How much is online term life insurance?

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Planning for your future includes preparing for the unexpected and ensuring your loved ones are provided for financially after your death. Covering a mortgage, paying down debts and maintaining college tuition funds are a few essential expenses to consider. This is where purchasing an online term life insurance policy can be beneficial.

Learn more about term life insurance, including coverage, the best online term life insurance premiums and how personal factors impact rates.

Key Takeaways

Online term life insurance is ideal for individuals seeking affordable financial protection for their beneficiaries after their death.
Childcare and education expenses, debts, funeral costs, loans, rent and mortgages can all be paid for with the death benefit from an online term life insurance policy.
A 25-year-old, nonsmoker female will pay an average $17 monthly premium for a 20-year, $500,000 policy.

What is online term life insurance?

Term life insurance is a policy that provides coverage for a specific period, typically 10 to 30 years. It’s an ideal protection plan for families or individuals seeking financial coverage for short-term obligations such as business loans, childcare and everyday expenses. It provides a cash benefit to beneficiaries if the policyholder dies before the term ends.

When it comes to life insurance basics, there are two types: permanent and term. Unlike permanent options, term life insurance doesn’t offer a savings or investment component. It’s an affordable option with low rates for those seeking financial coverage for their loved ones.

How does online term life insurance work?

Like purchasing any insurance, you agree to receive specific benefits and coverage from an insurance company in return for paying your premiums. In this case, you’re determining what financial coverage will be payable in the event of your death.

Online term life insurance provides your beneficiaries with a death benefit — a set amount of money — paid out after your death. For example, if you purchase $300,000 in term life insurance coverage, your beneficiaries will receive that amount upon your death within the term. However, if you outlive your policy term, your coverage will end and you’ll need to purchase another plan.

Since your death benefits are a cash payout, they can be used to cover the following expenses and more:

Debts (credit cards, loans, utilities)
Childcare
Education expenses
Funeral costs
Loss of income
Mortgage

Lifestyle impacts

Insurers consider risk factors when determining premiums. For term life insurance policies, the following lifestyle choices can impact how much of a premium you will pay:

Age: The younger you are, the longer you tend to live. This is why premiums in your 20s are typically lower than in your 40s.
Driving record: Any violations on your driving record may raise a risk red flag affecting your premium. You may see an increase based on any infractions you’ve received in the past five years.
Health history: In the eyes of an insurer, your health history directly correlates to the likeliness of premature death. You could see a spike in premiums based on chronic illnesses, poor general health or if you opt not to have a medical exam as part of your policy application.
Hobbies: You may only live once, but if you indulge in high-risk living, such as skydiving, scuba diving, auto racing or flying private planes, you may be looking at higher premiums. This is also true if your profession is high-risk like police and fire officers, construction workers and aviation workers.
Gender: Statistically, women tend to live longer than men, which may mean they pay less for life insurance coverage. Men may also be involved in more high-risk activities or professions than women.
Smoking: Smokers often pay more for life insurance than nonsmokers, as insurers view this as a significant health risk. In the cost tables below, you can compare the cost differences between smokers and nonsmokers.

What are the differences between online term life and whole life insurance?

Term life insurance is affordable, temporary and short-term financial protection. Whole life insurance can last your entire lifetime, offers a cash value savings component and often has more expensive premiums.

When determining which life insurance option is best for you, take a moment to consider your needs. Are you in your 20s but want to start a life insurance savings? Are you the breadwinner for your family and are worried about what will happen to your loved ones when you die? Do you have significant health issues and don’t want to leave your dependents with your debts?

If you’re in your 20s, you may want to start a whole life insurance policy. However, if you’re seeking to cover your financial obligations and provide your dependents financial support after your death, term life may be a better option for you.

Cheapest online life insurance companies

When it comes to online term insurance costs, premiums are often based initially on your age, health and lifestyle choices, policy term and death benefit amount. The following are some of the cheapest online life insurance companies broken down by 15- and 20-year terms and range in limits from $300,000 to $1 million.

Most companies don’t write 20-year term life policies for 55-year-olds, which is why you’ll see that age group only in the data for 15-year term life policies.

Remember, shopping around often helps you save on premiums. Getting several term life insurance quotes online is advisable to ensure you find the best price for your needs. All premiums listed below are rated on a monthly basis.

Average rates for 15-year term life insurance: $500,000

A 15-year term policy with a $500,000 limit is about $20 more expensive than a 10-year for a 55-year-old, non-smoking male at an average of $113. It’s $11 more expensive on average for a 55-year-old, non-smoking female.

The cheapest life insurance company in our dataset is Lemonade, with average monthly rates starting at $78.

	Bestow	Ladder	Sofi	Lemonade
55-year-old male, nonsmoker	$159	$116	$116	$113
55-year-old female, nonsmoker	N/A	$78	$78	$81
55-year-old male, smoker	$764	$396	$456	$690
55-year-old female, smoker	$479	$262	$301	$478

Cheapest average rates for 15-year term life policies: $1 million

Increasing your term life insurance coverage from $500,000 to $1 million will have a 55-year-old, nonsmoker male paying $105 on average more monthly. However, a 55-year-old, non-smoking female will only see an average $53 increase.

The most affordable life insurance companies for a 15-year, $1 million policy are Ladder and Sofi, starting at $131.

	Bestow	Ladder	Sofi	Lemonade
55-year-old male, nonsmoker	$311	$218	$218	$220
55-year-old female, nonsmoker	N/A	$131	$131	$156
55-year-old male, smoker	$1,520	$779	$896	$1,374
55-year-old female, smoker	$749	$491	$564	$950

Cheapest average rates for 20-year term life insurance: $300,000

Trustage offers an average 20-year term life insurance policy at $300,000 if you seek a slightly lower death benefit amount. For young, non-smoking females, policies start at $56. They can range as high as $377, based on age and smoking status.

Additionally, Trustage only provides rates for a $300,000 policy. Rates are broken down into five-year increments because, while the company offers policies to many ages, their Simplified Issue Term Life Insurance policies expire at age 80, and rates are automatically adjusted every five years.

	Trustage
25-year-old male, nonsmoker	$92
25-year-old female, nonsmoker	$56
35-year-old male, nonsmoker	$98
35-year-old female, nonsmoker	$80
45-year-old male, nonsmoker	$185
45-year-old female, nonsmoker	$122
55-year-old male, nonsmoker	$377
55-year-old female, nonsmoker	$266

Cheapest average rates for 20-year term life insurance: $500,000

Based on age and health factors, young women and men can find policy average premiums for as low as $12 and $19, respectively. If you’re a 25-year-old smoker, you’re looking at about $30-39, with the highest premium for a smoker (55-year-old male) at $774, on average.

The most affordable 20-year term life insurance company with a $500,000 limit is Wyshbox, with premiums starting on average at $12 for 25-year-old, non-smoking females.

	Bestow	Ethos	Fabric	Haven Life	Ladder	Lemonade	SoFi	Sproutt	Wyshbox
25-year-old male, nonsmoker	$37	$21	$23	$19	$21	$29	$24	$24	$21
25-year-old male, smoker	$95	$39	$97	$51	$65	$101	$74	$84	$57
25-year-old female, nonsmoker	$18	$16	$19	$15	$18	$18	$21	$20	$12
25-year-old female, smoker	$50	$30	$70	$39	$41	$56	$47	Session Req.	$47
35-year-old male, nonsmoker	$36	$25	$24	$21	$22	$30	$25	$30	$30
35-year-old male, smoker	$153	$46	$129	$90	$94	$138	$108	$109	$112
35-year-old female, nonsmoker	$26	$28	$21	$18	$19	$23	$22	$23	$21
35-year-old female, smoker	$85	$36	$105	$61	$74	$86	$85	$93	$73
45-year-old male, nonsmoker	$88	$57	$71	$42	$58	$58	$67	$67	$54
45-year-old male, smoker	$328	$106	$407	$211	$208	$301	$239	$284	$236
45-year-old female, nonsmoker	$60	$44	$57	$36	$46	$44	$53	$50	$40
45-year-old female, smoker	$202	$80	$312	$153	$164	$220	$189	Session Req.	$180

Cheapest average rates for 20-year term life insurance: $1 million

Increasing your 20-year term life insurance policy to a $1 million death benefit will increase your premium. On average, premiums increase from $8 to $107 for females and $12 to $146 for men, based on age when the policy is started and health factors.

The cheapest 20-year term life insurance company for $1 million is Wyshbox, with premiums starting at an average of $20 for non-smoking females. For males, it’s $31 for 25-year-old nonsmokers from Haven Life.

	Bestow	Ethos	Fabric	Haven Life	Ladder	Lemonade	Sofi	Sproutt	Wyshbox
25-year-old male, nonsmoker	$66	$37	$39	$31	$35	$51	$41	$44	$38
25-year-old male, smoker	$183	$70	$187	$94	$119	$196	$137	$163	$115
25-year-old female, nonsmoker	$29	$24	$32	$23	$29	$29	$34	$36	$20
25-year-old female, smoker	$94	$52	$133	$69	$71	$106	$82	Session Req.	$82
35-year-old male, nonsmoker	$66	$46	$41	$34	$37	$54	$42	$57	$58
35-year-old male, smoker	$299	$84	$251	$172	$173	$270	$199	$213	$221
35-year-old female, nonsmoker	$47	$36	$35	$29	$32	$39	$37	$43	$41
35-year-old female, smoker	$163	$62	$203	$112	$137	$167	$157	$181	$144
45-year-old male, nonsmoker	$169	$106	$126	$80	$104	$109	$119	$130	$101
45-year-old male, smoker	$648	$197	$782	$414	$397	$595	$456	$565	$468
45-year-old female, nonsmoker	$115	$83	$97	$67	$80	$83	$92	$97	$78
45-year-old female, smoker	$302	$149	$605	$299	$310	$434	$357	Session Req.	$357

How to buy term life insurance online

Shopping for term life insurance online is an affordable and straightforward option that doesn’t require talking to an insurance agent. You can shop around by requesting online term life quotes from several life insurance companies who will likely follow up with you to determine your policy.

However, you can also apply online with a company that matches your needs and activate your coverage once your application is reviewed. The insurer may still contact you to confirm and review your information. Often, you can complete your online term life insurance policy on the same day.

Premium payments are made monthly and remain the same throughout the policy term. For example, if you select a $500,000, 20-year term life insurance policy for $50 a month, you likely will continue to pay $50 a month until the policy ends.

Purchasing considerations

As easy as purchasing life insurance online may be, it can be confusing to determine what to include in your policy. Prior to shopping for quotes, take a moment to consider what you want and need. While a large policy limit may seem like the best choice, you must consider what you can afford over the next 10 to 30 years and what financial coverage you may need.

Beneficiaries: There is peace of mind knowing your finances won’t burden your loved ones when you die. Choosing who your death benefit goes to is crucial. You should leave it to responsible parties and those who need it the most when you’re gone. It may be beneficial to state within your will how the death benefit will be distributed.
Debts and daily expenses: Review your current financials, debts, daily expenses, estimated funeral costs and what you will likely be paying for the next 10 years or longer. You should also factor in your occupation and earning potential. This can help you identify how much you may need in coverage and what amount you can afford for your monthly term life premium.
Lifestyle factors: Consider your lifestyle, hobbies, health and other risk factors that may impact your premiums. It may be a good time to adjust some of your behaviors if it will cost you more in the long run.

Frequently asked questions

Who would benefit from online term life insurance?

Term life insurance policies are best for individuals seeking coverage at an affordable rate. This type of coverage is often sought for financial needs during a certain period of time — childcare, education, rent or mortgage and everyday expenses — after the policyholders’ death. This does not offer lifetime coverage, savings or investment component or cash value that can be borrowed against while the policyholder is alive.

How much is online term life insurance?

Average rates vary based on term length and limit, age and health factors. Typically, non-smoking females pay less for life insurance than men and younger individuals will save more than those in their 40s to 50s. Haven Life policies, for example, start at $15 for 20-year term life policies with a $500,000 limit for 25-year-old female non-smokers.

How can I find affordable online term life insurance?

Shop around by requesting quotes from several companies to determine the best fit for your needs. It’s essential you know what coverage and terms you require, your risk factors and what you can afford monthly through the life of the policy.

You can also request quotes for different terms and limit amounts if your quotes are coming in too high. You can inquire about bundling life insurance with your current auto and home insurance provider to see what discounts and cost savings are available.

Resources & Methodology

Sources:

Ethos. “Term life insurance policies.” Accessed July 2023.

Haven Life. “8 factors that impact life insurance premiums.” Accessed July 2023.

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Katrina Raenell

Contributing Researcher

Katrina Raenell is a writer, editor and educator with 20 years of experience in content and communications for international organizations, nonprofits and start-ups. In her previous roles, she was a communications manager for study abroad, content project manager for higher education and finance websites, reported on arts and culture, and was a managing editor for an online health and wellness publication.