Buying Life Insurance When Single

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ByMark Fitzpatrick
Reviewed byMandy Sleight
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ByMark Fitzpatrick
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Reviewed byMandy Sleight
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Updated: May 22, 2024

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Life insurance, often associated with married individuals or those with dependents, can also offer substantial benefits to single people. Although single people might not feel the immediate need for a policy, there are several compelling reasons to consider buying life insurance when single. This decision depends on factors such as plans for a family, existing financial obligations and the desire to leave a financial legacy. Understanding these aspects can guide single consumers in making an informed decision about life insurance.

Why Single People Should Consider Life Insurance

There's an assumption that life insurance is only for people who have dependents. However, there are many reasons why single people might consider purchasing a life insurance policy. We explore some of the primary motivations below:

  1. Income Protection for Dependents: Being single doesn't necessarily mean you have no financial dependents. You may have elderly parents, siblings or even pets relying on your income. Life insurance for a single person with no dependents can still cover those who indirectly depend on you.
  2. Anticipation of Future Dependents: Even if you're single now, you might be planning to start a family in the future. By purchasing life insurance early, you can secure a lower premium and ensure that future dependents have financial security.
  3. Debt Coverage: Life insurance for a single person can cover outstanding personal debts, like student loans, personal loans or a mortgage. This coverage can ensure that these debts won't fall onto the shoulders of surviving family members.
  4. Funeral Expenses: Life insurance can also cover the cost of funeral and burial expenses, alleviating the financial stress for loved ones during an already challenging time.
  5. Legacy Planning: Life insurance allows single individuals to leave a financial legacy to a chosen beneficiary, be it a charity, a beloved niece or nephew or another loved one.
  6. Business Obligations: If you're running a business, single-person life insurance could cover business-related debts, protect the business's continuation or facilitate a business succession plan.
  7. Tax Benefits: Some life insurance policies provide tax advantages, like tax-free death benefits and tax-deferred growth on cash value.
  8. Future Insurability: Purchasing life insurance when young and healthy secures your future insurability, irrespective of potential health changes later in life.
  9. Estate Liquidity: For single individuals with significant assets, life insurance can provide the liquidity needed to pay estate taxes and prevent the forced sale of assets.

Consider how these reasons may apply to you and your future financial goals to make a more informed decision about purchasing life insurance when single.

Benefits of Buying Life Insurance When Single

Getting life insurance earlier on in life can significantly benefit single people, offering affordable premiums and aiding in long-term financial planning.

Lower Premiums

One of the most appealing advantages of purchasing life insurance for a single person at a younger age is the potential for lower premiums. Insurance is all about risk assessment, and younger, typically healthier individuals pose less risk to insurers. The more affordable premiums you can secure when you invest in life insurance early reflect this lower risk.

Enhanced Insurability

At a younger age, you're more likely to be in good health. Insurers will often require medical examinations or health declarations, and a clean bill of health can improve your insurability, securing more favorable terms on your policy.

Protection Against Future Health Changes

Life is unpredictable, and health conditions can develop unexpectedly. If you secure a single-person life insurance policy when you're young and healthy, your coverage is typically unaffected by any subsequent health issues. This way, you safeguard your insurability regardless of what the future might hold.

More Time to Accumulate Cash Value

If you opt for a permanent life insurance policy, starting young gives your policy more time to accumulate cash value. This component of your policy serves as a form of savings that you can borrow against or even withdraw from, adding another layer of financial security.

Possibility for More Extended Term Coverage

By purchasing term life insurance when you're younger, you can lock in a more extended term period, such as a 30-year term life insurance policy, securing your insurability and rate for a more extended period.

Buying life insurance when you're young and single isn't just about protecting potential future dependents. It's also about taking proactive steps to secure your financial future, protect against the unexpected and lay the groundwork for sound financial planning.

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Even before starting a family, buying life insurance at a young age is a wise financial decision. It helps secure lower premiums and ensures that you can get coverage in the future.

Types of Life Insurance for Single People

There are two primary types of life insurance: term and permanent. We highlight the major differences between these policies below:

  • Term Life Insurance: This insurance offers coverage for a set period, generally 10–30 years. It's straightforward, cheaper and often the best choice for most single individuals. If the policyholder dies within this term, the insurer pays a death benefit to the beneficiaries. If the policyholder outlives the term, the coverage ceases without a payout. Its affordability and simplicity make term life a popular choice for single individuals.

  • Permanent Life Insurance: This policy type covers the policyholder's entire life span. It has a cash value component that can grow or earn interest over time. However, these policies are more complex and expensive compared to term policies. An example of a permanent life insurance policy is whole life insurance.

Explore the differences between whole life and term life insurance to find the coverage that best suits your needs.

Average Cost of Life Insurance for a Single Person

The average cost of a 10-year term life insurance policy with $250,000 in coverage for a healthy, 40-year-old individual is $18 per month. Meanwhile, a 20-year term life insurance policy with the same coverage costs $26 monthly.

Policy costs can vary significantly based on age, lifestyle and overall health. The coverage amount you choose and the type of life insurance can also affect your premium rates.

The table below gives an overview of the average monthly costs of term life insurance for various ages and coverage amounts.

Data filtered by:Results filtered by:
$250K10-Year Term$ 1820-Year Term$ 26
$500K10-Year Term$ 2920-Year Term$ 44
$1 Million10-Year Term$ 5320-Year Term$ 83

Life Insurance for Single Seniors

Life insurance remains important for single seniors, offering financial assurance during retirement. It can serve several valuable functions:

  • Estate Planning: Life insurance can help older adults manage their estate by providing funds to cover taxes or other expenses, thus avoiding the rushed sale of assets.
  • Funeral Expenses: Life insurance can ease the financial load on surviving family or friends by covering funeral and burial costs.
  • Leaving a Legacy: Seniors can use life insurance to leave a financial legacy to loved ones or cherished charities.
  • Financial Gift: Life insurance can be a significant financial gift for grandchildren or other family members.

Some policies specifically serve single seniors in these ways. Guaranteed acceptance life insurance assures coverage regardless of health status or age, making it attractive for older individuals. However, these policies often have a waiting period before full death benefits are payable.

Another approach single seniors can consider is a final expense insurance policy, which specifically covers end-of-life expenses, including funeral and burial costs. These policies are easier to qualify for, and premiums usually don't increase with age, providing older adults peace of mind that their end-of-life expenses won't burden their loved ones.

For more information, see our guide to the best life insurance for seniors.

Who Should Buy Life Insurance

Determining the need for life insurance as a single person relies on personal circumstances, needs and goals. We highlight the significant considerations for single people below:

You should consider buying life insurance as a single person if:
  • You have dependents like aging parents or a non-working sibling.
  • You hold significant debts, such as mortgages or private student loans.
  • You're planning for future dependents and want to lock in lower rates.
  • You're a business owner with financial responsibilities tied to your business.
You may not have an immediate need to buy life insurance if:
  • You have no dependents and minimal financial obligations.
  • Your assets are sufficient to cover any outstanding debts and funeral expenses.
  • You have adequate savings or investments to provide for any dependents in the future.

Remember that buying life insurance as a single person is a strategic decision that involves weighing your current and future financial needs.

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Reevaluate your life insurance needs periodically, particularly when significant changes in your life or financial situation occur. Events like acquiring new debts, changes in health status or shifts in family dynamics can impact the type and amount of coverage you need. Updating your insurance plan as necessary ensures it aligns with your current life circumstances.

FAQ About Buying Life Insurance When Single

Life insurance offers many benefits but may not be necessary for everyone. Below are answers to some common questions about purchasing life insurance as a single individual to help you make an informed decision.

Who needs life insurance?
Is life insurance necessary if you're single and without dependents?
Should you buy life insurance when you're young and healthy?
What type of life insurance is best for singles?
Can life insurance cover your business debts if you're single?
Are there age restrictions for buying life insurance?
How much life insurance do you need as a single person?
What happens if you don't have life insurance?

About Mark Fitzpatrick

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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.