Life Insurance
If you're looking for financial protection for your loved ones, a 30-year term life insurance policy can offer peace of mind. But with so much information out there, it can be overwhelming to figure out the best option for you. That's where MoneyGeek comes in – we're here to provide you with the information you need to make an informed decision. Below, we break down everything you need to know about 30-year life insurance policies, including how they work, how much they cost, and whether they're the right choice for your current financial situation.
Table of Contents
What Is a 30-Year Term Life Policy?
A 30-year term life insurance policy is a type of term life insurance that provides temporary coverage for a period of 30 years. Unlike permanent life insurance, which can be expensive, term life insurance is significantly more affordable. With a 30-year term life insurance policy, your beneficiaries will receive the death benefit if you pass away while the policy is still in effect, as long as you have not missed any premium payments.
For instance, if you purchase a policy with a $500,000 face value at 35, you will be covered until you are 65 years old. If you were to pass away at the age of 55, your beneficiaries would have to submit a claim, and once approved, your insurer would pay out the death benefit as a tax-free lump sum. Your beneficiaries could then use the money as needed, such as to cover funeral expenses, pay off debts, or cover household expenses.
While a 30-year term life insurance policy is the longest term option available, if you require coverage for a more extended period, permanent life insurance may be a better choice.
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.
How Much Does a 30-Year Term Life Policy Cost on Average?
The cost of a 30-year term life insurance policy is determined by several factors, including the policyholder’s age, gender, health, occupation, and hobbies. Insurance providers use this information to assess the policyholder's risk of dying during the policy term. The higher the risk, the higher the premium the policyholder will have to pay.
Age is a significant factor, as older policyholders are more likely to pass away during the policy term, so their premiums will be higher. Gender also plays a role, as women typically live longer than men and therefore have lower premiums.
Health is another critical factor, as policyholders with pre-existing medical conditions or unhealthy habits like smoking are more likely to die during the policy term and will face higher premiums. Occupation and hobbies can also affect the cost of the policy, as some jobs and activities are riskier than others.
Additionally, the amount of coverage desired, or the face value of the policy, will impact the cost. The higher the face value, the higher the premium. Finally, the length of the policy term will also impact the cost, with longer terms typically costing more than shorter ones.
The table below shows how rates increase for 30-, 40- and 50-year-old buyers across various coverage amounts.
Policyholder Age | $250,000 | $500,000 | $1,000,000 |
|---|---|---|---|
30-Year-Old | $30.57 | $41.94 | $78.83 |
40-Year-Old | $43.09 | $62.37 | $122.80 |
50-Year-Old | $96.85 | $155.94 | $296.79 |
Which Companies Have the Best 30-Year Term Rates?
MoneyGeek’s study compared multiple life insurance quotes with various coverage amounts from different insurers nationwide. Regardless of your policy’s face value, you can typically purchase the most affordable life insurance from Transamerica. They offer the following rates for each coverage amount:
- $250,000: $21.80 per month
- $500,000: $33.43 per month
- $1,000,000: $53.78 per month
Examine how rates change across insurers based on the coverage amount to help determine how much coverage you can afford.
30-Year Term Policy Monthly Premium by Company & Coverage
Company | $250,000 | $500,000 | $1,000,000 | |
|---|---|---|---|---|
1. | Transamerica | $21.80 | $33.43 | $53.78 |
2. | Mutual of Omaha | $25.08 | $40.34 | $71.52 |
3. | Mass Mutual | $25.74 | $39.72 | $65.44 |
4. | Nationwide | $26.62 | $38.45 | $65.81 |
5. | AAA | $29.74 | $38.67 | $80.31 |
6. | Progressive | $37.13 | $59.56 | $158.07 |
7. | Prudential | $57.09 | $58.85 | $115.16 |
Cheapest 30-Year Term Life Insurance Providers for Smokers
Life insurance for smokers cost much more than that of non-smokers. According to the CDC, smoking shortens your life expectancy by at least 10 years, making smokers riskier to insure.
The most affordable life insurance policies for smokers comes from Transamerica. The average premiums of their policies for different coverage amounts are as follows:
- $250,000: $66.13 per month
- $500,000: $117.00 per month
- $1,000,000: $219.46 per month
Take a look at how rates vary from company to company to narrow down your options.
30-Year Term Policy Monthly Premium Cost by Company for Smokers
Company | $250,000 | $500,000 | $1,000,000 | |
|---|---|---|---|---|
1. | Transamerica | $66.13 | $117.00 | $219.46 |
2. | Mass Mutual | $77.57 | $141.17 | $265.40 |
3. | Nationwide | $85.77 | $275.79 | $533.09 |
4. | AAA | $93.32 | $165.82 | $313.80 |
5. | Mutual of Omaha | $93.74 | $155.16 | $300.92 |
6. | Progressive | $94.47 | $172.77 | $385.96 |
7. | Prudential | $115.51 | $172.18 | $341.80 |
Cheapest 30-Year Term Life Insurance if You're in Poor Health
MoneyGeek also compared quotes for policyholders who have poor health. Mutual of Omaha offers the lowest average rates across different coverage levels for this type of customer:
- $250,000: $25.08 per month
- $500,000: $40.34 per month
- $1,000,000: $71.52 per month
Learning more about how much each company charges policyholders in poor health can help you find the best deal for life insurance.
30-Year Term Costs by Company for Those in Poor Health
Company | $250,000 | $500,000 | $1,000,000 | |
|---|---|---|---|---|
1. | Mutual of Omaha | $25.08 | $40.34 | $71.52 |
2. | Transamerica | $34.15 | $55.96 | $95.92 |
3. | Mass Mutual | $44.85 | $74.26 | $133.07 |
4. | Nationwide | $47.69 | $79.85 | $145.66 |
5. | AAA | $49.45 | $83.28 | $153.18 |
6. | Progressive | $51.83 | $86.75 | $158.07 |
7. | Prudential | $59.34 | $99.94 | $183.82 |
Cheapest 30-Year Term Life Insurance Providers for Older Buyers
The older you are, the more expensive premiums become because there is a lower likelihood that you’ll outlive your policy. Transamerica offers the cheapest average 30-year term life insurance rates for older buyers. Their rates for the different coverage amounts are:
- $250,000: $69.76 per month
- $500,000: $124.27 per month
- $1,000,000: $229.64 per month
Take a look at the varying rates offered by different insurers and consider which ones suit your needs.
30-Year Term Cost by Company for a 50-Year-Old
Company | $250,000 | $500,000 | $1,000,000 | |
|---|---|---|---|---|
1. | Transamerica | $69.76 | $124.27 | $229.64 |
2. | Nationwide | $80.60 | $146.40 | $278.75 |
3. | Mass Mutual | $86.39 | $158.07 | $297.74 |
4. | Mutual of Omaha | $87.58 | $156.61 | $303.83 |
5. | AAA | $96.30 | $179.95 | $343.54 |
6. | Progressive | $166.52 | $308.76 | $610.92 |
7. | Prudential | $186.95 | $169.35 | $336.17 |
Is a 30-Year Term Life Policy Right for You?
You have multiple options for policy length when purchasing term life insurance. The best way to figure out whether a 30-year term is appropriate for you is to examine your current financial situation. Depending on your profile, a 30-year term life insurance policy may or may not suit your needs.
You have young children.
A 30-year term life insurance policy can be an excellent option if you have children because it provides protection for a set period, ensuring that your children will be financially supported if you pass away during that time. Term life insurance policies are typically much more affordable than permanent life insurance policies, making it easier to secure coverage for a higher face value amount.
For example, let's say you have a 10-year-old child and you want to ensure that they will be taken care of until they are at least 20 years old. You can purchase a 30-year term life insurance policy that will provide coverage until your child is 40 years old. If you pass away during that period, the policy will pay out a tax-free lump sum to your beneficiaries, which can be used to cover expenses such as mortgage payments, tuition fees, and everyday living costs.
A 30-year term life insurance policy can also help ensure that your children have access to funds to pay for future expenses such as college tuition. By purchasing a policy that covers the length of time your children will be in school, you can rest assured that they will have the financial support they need to complete their education.
You have long-term debts.
A 30-year term life insurance policy could be a good option if one has long-term debts because it provides coverage for a set period, which aligns with the time frame of many long-term debts such as mortgages. If the policyholder passes away before the term is up, the death benefit can be used to pay off the outstanding debts. This can provide peace of mind for the policyholder knowing that their loved ones won't be burdened with debt if something happens to them. Additionally, because term life insurance premiums are generally more affordable than permanent life insurance, a 30-year term policy may be a cost-effective way to ensure that debts are covered.
You want coverage while you’re working.
A 30-year term life insurance policy might be a good option if one is working because it provides coverage for a long period of time, which can be helpful in protecting the individual's family and assets in the event of an unexpected death. If someone is the primary breadwinner in their family, a 30-year term life policy can provide financial protection for their dependents, even if they pass away before they reach retirement age. Additionally, if the individual has long-term financial goals, such as paying off a mortgage or saving for their children's college education, a 30-year term life insurance policy can provide the necessary financial support to help achieve these goals.
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.
What Happens After the 30-Year Term?
If you are still alive at the end of the 30-year term, you can either extend your coverage or give it up. Before you decide which direction is most appropriate for you, there are several factors you need to consider.
If you choose to continue having life insurance, sometimes it's a better idea to purchase a new (and possibly shorter) policy. Choosing to renew your existing policy opens you up to significantly higher rates — at this point, you’ll be 30 years older, and your life expectancy is 30 years shorter.
However, if you're in worse health since the first time you bought life insurance, renewing may be a better option. In this situation, if you apply for a new policy, insurers may refuse to cover you or offer premiums even higher than renewal rates.
If you're financially independent and don't have children or a spouse who depends on you financially, giving up coverage may work out. Life insurance, although extremely helpful, isn't necessary for everyone at all times.
Frequently Asked Questions About 30-Year Term Life Insurance
A 30-year term life insurance policy is an excellent option for some buyer profiles but may not be for everyone. Understanding the answers to some frequently asked questions about this type of insurance can help you determine if it fits your needs.
Life Insurance
About Mark Fitzpatrick
sources
- Centers for Disease Control and Prevention. "Tobacco-Related Mortality." Accessed November 17, 2021.