For young and healthy people in their 20s, 30s and 40s, a 20-year policy is the most popular term. It offers protection and peace of mind for a formative time of your life, and it’s an inexpensive, reliable option. While a lot can change in 20 years, your premium stays the same and will see you through major life changes, such as marriage, kids, college and buying a home.
As with all life insurance, the rate you’re offered is based on a range of factors, such as your age, health, lifestyle, medical history and occupation. With term life, the premiums stay the same for the life of the policy, which is why it’s a good idea to lock in a good rate early on. That way, even if your health changes over the course of 20 years, you won’t be charged more.
Let’s look at the typical cost of a $250,000, 20-year term life insurance policy. According to our research, the monthly cost for a 30-year-old nonsmoking man living in Los Angeles, California might be between $13.12 and $33.64, or . For a smoker, the rate tends to start at $39.77 and go up to $78.62.
For a 30-year-old nonsmoking woman, it might set her back between $11.71 and $30.28 a month. If she smokes, the rate could climb to somewhere between $32.03 and $62.65.
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*Sample rates provided by Quotacy and are valid as of August 2019.
A 20-year policy is the most popular type of term insurance, especially for the young and healthy. Ideally, you should take out a policy that matches your longest financial obligation — such as a mortgage or putting your kids through school.
With that in mind, these are some common reasons to purchase this policy:
That depends on your situation. To calculate your needs, think about why you’re purchasing life insurance.
Is it to simply cover your end-of-life expenses and pay off your debt? Or do you want to give your family a sense of financial security for the future, and maybe leave your kids or grandkids an inheritance? Your needs will be different if you’re still working.
If your needs are temporary, term life insurance will probably still be the best option for you. Here are some scenarios where a 20-year term life insurance policy isn’t the best fit.
Your coverage expires with your policy. At that point, you have several options:
The reason term life insurance rates are on the cheaper side is because people are living longer. Life expectancy plays a huge part in an underwriter’s calculations.
According to our life expectancy data, for a typical 40-year-old man, the risk of dying in the next 20 years is 10.20%. For the average woman, it’s 6.46%.
To put this into context, it helps to analyze these figures next to the average life expectancy in the US. A man who reaches his 65th birthday can expect to live until 84.3, while a woman is likely to live until 86. Of course, these are averages — around a quarter of 65-year-olds will live past 90.
How likely am I to die in the next 30 years?
| Age | Man | Woman |
|---|---|---|
| 30 | 4.72% | 2.89% |
| 31 | 5.06% | 3.13% |
| 32 | 5.43% | 3.40% |
| 33 | 5.85% | 3.69% |
| 34 | 6.32% | 4.01% |
| 35 | 6.83% | 4.35% |
| 36 | 7.40% | 4.72% |
| 37 | 8.02% | 5.12% |
| 38 | 8.70% | 5.54% |
| 39 | 9.42% | 5.99% |
| 40 | 10.20% | 6.46% |
| 41 | 11.03% | 6.96% |
| 42 | 11.92% | 7.50% |
| 43 | 12.86% | 8.07% |
| 44 | 13.84% | 8.68% |
| 45 | 14.88% | 9.34% |
| 46 | 15.96% | 10.05% |
| 47 | 17.11% | 10.82% |
| 48 | 18.32% | 11.65% |
| 49 | 19.61% | 12.56% |
| 50 | 20.97% | 13.55% |
20-year term policies are the most popular — especially for those in their 20s, 30s and 40s. It makes sense. This kind of coverage offers protection and peace of mind during a period of major life changes, like marriage, children and buying a home, all while giving you the time to pay off your debt and build up your wealth while you’re still working.
Life insurance is personalized. To make sure you’re buying the coverage that suits you best, explore our guide to life insurance.
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The tax implications of life insurance as an individual, self-employed person, owner of an LLC and more.
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Connect with a local agent in your state to find term, universal and whole life policies, with lenient rates if you’re not in perfect health.
Find out your odds of dying in more than 20 circumstances — and prepare to be surprised.
In most cases, you can change the person who’s empowered to make decisions on your behalf.
