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How Much Life Insurance Do I Need?

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There are hundreds of different types of insurance in the world today. Ask any insurance agent, and they will tell you that life insurance is the most overlooked one of them all. What makes this so odd, life insurance is the most important one of them all.

Life insurance itself is hundreds of years old. Its design is simple. An insured (policyholder) pays an insurer (the insurance company) a dollar amount called premium.

In return, an insurer will promise to pay funds (a death benefit) to any person of your choosing (a beneficiary), as long as their name is on your policy before you pass away. As long as premiums are still being paid, the insurance company is obligated to pay a beneficiary a death benefit.

The Best Life Insurance:

  • Best Overall for Life Insurance: Bestow
  • Easy Conversion Options: State Farm
  • Best for Non-Smokers: Transamerica
  • Best for People with Children: Fabric
  • Best for Term Life Insurance: Haven Life

Who Needs Life Insurance?

Everyone, no matter their age can benefit from a life insurance policy. However, the people that mostly buy it have families that they need to make sure are financially stable, even if they were to die.

Who Can You Get a Life Insurance Policy For?

When insurance first hit the market hundreds of years ago, there were little to no rules. So, criminals would take life insurance policies out on, let’s say their neighbor, with, or without the neighbor even knowing. The criminal would then kill the neighbor, and collect the life insurance check.

Needless to say, insurance carriers figured this out real fast and adopted a key rule called insurable interest (some related to you, even a spouse). Today, it is not possible to take out a life insurance policy on someone who you do not have an insurable interest on.

People who you can take out a life insurance on are as follows:

  • A spouse
  • A child
  • A parent
  • A grandchild
  • A sibling
  • An aunt or uncle

When Is the Best Time To Purchase Life Insurance?

The best time to purchase life insurance is when you find yourself responsible for the well-being of other family members, or a spouse. If you are the breadwinner, and you love your family, the worst thing you could do to them is dying and leaving them a ton of bills. So many, that your spouse and child can no longer afford the way of life they were accustomed to when you were alive.

Now, they face losing the home. The children face not being able to go to the college of their choice. The living spouse might have to work 2 and three jobs to survive, and this could end up being something you never envisioned your family having to go through upon your death.

Where Can I Find Life Insurance Quotes?

Life insurance quotes are pretty easy to get these days. Just log on to your favorite search engine, and type in life insurance. Your search should bring back more options than you will know what to do with.

What Are The Main Types Of Life Insurance?

Life insurance has two main types; whole life and term life insurance. Each still pays a death benefit, however, how long they last are vastly different.

  • Whole Life – Whole life is just how it sounds. As long as you keep paying your premiums, the policy will keep covering you until your last day.
  • Term Life – This policy only provides life insurance for a very specific amount of time. The time frames are usually in amounts of 10, 20, and 30-year policies.

Best Life Insurance Companies

Protecting your family doesn’t have to be expensive. It’s never been easier to get a cheap life insurance policy for just a few dollars a month. Start your search with our favorite low-cost life insurance policy providers.

Age Requirements
21-55
Coverage Amounts
$50,000 – $1,000,000
Starting Rate
$8/month

1. Bestow

With plans starting at just $8 a month Bestow is perfect for anyone on a budget. This affordable term life insurance allows you to skip the doctor appointment and say “no thanks” to the stacks of paperwork. You can get a quote quickly and when it’s convenient for you because everything is 100% online. Answer a few simple questions and get a decision instantly.

There is no need to enter your name, email or phone number to get a quote. Bestow relies on data rather than feedback from a medical exam. Take life into your own hands by applying with Bestow, the ideal combination of age-old quality fused with modern technology to deliver one of the best companies on the market.

10 and 20-year policies are available, just another reason why this customizable life insurance makes our top list.

Age Requirements
18 – 75
Coverage Amounts
$100,000 to $3,000,000
Starting Rate
$15/month

2. State Farm

Having trouble finding coverage in your area? Chances are that State Farm has a policy option that’s right for you. Operating across the United States, only 3 states are excluded from State Farm’s term life insurance options — New York, Massachusetts and Wisconsin.

Residents of all other states can get a comprehensive term life policy and some of the best customer service in the insurance realm.

State Farm also has a very generous conversion policy if you decide that you want to switch to a permanent plan. Policyholders under the age of 75 can switch at any time without taking another medical examination.

State Farm’s policies are a bit pricier than competitors like TIAA and Banner Life — 10-year plans start at about $15 per month and 30-year coverage options will usually cost you at least $19 in monthly premiums. Shoppers who want to take advantage of the company’s nationwide status or easy conversion options can with just a few extra dollars every month.

Age Requirements
18 – 80
Coverage Amounts
$25,000 to $10,000,000

3. Transamerica

Transamerica offers a wide range of term life insurance options, with protections beginning at $25,000 and going all the way up to $10 million. If you have a very high net worth, you may also be able to get even more upon individual consideration.

Though most life insurance companies require policy applicants to get a health examination before they’re accepted for a policy, Transamerica may allow you to skip the exam if you’re under a certain age and you don’t smoke.

Transamerica is one of the best policy providers for flexible coverage choices. You can add riders for end-of-life care, additional financial coverage for accidental death and even critical illness coverage that begins to pay out while you’re still alive under certain circumstances.

Though Transamerica’s policies are pretty expensive if you’re a smoker (tobacco users pay about $100 more per year for their policy), you’ll get an excellent reputation and personalized choices with Transamerica.

Age Requirements
21 – 60
Coverage Amounts
$100,000 to $5,000,000
Starting Rate
$12/month
Application Length
10 minutes

4. Fabric

Fabric offers term life insurance for individuals between the ages of 21 and 60. They believe that life insurance isn’t for you, it’s for your family. You can apply in as quick as 10 minutes and could be offered coverage on the spot. Their policies are issued by Vantis Life, a Penn Mutual Company, so your policy is backed by a highly-rated, financially stable provider.

Apply online or in Fabric’s mobile app. They offer a range of term lengths and coverage amounts to help you find a policy that works for you. Choose from 10, 15 or 20-year terms and coverage amounts from $100,000 up to $5,000,000.

To get an idea of how much you might spend on term life insurance with a Fabric policy, we gathered a real quote. A 20-year term life insurance policy for a 29-year-old female in excellent condition with a coverage amount of $250,000 would pay around $14.61 per month. That’s less than a burger combo at Shake Shack! Apply now and see what this affordable term life insurance will cost you.

Age Requirements
18 – 64
Coverage Amounts
$50,000 – $3,000,000
Starting Rate
$14.99/month

5. Best for Families and Term-Life Insurance: Haven Life

Haven Life is an innovative life insurance agency that offers a simple way to obtain term life insurance for those between the ages of 18 and 64. You can choose a term length of 10, 15, 20 or 30-years. What’s unique about this term life insurance is the way you can complete an application online and, if approved, digitally purchase coverage.

Haven Life is backed and wholly owned by MassMutual, a nearly 170-year-old life insurance company with a long history of claims-paying ability. Also available is Haven Life Plus, a no-cost rider to the Haven Term policy for customers in eligible states. Some of the great services included with Haven Life Plus are:

  • A world-class fitness app with thousands of workouts and (most importantly) great music
  • An app that combines the latest sleep and neuroscience research to help prevent jet lag
  • A customized, state-specific, legally valid online will

Affordable and dependable, Haven Life offers protection for your family in the event of an unfortunate loss. A 20-year, $500,000 Haven Term policy, issued by MassMutual, for a healthy 35-year-old woman, is $23.34 per month. For perspective, the average American adult spends around $50 every month on subscription services. Apply for Haven Life to help financially protect your loved ones.

Next Steps

Get at least three life insurance quotes before deciding on a policy. Do research on the companies in question. Term life policies are always cheaper than whole life policies. Whole life policies gain a cash value, and a loan can be borrowed from them at certain points.

Frequently Asked Questions

1) Q: What are the advantages of term life insurance?

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1) Q: What are the advantages of term life insurance?
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A term life policy allows you to purchase coverage at a guaranteed premium for a limited amount of time. This structure makes term life an affordable choice to protect your family if you have a financial commitment that won’t last forever, like a mortgage or the cost of raising kids. A 20-year term life insurance policy is the most popular life insurance policy purchased to protect loved ones if the unexpected happens. Get a quote here from top providers.

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2) Q: How much life insurance do I need?

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2) Q: How much life insurance do I need?
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Many in the industry recommend that you carry 8-12 times your annual income in life insurance coverage. A more granular approach can be beneficial, however, and accounting for debt and ongoing financial commitments in more detail when choosing a coverage amount can better provide for your family than an arbitrary multiple of earnings. Get a customized quote for the best policy.

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3) Q: How can I lower my life insurance premiums?

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3) Q: How can I lower my life insurance premiums?
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Life insurance premiums are based on age, insured amount, and a number of health and behavioral risk factors. Rates have fallen in recent years as longevity has increased and insurers have become better at pricing risk factors. If you have an old policy, it may be possible to replace your coverage for a lower premium with a new policy. If you don’t have coverage yet, don’t wait too long to buy a policy. Rates increase with age. Many insurers also offer a sizeable discount on auto insurance if you have a life insurance policy with the company as well, creating a way to save money on your overall insurance costs. Get the best deals here

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Our Recommendation: Find your best fit with Policygenius

Finding the right company for your situation means considering all of your options and getting the right advice. Policygenius makes it easy to get personalized quotes from top insurers and apply for your best policy all in one place. Their combination of online tools and support from unbiased, licensed experts makes Policygenius the best site to help you get insurance right.