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$25,000 life insurance policy

Options for a low-coverage policy are limited, though they’re easy to qualify for.

If you need a $25,000 life insurance policy, your choices can be limited. Very few insurance companies offer policies as low as $25,000. And if they do offer a policy this small, the premium may be the same as a larger policy simply because the $25,000 one may not require a medical exam.

How much does $25,000 life insurance cost?

When it comes to nearly every life insurance policy, the two most important factors that determine your costs are your age and health. The younger and healthier you are, the lower your costs are likely to be.

$25,000 life insurance policies tend to be marketed toward adults 60 years old and older who are looking to cover end-of-life expenses. These types of policies typically don’t require an exam, such as guaranteed issue life insurance, but expect the premiums to be higher due to a lack of exam.

To get an exact quote for a $25,000 life insurance policy, you may need to call around. We found an online quote from AAA that advertised rates at $23 per month for a 30-year-old man in good health and $20.44 for a woman.

A $25,000 whole life policy is best for funeral costs

Usually, $25,000 whole life insurance policies are aimed at seniors looking to get coverage for funeral costs or tie up loose ends once they pass. A whole life policy is a lifelong policy with fixed payments and fixed interest. As long as you pay your premiums, you’re covered. Once you pass the beneficiary gets the full amount.

Funeral costs vary, but a funeral could run you anywhere from $5,000 to $10,000, depending on your plans. If you don’t have any extravagant debts and simply need funeral costs covered, a $25,000 whole life policy could suit you just fine.

A $25,000 term life policy isn’t easy to find

If you only need $25,000 in coverage, know that many term life policies require a minimum coverage amount of around $50,000 or $100,000, so you may struggle to find $25,000 term life coverage.

If you make it throughout the entire term, there’s no payout, and you’ll have to extend your coverage or choose another policy. Term life policies are more popular with younger adults, and they’re often less expensive than permanent policies like whole life.

Unlike a whole life policy, a term life policy doesn’t last forever. You typically have the option of choosing a term between five to 30 years, depending on the insurer. Finding a $25,000 policy with a 30-year term is likely to be challenging, though. You may have to opt for a shorter term. In some cases, if you’re over 50 years old, a 30-year term may not be an option.

Eligibility requirements for $25,000 life insurance policy

You may not have your choice of insurers, but the eligibility requirements for a policy this small shouldn’t be too strict compared to larger policies. And as with any insurance policy, your health and age are the major factors in both eligibility and how much you’ll pay. If you smoke, for example, you’re premiums are likely to be higher. You may have to plan on paying two to three times more than a non-smoker.

During the underwriting process, insurance companies are likely to need proof that justifies the size of the policy you’re applying for. As a general rule, most insurers say to buy insurance that’s six to 10 times your yearly income. In the case of a $25,000 policy, a low-income earner is likely to qualify – just make sure you can comfortably afford the premiums.

Can I get $25,000 coverage without a medical exam?

Because no-exam policies, such as guaranteed issue and simplified issue insurance, tend to have low-coverage caps, you might be able to purchase $25,000 in coverage without a medical exam. Depending on the insurer, you may still have to fill out a medical questionnaire though.

Is a $25,000 life insurance policy right for me?

The coverage you need depends on your circumstances. A $25,000 benefit may not replace your income, but consider the following factors when determining the coverage you need:

  • Funeral expenses. The average cost of a funeral can range between $5,000 and $10,000, a cost your life insurance could help cover.
  • Medical expenses. Make sure your family can cover any medical bills associated with your death.
  • Debt and bills. Your insurance can cover any outstanding bills or debts you leave behind.
  • Family expenses. There may not be much money left over after all your end-of-life bills are covered, but any money left over can help your family grieve with fewer financial stresses.
Name Product Issue age Minimum Coverage Maximum Coverage Term Lengths Medical Exam Required
JRC Life Insurance
18 - 85 years old
$5,000
$50,000,000
10, 15, 20, 25, 30, 35, 40 years to lifetime/age 121
May be required
Compare policies up to $10 million from 45+ top insurance companies with the click of a button.
Nationwide life insurance
18 - 80 years old
$25,000
$10,000,000
10, 15, 20 and 30 years
Yes
Get term, whole, universal or no-exam life insurance with up to $1 million in coverage.
Fidelity
20 - 85 years old
$25,000
$1,000,000
10, 20, or 30 years
Depends on policy
Purchase term, whole and accidental death coverage online without the exam, with rates starting at a low $10 a month.
Dayforward Life Insurance
18 - 67 years old
$12,000
$500,000
from 10 to 27 years
No exams for some applicants
Dayforward allows you to protect your family with life insurance that protects your income.
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What to watch out for

Your leftover expenses may be among your top concerns when considering a lower coverage policy. Because so few insurers carry standard term or whole life $25,000 policies, you won’t have many options when shopping around. And no-exam policies typically cost more.

What if I need more coverage in the future?

If you think you may need more coverage, you can look for a policy that includes a future increase rider that allows you to expand your coverage later in life. Alternatively, you could also purchase an additional or replacement policy when you decide you need it.

Bottom line

If you’re single with little to no debt, a $25,000 policy could be just enough to cover any expenses you might leave behind. But when you compare life insurance companies, you may find that choosing a larger policy gives you more options, which could mean paying a similar or even less expensive premium for significantly more coverage.

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