Getting a $250,000 life insurance policy

Popular among seniors and those new to the workforce, this policy can take care of your family when you’re gone.

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No one can predict the future, but life insurance can help you protect your family. Ideally, your policy should allow your beneficiaries to maintain the lifestyle they’ve grown accustomed to.

The best time to purchase life insurance is as soon as you need it. If that’s now, you might be wondering how much coverage you should buy.

To answer this question, consider your income, assets and your financial obligations now and in the future. A $250,000 policy is generally inexpensive and popular among seniors and young earners, as well as careful savers who have healthy savings, retirement and 401(k) accounts.

Why we like:

Term life insurance with no policy fees and the freedom to cancel anytime. Simple application process that can get you approved for coverage instantly.

  • Apply online and get a decision instantly
  • Cancel your coverage at any time
  • No annual fees

Why we like: LadderLife™ Life Insurance

Term life insurance with no policy fees and the freedom to cancel anytime. Simple application process that can get you approved for coverage instantly.

  • No brokers trying to upsell you
  • Your rate is locked in until your term expires
  • 30 day money-back guarantee

How much does a $250,000 life insurance policy cost?

As one of the most popular policies on the market, there’s stiff competition between insurers to get your business. This drives down rates, making a $250,000 policy pretty affordable, and even more so if you’re young, healthy and a non-smoker.

Life insurance is customized to the individual, so the rate you’re offered reflects your gender, age, health, lifestyle, job and hobbies, plus the length of your policy.

Let’s look at the average cost for a 20-year term policy with $250,000 of coverage. To determine the cost, we compared rates from 10 major carriers.

A 30-year-old nonsmoking man in perfect health typically pays around $17.94 a month. If he smokes, the rate could climb to $48.16 a month.

Meanwhile, a 30-year-old nonsmoking woman might pay $15.28 a month. Smokers can expect a higher rate of around $39.52 a month.

To lock down the best possible rate, apply for a life insurance policy as soon as you need it.

*Based on sample rates from Policygenius, August 2019

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Is a $250,000 life insurance policy right for me?

The amount of coverage you buy should account for three things: Your income, your assets and your financial obligations.

Your income

Most people purchase policies that replaces their income and covers their family’s cost of living for 5 to 10 years. To figure out how much coverage to carry, choose a target number — like 10 years — and work backwards from there. Use your salary as a starting point, and consider any other funds your family would have access to when you die, such as retirement accounts, savings and Social Security. If you think your dependents would need $250,000 to pay for their living expenses over 10 years, you may be in the market for a $250,000 policy.

Your assets

As you work your way up the career ladder, you’ll most likely acquire assets and wealth, like a house, car, savings account or 401(k). If your estate is worth $250,000, a life insurance policy can protect it and provide liquid cash to pay estate taxes. And if you’re a careful saver with healthy bank accounts and lucrative investments, you may need a smaller policy.

Your financial obligations

Assess everything you pay for now and expect to pay for in the future. Your responsibilities might include:

  • Debt. Your debt doesn’t die with you, so you’ll want to leave enough money to cover your mortgage, student loans, car loan and credit card debt.
  • Children. The general rule is to cover your kids until they’re working and earning money themselves. So if they’re young, aim for a larger policy.
  • Spouse. If your partner is a stay-at-home parent or works part time, add more coverage. If they’re the breadwinner or much younger than you, you may be able to reduce it.
  • College costs. Increase the coverage amount for each child who plans to go to college.
  • Business expenses. The value of your business determines your need for life insurance.
  • End-of-life expenses. To avoid saddling your family with the financial burden of paying for your funeral, most policyholders set some funds aside.

Do your financial obligations add up to $250,000? You’re in the market for a quarter of a million dollars of coverage.

When you’re crunching the numbers, be wary about buying too much life insurance. Your policy should mirror your financial situation, so only buy a $250,000 policy if you really need it.

Can I get a $250,000 life insurance policy?

To qualify for a $250,000 policy, you’ll need to meet requirements set by your insurance company.

Your insurer will take your age and health into account, and as always with life insurance, young, healthy applicants are the best candidates. Insurance companies aren’t huge risk takers — they calculate your risk of dying during the term based on your age, health and family history, and assess your eligibility from there.

Next, your provider looks at your income. It needs to know you can afford to pay the annual or monthly premiums on your policy. The good news is that the financial requirements for $250,000 of coverage aren’t too high.

Typically, insurers will approve applicants earning these salaries:

  • Age 18–40: $10,000 per year or more
  • Age 41–50: $16,666 per year or more
  • Age 51–55: $50,000 per year or more
  • Age 56–65: $25,000 per year or more
  • Age 66–70: $50,000 per year or more

So, depending on your age, you’ll need to prove that $250,000 is between 5 and 25 times your annual income.

Can I get $250,000 coverage without a medical exam?

Yes, most likely.

Without a medical exam, insurers can’t get a complete understanding of your health and medical history. To cover their own risk, they charge higher premiums for no-exam policies. There are two types of policies on offer: Simplified issue and guaranteed issue.

Most insurers cap their coverage at $250,000. Unless you have a serious health issue or a family history of heart disease, diabetes or cancer, you should be eligible for coverage.

With no-exam policies, underwriters tend to check your DMV, pharmacy and Medical Information Bureau (MIB) records. Typically, the process takes up to a week, but depending on the provider, those in good health may be approved within minutes or days.

While traditional policies offer better value for your money, no-exam options are ideal for people who need coverage fast — say, to secure a business loan or fulfill a court order.

Companies that offer $250,000 coverage

Name Product Issue Ages Minimum Coverage Maximum Coverage Medical Exam Required State Availability
LadderLife™ Life Insurance
20 - 60 years old
Not available in New York
Term life insurance with no policy fees and the freedom to cancel anytime. Simple application process that can get you approved for coverage instantly.
18 - 85 years old
Depends on provider and policy
All 50 states
Compare affordable quotes from 12+ A-rated life insurance companies side-by-side.
18 - 100 years old
This life insurance broker combines technology and the human touch to match you with a policy tailored to your needs.
21 - 54 years old
Not available in New York
Affordable 2-, 10- and 20-year term life insurance policies. Instant quotes and no medical exams.
20 - 85 years old
Depends on policy.
Products and product features may not be available in all states.
This well-established life insurance provider could offer you $250,000 worth of coverage for as low as $14 per month.

Compare up to 4 providers

Bottom line

The concept behind life insurance is simple: Pay now to protect your family later. When you’re working out how much coverage to buy, carefully think about your assets and financial responsibilities. If they add up to $250,000, it’s worth looking into this kind of coverage.

Your eligibility for a $250,000 policy is also hinged on your income. Depending on your age, you’ll need to be earning $10,000 to $50,000 a year to qualify.

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2 Responses

  1. Default Gravatar
    pattiAugust 4, 2018

    can i split life insurance leave half to my spouse and half to my son

    • Avatarfinder Customer Care
      CharisseAugust 14, 2018Staff

      Hi Patti,

      Thank you for reaching out to finder!

      Yes. You can nominate multiple beneficiaries in your life insurance policy and you can also designate the percentage of the amount that each beneficiary will receive.

      Please note though that different insurance providers may have different terms and conditions so make sure you carefully read through relevant documents like the policy Terms and Conditions before making any decision. If you already have an insurance provider in mind, you may also want to speak with them directly to consult them on how to go about nominating beneficiaries.


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