $21.76 |
7. | Progressive life | $12.79 | $15.47 | $15.45 | $26.10 |
8. | Prudential | $15.96 | $19.31 | $18.12 | $30.62 |
As you grow older, the risk that an insurer will be required to pay out on your insurance increases, and as a result, premiums rise. People usually buy life insurance for the first time around age 40.
The average monthly premium for a $100,000 20-year life insurance policy is $12.59 for a 30-year-old policyholder and $68.31 for a 60-year-old policyholder — a difference of $55.72. However, the monthly premiums for a $100,000 10-year life insurance policy average $11.02 for a 30-year-old policyholder and $42.15 for a 60-year-old policyholder. In other words, the longer the term, the more significant the difference in price between age groups.
The table below displays the average monthly cost of a $100,000 life insurance policy by age and term length.
Age | 10-Year Term Average Cost | 15-Year Term Average Cost | 20-Year Term Average Cost | 30-Year Term Average Cost |
|---|---|---|---|---|
30 | $11.02 | $13.34 | $12.59 | $21.28 |
40 | $13.77 | $16.67 | $16.93 | $28.61 |
50 | $22.42 | $27.13 | $31.41 | $53.09 |
60 | $42.15 | $51.00 | $68.31 | $115.44 |
70 | $112.69 | $136.35 | Not available | Not available |
Individuals with a poor health history are considered more likely to file an insurance claim, and insurers classify them as high-risk policyholders. A history of serious illnesses like heart disease or cancer will almost certainly increase your premiums. Additionally, smoking puts you at risk for various health problems and raises your rates. Even the cheapest life insurance policies for smokers can be much more expensive.
For example, smokers pay an average of $27.85 per month for a 10-year, $100,000 life insurance policy, while those in poor health pay $15.41 per month for the same level of coverage. An average healthy policyholder would pay approximately $11.02 for comparable coverage. Smokers spend nearly $37.90 per month for a 20-year policy, while those in poor health pay roughly $19.80 per month. The monthly premium for the same term is around $12.59 for a healthy policyholder.
The table below details the average monthly rates of a $100,000 life insurance policy for smokers, individuals in poor health and those with a high body mass index (BMI).
Criteria | 10-Year Term Average Cost | 15-Year Term Average Cost | 20-Year Term Average Cost | 30-Year Term Average Cost |
|---|---|---|---|---|
Smoke | $27.85 | $33.70 | $37.90 | $64.05 |
Poor Health | $15.41 | $18.65 | $19.80 | $33.46 |
High BMI | $14.29 | $17.30 | $18.33 | $30.98 |
If you buy a $100,000 life insurance policy and your beneficiaries claim it after your death, they will get $100,000. You have a say in how your death benefit will be distributed if you pass away. Most insurance policies still offer the option of a lump sum as the default payout option.
Some policies have an installment payment option in which the cash and accrued interest are paid out regularly over the beneficiary's life. Certain insurers provide checkbooks to recipients of large insurance policies instead of lump-sum or installment payouts.
Note that a $100,000 life insurance policy typically makes sense only if you are financially stable, have no ongoing financial obligations, have minimal liabilities or are debt-free.
Permanent life insurance is a term used to refer to policies that never expire, no matter when the insured passes. Whole life and universal life are the two most common types of permanent life insurance that insurance companies offer. They might be up to 20 times more expensive than term life insurance. One of the most popular types of whole life insurance is guaranteed issue, which doesn't require you to take a medical exam, answer health questions or give the insurer access to your medical and prescription data.
Whole life insurance offers permanent death benefit coverage using fixed premiums for the insured's whole life. In addition, it comprises a savings component known as cash value, on which interest may accrue. You can receive this interest in the form of payouts or dividends. On the other hand, universal life insurance provides both a death benefit and investment savings by paying flexible premiums or a minimum amount to retain the policy.
30-Year-Old Male
$15930-Year-Old Male
$1,242This is 681% more expensive.
Unlike a traditional life insurance policy, for which it can take weeks to get approved, instant life insurance doesn't require a medical exam, and it's fast and convenient to apply for. It is only available to people in specific age groups who meet certain health criteria. Regardless, a $100,000 instant life insurance policy costs the same as a traditional policy with the same coverage.
The primary distinction between guaranteed issue insurance and instant life insurance is that the former does not require you to undergo an exam. However, instant life insurance may require you to answer a few health-related questions. Additionally, guaranteed issue insurance can be very costly. For instant life insurance using accelerated underwriting, you may have to answer many questions, whereas with simplified issue underwriting, applicants only need to answer a few questions.
You may get an expensive quote if you apply for instant life insurance using simplified issue underwriting instead of a quote through accelerated underwriting, which costs the same as a policy with a medical exam. Instant life insurance policies are available from insurers such as Brighthouse SimplySelect, Ethos and Jenny Life.
A medical exam may not be required at all by your insurance company if you're young and in good health. You could be covered for $100,000 in minutes if this is the case.
A good rule of thumb is to get a life insurance policy with a coverage amount that's 10 to 12 times your annual income. In most cases, a $100,000 life insurance policy will suffice if:
Additionally, if you're financially secure, don't have any dependents, have only a few financial liabilities or have little debt, a $100,000 life insurance policy can make sense. It can cover final expenses or leave a legacy to loved ones. Those who currently have a life insurance policy and wish to extend the amount of coverage or its term may consider using a $100,000 term policy for this purpose.
For instance, a $100,000, 10-year term life insurance policy may be enough to cover your daughter's college tuition. However, you should not anticipate that this sum will cover major costs, such as your mortgage.
By understanding the answers to some of the most common questions people have about life insurance, you can better determine if a $100,000 life insurance policy is the right choice for your needs.
The average monthly cost of a $100,000 life insurance policy for a 30-year-old is $11.02 for a 10-year term and $12.59 for a 20-year term.
If you die while the policy is still in effect, the insurance company will pay your beneficiary a $100,000 lump sum or periodic payments. You can choose the term length and the payout option to suit your family's needs.
See also: How does life insurance work?
It depends. A $100,000 term life insurance policy is sufficient if you already have enough savings, have few financial obligations or owe little debt. It is also sufficient if you’re only looking for your insurance to cover funeral costs or other specific expenses.
Yes, at some companies you can purchase guaranteed issue life insurance, a type of whole life insurance, without the need for an exam. Keep in mind that these policies can be more expensive than a standard term life insurance policy since they don’t expire.
About Mark Fitzpatrick
Mark Fitzpatrick has analyzed the property and casualty insurance market for over five years, conducting original research and creating personalized content for every kind of buyer. Currently, he leads P&C insurance content production at MoneyGeek. Fitzpatrick has been quoted in several insurance-related publications, including CNBC, NBC News and Mashable.
Fitzpatrick earned a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He is passionate about using his knowledge of economics and insurance to bring transparency around financial topics and help others feel confident in their money moves.
