Life Insurance

Life insurance can help protect your family financially if anything happens to you, but it’s important to make sure you’re not overpaying for the coverage you need. Compare life insurance quotes and find the best rates for a policy.

{"product":"life","customEventLabel":"Category Header","onCurrent":"true"}

How does life insurance work?

Life insurance is a planning tool that provides financial protection for your dependents.

The asset provides a tax-free lump sum of money which is paid to your dependent after your death. Typically, life insurance is bought so that your dependents would be able to sustain payments for bills, college tuition or other after-life expenses.

Key components of life insurance policies are:

  • Term: When buying life insurance you would choose how many years your policy will last. This will also depend on the type of life insurance that you purchase — permanent insurance has a term that will last your whole life for example.
  • Death benefit: The face value for the life insurance policy. This is the amount of money that would be paid to the beneficiary if you passed away.
  • Premiums: The monthly or annual payments that you give to the insurer to keep the life insurance policy in place. If you miss a payment or decide not to pay the life insurance policy would be canceled.

How to calculate your life insurance needs

Every individual has a different financial situation and therefore will require different life insurance needs.

When calculating your needs you should consider what the life insurance will be used for and why you may need life insurance in general.

If you are young and do not have any dependents then buying life insurance may not be a necessary purchase at this point in your life. On the other hand, if you are starting a family in which the financial livelihood of the family relies on your salary, then you may want to consider purchasing some life insurance coverage and calculate your future needs.

When beginning to calculate how much life insurance you need, you should start by adding up your current and future financial obligations. This can include obligations such as:

  • Future salaries
  • Mortgage balance
  • Debts
  • College costs
  • Funeral costs

After you have figured out your obligations, you can add up your current assets such as savings and college funds. Finally, by subtracting your current assets from the obligations you will arrive at a target amount for how much life insurance you will need. It is important to note that this is a rough estimate for coverage and it may be useful to purchase slightly more life insurance to compensate for unexpected financial situations that your dependents might face.

Types of life insurance

Life insurance companies will typically offer two different types of life insurance: term life insurance and permanent life insurance.

A term policy will last for a set period of time before expiring while permanent plans stay in effect for your entire life. Furthermore, some permanent life insurance policies will have a cash value component that will grow as you make premium payments.

Depending on your situation and what the purpose of your life insurance is, the type of life insurance that you need will change.

For example, if you are looking for a cheap policy to cover future financial obligations like college tuition, then choosing a term life insurance policy with a death benefit that matches the total tuition may be the best option. On the other hand, say you have Type 1 diabetes and have had problems with getting approved for life insurance. In this case, a permanent policy like guaranteed acceptance life insuranc may be a better option for coverage.

Term life insurancePermanent life insurance
Period of coverageSpecified term, usually one to 30 yearsLifelong
Cash valueNoYes
Average monthly premiumCheapExpensive

Average cost of life insurance policies

The cost of your life insurance policy will be dependent on a variety of factors including your health, age, occupation and if you smoke. However, the largest determinant will be if you are a smoker.

Smokers will have an average cost of life insurance that is 306% higher when compared to a nonsmoker.

Find Cheap Life Insurance Quotes in Your Area

Currently insured?
{"id":4,"isAgeFieldVisible":true,"isInsuranceTypeFieldVisible":true,"isInsuredStatusFieldVisible":true,"buttonText":"Find Insurers","customEventLabel":"","defaultZip":"","defaultProduct":"life","quoteWizardEndpoint":"https:\/\/quotes.valuepenguin.com","trackingKey":"_life-insurance?page=1","tier":"default","title":"Find Cheap Life Insurance Quotes in Your Area","vendor":"vp","style":"dropshadow","showTrustMessage":false,"trustMessage":"It's free, simple and secure."}

Average Cost of Life Insurance for Non-Smokers vs Smokers

graph comparing life insurance cost of non-smokers vs smokers
graph comparing life insurance cost of non-smokers vs smokers

Life insurance company reviews

When searching for the best cheap life insurance we would recommend getting life insurance quotes from as many insurers as possible. To aid you in this process we have provided detailed reviews of some of the best life insurance companies in the industry.

You will notice that many life insurance providers will have favorable underwriting requirements for certain individuals. For example, if you smoke you may find that Northwestern Mutual will have some of the best smoker life insurance rates available. Additionally, some insurers will specialize in certain products such as Mutual of Omaha which has one of the cheapest guaranteed whole life insurance products in the industry.

{"items":["\u003Cdiv class=\"node-teaser teaser-review block row\" \u003E\n \u003Cdiv class=\"block teaser-review--image\" \u003E\n \u003Ca class=\"block\" href=\"\/life-insurance\/colonial-penn-review\"\u003E\n \u003Cimg src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_190,q_auto,w_190\/v1\/referral_logos\/us\/life_insurance\/ZCPN\" alt=\" Image\" \/\u003E\n \u003C\/a\u003E\n \u003C\/div\u003E\n \u003Ch3 class=\"h4 teaser-review--label\"\u003E\n \u003Ca class=\"teaser-review--link\" href=\"\/life-insurance\/colonial-penn-review\"\u003E \u003C\/a\u003E\n \u003C\/h3\u003E\n\u003C\/div\u003E","\n\u003Cdiv class=\"node-teaser teaser-review block row\" \u003E\n \u003Cdiv class=\"block teaser-review--image\" \u003E\n \u003Ca class=\"block\" href=\"\/life-insurance\/northwestern-mutual-review\"\u003E\n \u003Cimg src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_190,q_auto,w_190\/v1\/referral_logos\/us\/life_insurance\/NORM\" alt=\" Image\" \/\u003E\n \u003C\/a\u003E\n \u003C\/div\u003E\n \u003Ch3 class=\"h4 teaser-review--label\"\u003E\n \u003Ca class=\"teaser-review--link\" href=\"\/life-insurance\/northwestern-mutual-review\"\u003E \u003C\/a\u003E\n \u003C\/h3\u003E\n\u003C\/div\u003E","\n\u003Cdiv class=\"node-teaser teaser-review block row\" \u003E\n \u003Cdiv class=\"block teaser-review--image\" \u003E\n \u003Ca class=\"block\" href=\"\/life-insurance\/globe-life-insurance-review\"\u003E\n \u003Cimg src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_190,q_auto,w_190\/v1\/referral_logos\/us\/life_insurance\/ZGLO\" alt=\" Image\" \/\u003E\n \u003C\/a\u003E\n \u003C\/div\u003E\n \u003Ch3 class=\"h4 teaser-review--label\"\u003E\n \u003Ca class=\"teaser-review--link\" href=\"\/life-insurance\/globe-life-insurance-review\"\u003E \u003C\/a\u003E\n \u003C\/h3\u003E\n\u003C\/div\u003E","\n\u003Cdiv class=\"node-teaser teaser-review block row\" \u003E\n \u003Cdiv class=\"block teaser-review--image\" \u003E\n \u003Ca class=\"block\" href=\"\/life-insurance\/primerica-review\"\u003E\n \u003Cimg src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_190,q_auto,w_190\/v1\/referral_logos\/us\/life_insurance\/PRIM\" alt=\" Image\" \/\u003E\n \u003C\/a\u003E\n \u003C\/div\u003E\n \u003Ch3 class=\"h4 teaser-review--label\"\u003E\n \u003Ca class=\"teaser-review--link\" href=\"\/life-insurance\/primerica-review\"\u003E \u003C\/a\u003E\n \u003C\/h3\u003E\n\u003C\/div\u003E","\n\u003Cdiv class=\"node-teaser teaser-review block row\" \u003E\n \u003Cdiv class=\"block teaser-review--image\" \u003E\n \u003Ca class=\"block\" href=\"\/life-insurance\/aig-review\"\u003E\n \u003Cimg src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_190,q_auto,w_190\/v1\/referral_logos\/us\/life_insurance\/AMGE\" alt=\" Image\" \/\u003E\n \u003C\/a\u003E\n \u003C\/div\u003E\n \u003Ch3 class=\"h4 teaser-review--label\"\u003E\n \u003Ca class=\"teaser-review--link\" href=\"\/life-insurance\/aig-review\"\u003E \u003C\/a\u003E\n \u003C\/h3\u003E\n\u003C\/div\u003E","\n\u003Cdiv class=\"node-teaser teaser-review block row\" \u003E\n \u003Cdiv class=\"block teaser-review--image\" \u003E\n \u003Ca class=\"block\" href=\"\/life-insurance\/aarp-review\"\u003E\n \u003Cimg src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_190,q_auto,w_190\/v1\/referral_logos\/us\/life_insurance\/AARP\" alt=\" Image\" \/\u003E\n \u003C\/a\u003E\n \u003C\/div\u003E\n \u003Ch3 class=\"h4 teaser-review--label\"\u003E\n \u003Ca class=\"teaser-review--link\" href=\"\/life-insurance\/aarp-review\"\u003E \u003C\/a\u003E\n \u003C\/h3\u003E\n\u003C\/div\u003E","\n\u003Cdiv class=\"node-teaser teaser-review block row\" \u003E\n \u003Cdiv class=\"block teaser-review--image\" \u003E\n \u003Ca class=\"block\" href=\"\/life-insurance\/gerber-life-review\"\u003E\n \u003Cimg src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_190,q_auto,w_190\/v1\/referral_logos\/us\/life_insurance\/ZGRB\" alt=\" Image\" \/\u003E\n \u003C\/a\u003E\n \u003C\/div\u003E\n \u003Ch3 class=\"h4 teaser-review--label\"\u003E\n \u003Ca class=\"teaser-review--link\" href=\"\/life-insurance\/gerber-life-review\"\u003E \u003C\/a\u003E\n \u003C\/h3\u003E\n\u003C\/div\u003E","\n\u003Cdiv class=\"node-teaser teaser-review block row\" \u003E\n \u003Cdiv class=\"block teaser-review--image\" \u003E\n \u003Ca class=\"block\" href=\"\/life-insurance\/new-york-life-review\"\u003E\n \u003Cimg src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_190,q_auto,w_190\/v1\/referral_logos\/us\/life_insurance\/NEWY\" alt=\" Image\" \/\u003E\n \u003C\/a\u003E\n \u003C\/div\u003E\n \u003Ch3 class=\"h4 teaser-review--label\"\u003E\n \u003Ca class=\"teaser-review--link\" href=\"\/life-insurance\/new-york-life-review\"\u003E \u003C\/a\u003E\n \u003C\/h3\u003E\n\u003C\/div\u003E","\n\u003Cdiv class=\"node-teaser teaser-review block row\" \u003E\n \u003Cdiv class=\"block teaser-review--image\" \u003E\n \u003Ca class=\"block\" href=\"\/life-insurance\/ladder-life-review\"\u003E\n \u003Cimg src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_190,q_auto,w_190\/v1\/referral_logos\/us\/life_insurance\/ZLAD\" alt=\" Image\" \/\u003E\n \u003C\/a\u003E\n \u003C\/div\u003E\n \u003Ch3 class=\"h4 teaser-review--label\"\u003E\n \u003Ca class=\"teaser-review--link\" href=\"\/life-insurance\/ladder-life-review\"\u003E \u003C\/a\u003E\n \u003C\/h3\u003E\n\u003C\/div\u003E","\n\u003Cdiv class=\"node-teaser teaser-review block row\" \u003E\n \u003Cdiv class=\"block teaser-review--image\" \u003E\n \u003Ca class=\"block\" href=\"\/life-insurance\/aaa-review\"\u003E\n \u003Cimg src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_190,q_auto,w_190\/v1\/referral_logos\/us\/life_insurance\/AAAL\" alt=\" Image\" \/\u003E\n \u003C\/a\u003E\n \u003C\/div\u003E\n \u003Ch3 class=\"h4 teaser-review--label\"\u003E\n \u003Ca class=\"teaser-review--link\" href=\"\/life-insurance\/aaa-review\"\u003E \u003C\/a\u003E\n \u003C\/h3\u003E\n\u003C\/div\u003E"],"offsetPercentage":20}

Life Insurance Research & Analysis

Insurance Expert Q&A with Ray Caucci, Chairman and CEO of Vantis Life Insurance Company

Vantis Life is aiming to challenge how people think about life insurance; enforcing that planning for the future is not an uncomfortable... Read More

Senior Care USA Life Insurance Review

Senior Care Life provides life insurance brokerage services and is affiliated with many A-rated life insurance carriers. Most of the... Read More

What Is the Best Burial Insurance for Seniors?

Senior burial insurance is a whole life insurance plan designed to provide coverage for end-of-life expenses. Read on to learn about which... Read More

Best Life Insurance for Seniors over 60

Life insurance for seniors over 60 can be a valuable tool to provide financial security for your loved ones. Typically, this product is... Read More

Best Life Insurance for Children

Child life insurance is a whole life policy that pays a death benefit if your child or baby passes away and provides them guaranteed... Read More

Insurance Expert Q&A with Ladder CEO and founder, Jamie Hale

ValuePenguin recently had the opportunity to speak with Jamie Hale, the CEO and founder of life insurtech Ladder. As a private equity... Read More

MassMutual Life Insurance Review: Great Financial Strength and Good Simplified Issue Insurance Policies

MassMutual is a life insurance provider that offers competitive rates for term and permanent life insurance. The company has excellent... Read More

FastLife Insurance Review: Fast Coverage but Comes With Extra Broker Fees

FastLife Insurance brokerage provides a variety of financial planning services including life insurance. You can get fast coverage and... Read More

State Farm Life Insurance Review: Quality Service and Policies Backed by a Financially Stable Company

State Farm offers basic term and permanent life insurance with competitive rates. Customer reviews for State Farm are very positive with... Read More

Protective Life Insurance Review: Cheap Term Policies and Easy-to-Use Online Portal

Protective offers some of the cheapest term life insurance quotes, as well as a variety of permanent insurance products, but if you smoke,... Read More

Ethos Life Insurance Review: Fast Approval for Coverage and Flexible Policy Options

Ethos offers term life insurance that is quick to apply for and has added flexibility in that it offers a variety of policy riders. The... Read More

What is a Reduced Paid-Up Life Insurance Policy Option?

Insurers that offer whole life insurance usually provide three nonforfeiture options: reduced paid-up insurance, cash surrender and... Read More