Cheapest Life Insurance Companies of 2022

Purchasing life insurance is a smart way to provide for your loved ones financially in the event of your death. Having a good policy in place ensures that you’re doing so in a cost-effective way and the insurer will have enough funds to pay the agreed-upon death benefit.

It’s possible to choose the lowest premiums for your individual circumstances by shopping around for coverage. Take a look at our list of the cheapest life insurance companies to help you find the best fit for your budget.

#1 Banner Life
#2 AIG
#3 Guardian Life
#4 State Farm
#5 Transamerica

Life insurance policies vary in price because of factors that affect your risk level in the eyes of insurers. The riskier your profile, the more likely you are to pay a higher premium. In other words, the more likely it is that the insurer will need to pay out claims, the more they’ll charge.

Below are some factors that determine how much you will pay for life insurance:

  • Coverage amount: The higher your death benefit, the higher your rates
  • Policy type: Term life insurance is generally cheaper than permanent life insurance policies because you’re not building cash value.
  • Term length: If you purchase a term life insurance policy, you will pay more for longer terms.
  • Gender: Men tend to have higher life insurance costs compared to women because they don’t live as long.
  • Health or medical history: Smokers tend to pay higher premiums compared to nonsmokers, as well as those who have a higher risk of pre-existing and future medical conditions. Other health factors may also be taken into consideration, such as your current health, weight, and cholesterol levels.
  • Age: The older you are, the more likely it is you will be charged higher premiums.
  • Lifestyle factors: If you generally live a risker lifestyle (if you have hobbies that involve potentially dangerous activities) or have a high-risk job, you might pay more.

Life insurance policies vary in price because of factors that affect your risk level in the eyes of insurers. The riskier your profile, the more likely you are to pay a higher premium. In other words, the more likely it is that the insurer will need to pay out claims, the more they’ll charge.

Below are some factors that determine how much you will pay for life insurance:

  • Coverage amount: The higher your death benefit, the higher your rates
  • Policy type: Term life insurance is generally cheaper than permanent life insurance policies because you’re not building cash value.
  • Term length: If you purchase a term life insurance policy, you will pay more for longer terms.
  • Gender: Men tend to have higher life insurance costs compared to women because they don’t live as long.
  • Health or medical history: Smokers tend to pay higher premiums compared to nonsmokers, as well as those who have a higher risk of pre-existing and future medical conditions. Other health factors may also be taken into consideration, such as your current health, weight, and cholesterol levels.
  • Age: The older you are, the more likely it is you will be charged higher premiums.
  • Lifestyle factors: If you generally live a risker lifestyle (if you have hobbies that involve potentially dangerous activities) or have a high-risk job, you might pay more.

 

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Understanding exactly how much life insurance you need will ensure your loved ones are taken care of when you’re not around. There is the possibility though, that you could purchase too much life insurance, leading you to pay more in premiums that won’t do much financial good.

Determining how much you need will depend on your individual circumstances, including the following:

  • You and your family’s current and potential income, assets, and liabilities
  • The number of dependents you have, plus their future financial needs
  • The loss in income your loved ones will face without your contributions
  • Out-of-pocket costs relating to end-of-life expenses, such as funeral costs, estate taxes, and outstanding debt

The Insurance Information Institute (III) suggests also looking at less obvious sources of income outside of your salary, such as the value of employee benefits like health insurance subsidies and employer 401(k) matches. Once you’re gone, your loved ones will need to make up for these losses if they want to maintain the same standard of living.

Calculating the coverage amount you’ll need is an important first step before purchasing a policy. Once you have this amount, you can then look at policies that match your needs, including how much you can afford to spend on premiums.

 

Pros

  • Employer subsidizes policies

  • Paperwork may be easier than purchasing an individual policy

  • Typically has guaranteed acceptance regardless of age or health status

Cons

  • Coverage amount tends to be low

  • Limited customization options

 

Some employers and member-based organizations offer group life insurance as one of their benefits. This type of life insurance is an agreement between the employer or group and its employees or members, stating that it’ll provide life insurance policies

A main benefit of group life insurance policies is that they’re paid for by the employer and guarantee coverage. However, if you want to customize your coverage, you may have to pay out of pocket. Plus, your coverage amount may be limited to a certain amount of your salary.

If you want additional coverage, you may need to purchase another policy to ensure you have enough to provide for your loved ones if you die. According to LIMRA, a financial industries association, the median coverage for life insurance provided through the workplace is either a $20,000 flat sum or one year’s salary.

Another disadvantage is that group policies are usually tied to your job. If you leave, you won’t be able to take it with you. There are some insurance companies that allow you to convert a group policy to an individual one, but you’ll need to pay your own premiums.

Considering group life policies are usually provided at no cost to you, it may be a smart idea to take advantage of this benefit. That being said, you may need to purchase an additional or supplemental policy to ensure you’ll have coverage if you leave your job or want to increase your overall death benefit.

The chart below shows a sampling of monthly rates for life insurance policies for females. In general, the younger and healthier you are, the lower you’ll pay in premiums. Plus, whole life and universal life insurance policies usually cost more than term life policies.

 

Life insurance generally costs more for males than females because of life expectancy statistics from sources such as the Centers for Disease Control and Prevention (CDC). Still, you can purchase a policy with the cheapest rates by shopping around with different insurance carriers and comparing different policies.

 

Purchasing life insurance later in life may be a smart choice if you don’t want to burden your loved ones with any outstanding debt or funeral expenses. Yes, life insurance may be more expensive the older you get, but there are ways to save on premiums.

Here are some options to look at if you’re a female and want to find the lowest cost for your policy.

 

Life insurance for men who are older may be more expensive depending on factors such as health conditions and death benefit amount. To help you save as much as possible, it’s a smart idea to shop around with different insurance carriers.

Take a look at the table below to see our picks for the top five cheapest life insurance policies for males.

 

Life insurance for smokers may cost more compared to nonsmokers. Premiums also depend on other factors such as your gender, age, health condition, and how often you smoke.

Take a look at the table below to see a range of premiums you might pay if you’re a female.

 

While life insurance policies for men are generally more expensive, the same factors for females will also affect how much you pay. You can see a sampling of life insurance rates for male smokers in the table below. Note the difference between preferred versus standard smoker rates. The healthier you are, the more likely you are to pay less for your policy.

 

Life insurance for children is a type of whole life policy, giving parents, legal guardians, and grandparents the opportunity to provide death benefit coverage and build cash value. Depending on the policy, policyholders can help the insured child lock in premiums, guarantee coverage as an adult, and invest for the future.

There are also children’s insurance riders you can add to your existing coverage. Premiums depend on several factors including the child’s age, state of residence, and coverage amount. You can add children’s insurance riders to different types of policies including term, whole, universal, and variable insurance.

 

There are several ways to lower your life insurance premiums:

  • Consider term life insurance. This type of policy is generally less expensive compared to permanent life insurance because your premiums don’t go towards building cash value. If you want to invest, however, you’ll need to look at other alternatives such as putting money in your employer-sponsored retirement plan or a brokerage account.
  • Lower your death benefit. Decreasing the amount of coverage might increase your chances of getting a lower premium. Whatever amount you choose, you’ll want to make sure that you’ll still be able to provide enough for your beneficiaries.
  • Bundle policies. Many insurance companies offer discounts if you have a multi-line policy. For instance, if you purchase an auto and life insurance policy from the same insurer, your premium may go down.
  • Select the most cost-effective payment schedule. Some insurers offer a discount if you pay upfront, whether that’s annually, quarterly, or semi-annually. If you’re concerned that you may not be able to make a larger upfront payment, then monthly premiums may be your best bet, even if you may not save on premiums.
  • Opt out of extras. Some policies have life insurance riders or other add-ons to customize coverage. Even though they may offer more protection, the additional cost may not be worth it. Take your time to research which riders you may want and determine whether you really need the additional coverage.

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