Do you need life insurance? For many people, the answer is yes.
If you have children who are still minors or a mortgage, life insurance offers financial security for your family. Even if no one relies on your income, there will still be costs associated with your death such as burial and other end-of-life expenses. As you consider whether to buy life insurance, think about your loved ones and what they’ll need after you’re gone.
For most people, we recommend a term life insurance policy. Why? Term life is predictable and affordable, and it can cover the years you have the most financial responsibilities. Since it's simpler than other types of life insurance, you can get term life insurance quotes quickly and easily online. Some term policies go into effect instantly.
How much does life insurance cost?
The average cost of life insurance is $26 a month, according to Policygenius, a life insurance brokerage. This is based on a 40-year-old in good health buying a 20-year, $500,000 term life policy, which is the most common term length and amount sold.
Life insurance costs are mostly based on your age, gender, health and smoking status, but other factors like your occupation and hobbies can also affect the price. In general, the younger and healthier you are, the less you'll pay for life insurance. As you age, your life expectancy shortens, so your insurer faces a greater risk of having to pay out your policy.
Here's a sample of what term life insurance might cost based on the most influential factors.
Your rate is also based on your current health. This includes whether you have pre-existing conditions, blood pressure and cholesterol levels, height and weight, and your family medical or prescription use history.
If you're in excellent health and have never smoked, you might qualify for preferred plus rates. Preferred rates still mean you're in good health, although there may be some slight concerns about weight, blood pressure or cholesterol.
The average person qualifies for standard rates. This is usually due to weight, elevated blood pressure or the death of one parent or sibling before age 60 from heart disease or cancer.
Age and gender
Preferred plus
Preferred
Standard
Woman, 20
$175
$209
$318
Woman, 30
$182
$211
$328
Woman, 40
$278
$336
$491
Woman, 50
$636
$750
$1,130
Woman, 60
$1,640
$1,876
$2,929
Woman, 70
$7,953
$8,882
$11,034
Man, 20
$210
$240
$372
Man, 30
$213
$271
$396
Man, 40
$321
$405
$631
Man, 50
$810
$966
$1,481
Man, 60
$2,331
$2,633
$4,161
Man, 70
$9,702
$10,988
$14,544
Source: LifeStein.com. Lowest three rates for each age averaged. Data valid as of Aug. 1, 2026, and rates are subject to change.
Since smokers are at a higher risk of developing health issues, life insurance for smokers is more expensive. A NerdWallet analysis found that a 40-year-old male smoker could expect to pay more than three times what a 40-year-old nonsmoker would for a $500,000, 20-year term life policy.
If you're a smoker in good health or have recently quit, you might qualify for preferred rates. The average smoker qualifies for standard life insurance rates.
Age and gender
Preferred
Standard
Woman, 20
$554
$652
Woman, 30
$645
$790
Woman, 40
$1,157
$1,420
Woman, 50
$2,560
$3,390
Woman, 60
$6,001
$7,675
Woman, 65+
$9,809
$12,554
Man, 20
$744
$790
Man, 30
$795
$975
Man, 40
$1,455
$2,030
Man, 50
$3,495
$4,365
Man, 60
$8,435
$10,945
Man, 65+
$13,160
$14,852
Source: LifeStein.com. Lowest three rates for each age averaged. Data valid as of Aug. 1, 2026, and rates are subject to change.
Risky jobs or hobbies — think firefighting or skydiving — could also lead to higher premiums. Behaviors that place you at risk are also a factor in determining life insurance rates.
For instance, it’s a red flag for insurers if you have DUIs or multiple traffic violations. And if you have a history of alcohol or drug abuse, you may be denied coverage entirely.
When should you compare life insurance quotes?
Term life rates don't vary much across companies for a young, healthy person. But they can be dramatically different if you apply later in life or have a health condition.
Some insurers are more lenient toward smokers or those who can prove they're managing a health condition well. The same goes for medical exams: choosing to take one can lower your rate because it helps insurers feel more confident about the risk of insuring you.
To get the lowest possible price, we recommend comparing three to five quotes. You'll get the most accurate price estimate if you enter as many details as you can about your health and lifestyle.
Shopping for life insurance with NerdWallet
Finding your best price is as simple as a few steps:
Tell us a bit about you and your health.
Get estimated rates from our partner Policygenius.
A few more questions, and then receive your quote.
The process takes a matter of minutes. And depending on the type of coverage, you may be able to compare quotes and buy a policy the same day.
How to shop for life insurance
1. Choose a policy type
There are two main types of life insurance: term and permanent.
Term life insurance is simple and inexpensive — often the cheapest type of life insurance. It's sufficient for most people and covers the years when you'd have the most financial obligations.
Permanent life insurance is designed to last your entire life. It typically costs more than term life, but it offers features like cash value that grows over time. Whole life insurance is the most popular type of permanent life insurance.
» MORE: Term vs. whole life insurance
What kind of term life insurance should I choose?
Term life is the most straightforward and affordable option. It's useful if you need coverage for a set number of years, such as while raising kids or paying off a mortgage. If you die during this timeframe, the policy pays out to your beneficiaries. If you outlive your policy, coverage ends and no one gets paid.
Most term policies are "level," meaning the premiums and death benefit stay the same for the life of the policy. But if you need more flexibility, there are other options:
This type of policy is for short-term coverage. It renews every year, and premiums generally go up each time.
With this term policy, the death benefit goes up or down. It’s often used to cover a debt or account for future financial needs.
Is permanent life insurance a good fit?
With permanent life insurance, a portion of the premiums you pay goes toward the policy’s cash value. It earns interest over time at either a fixed or variable rate. However, permanent policies like whole life insurance can be six to ten times more expensive than term life insurance.
Once you've built up enough, you can use the cash value of your life insurance while you’re still alive. Depending on the policy, you might be able to borrow from your cash value, make withdrawals or use it to cover your premiums. If you no longer need coverage, you can also cash in your policy.
The way the policy’s cash value grows is the main difference between these types of permanent life insurance:
The most popular type of permanent coverage, whole life offers level premiums, a guaranteed death benefit and cash value that grows slowly.
A type of whole life insurance, this is a small policy designed to cover final expenses, like your funeral and end-of-life medical care.
With universal life insurance, you may be able to adjust your premiums and death benefit as your needs change. This insurance has more cash value growth than whole life insurance, but it’s generally limited to an interest rate set by the insurer.
Similar to universal life, indexed universal life (IUL) and variable universal life (VUL) offer flexible coverage. Unlike standard universal life policies, the cash value growth is typically based on the performance of a stock index, like the S&P 500. We don’t recommend these types of life insurance due to the complicated product features and greater risk of policy lapse.
2. Calculate how much coverage you need
To decide how much life insurance you should buy, start with your current and long-term financial obligations. Aim to take out a policy that covers not just the amount but the length of those commitments.
Step 1: Add up major expenses like a mortgage or any educational expenses you expect to pay.
Step 2: Multiply your annual salary by the number of years any dependents would need to be supported by your income.
Step 3: If you have significant savings or another nest egg, you can subtract those funds or assets from the amount you’ve calculated above. (However, note that your estate will usually need to be settled in court before anyone will have access to that money.)
You'll want to get quotes for the same level of coverage — for example, $500,000 — to compare easily. Not sure how much coverage you need? Our calculator can help.
Consider adding riders to your policy
Riders are extras you can tack on to a life insurance policy to customize coverage. These are a few common life insurance riders:
Accelerated death benefit: Lets you access part of the death benefit if you have a terminal illness.
Child term: Adds a child or multiple children to your policy.
Guaranteed insurability: Allows you to buy more coverage in the future without an exam.
Waiver of premium: Pauses your premiums if you’re disabled and unable to work.
See our full guide to life insurance riders.
3. Get multiple quotes
Get quotes from three or four insurance companies to find the best price. You can get quotes in several ways:
Online
Most insurers offer life insurance quotes online. You can also use tools like NerdWallet to compare multiple quotes in one spot — cutting the hassle of visiting several sites.
Direct from the insurer
If you know which companies you'd like to compare, many insurers let you answer a few questions to get a quote online. Other insurers offer agents that you can work with over the phone or in person.
Through agents or brokers
An independent life insurance agent or broker identifies options and can help you apply. However, some agents or brokers only give quotes from insurers they partner with.
Helpful life insurance terms
You might see these terms as you compare quotes. Here's what they mean.
Permanent life insurance policies typically have a savings portion that increases in value over time. This is known as the cash value. Once you’ve accumulated enough cash value, you may be able to withdraw money from or borrow against your policy.
The face amount is the basic value or death benefit of the policy. For example, if you buy a $500,000 policy, the life insurance face value is $500,000. In most cases, that's the amount of money that will be paid out to your beneficiaries.
The amount of money you’ll pay to keep your life insurance policy active. With most policies, you have the choice to pay monthly, quarterly, semiannually or annually.
A rider is an optional add-on to your policy that can be used to customize your coverage. Some life insurance riders, such as an accelerated death benefit, are automatically included while others may only be available for a fee.
Life insurance underwriting is the process an insurer uses to gather information about you, determine the risk of insuring you and set the price you’ll pay for a policy.
4. Consider the companies
You may be tempted to buy the cheapest policy, but it’s worth taking a few minutes to compare options. Below are a few other factors to weigh besides price.
Financial strength. You want to make sure the insurer will be around to pay out your policy years or decades into the future. Financial strength ratings from agencies like AM Best can help you gauge a company’s stability. NerdWallet recommends companies with an AM Best rating of A or higher.
Consumer complaints. You can find consumer complaint information on the National Association of Insurance Commissioners website. NerdWallet’s life insurance reviews also include information on consumer complaints.
Policy features. Even if they have the same face value and term length, there may be key differences between the policies. Maybe one costs more because it includes riders or can be converted to a permanent policy. In cases like these, a policy that looks more expensive could provide better value.
Customer service. Consider how easy it is to contact the insurer. Does it have a 24-hour customer phone line or chat? Note if you can update beneficiaries or pay online.
5. Decide if you’re willing to take a medical exam
Most life insurance applications include questions about your health, such as whether you smoke and how much you weigh. Some also require giving urine and blood samples as part of an in-person life insurance medical exam.
Looking for a quicker, less intensive process? Some companies sell instant life insurance. These insurers still ask health and lifestyle questions. But if you qualify, they may approve and issue your policy the same day — no exam needed.
Another option is guaranteed issue life insurance, which skips both the health questionnaire and medical exam. You'll get issued coverage, no questions asked. These policies cost more and are best for older adults who need final expense coverage.
No-medical-exam policies may be appealing to people who have health issues or need coverage in a hurry. But if you’re in good health, you’ll probably get lower rates and more coverage by taking a medical exam.
6. Apply for coverage
When you’re ready to lock down your policy, you can complete your life insurance application. Whether you apply for life insurance online, in person or over the phone, you may need to provide your Social Security number, driver’s license number and current medications.
Depending on the company and policy type, the process may include a medical exam. Always be honest on your application. If the insurer finds out that you’ve given false information, it can cancel your policy or refuse to pay your death benefit.
You'll be asked to select your beneficiaries and decide on a payment schedule for your premiums (such as annually or monthly). It can take a few weeks for your policy to be approved and issued. Review the final documents carefully to make sure details like the coverage amount, riders and beneficiaries are correct.
Once you’ve reviewed your policy, don’t just throw it in a drawer for the next 20 years. Update your beneficiaries if you get divorced, buy a home or if you have another child.
Remember: When your life changes, your life insurance policy needs to change, too. If you have a permanent policy, check on how the cash value is performing on a regular basis, too.
Best life insurance companies
Company | NerdWallet rating | What you'll pay per month for term life insurance |
|---|---|---|
Guardian Best term and overall | Female: $26 Male: $31 | |
USAA Best for veterans | Female: $37 Male: $32 | |
New York Life Best for seniors | Female: $30 Male: $36 | |
Northwestern Mutual Best universal life insurance | Female: $38 Male: $40 | |
MassMutual Best for permanent life insurance | Female: $30 Male: $36 | |
Lemonade Best for instant coverage | Female: $24 Male: $28 |
Company | NerdWallet rating | What you'll pay per month |
|---|---|---|
Guardian Best for health conditions | Female: $26 Male: $31 | |
USAA Best for military members | Female: $37 Male: $32 | |
New York Life Best for renewable policies | Female: $30 Male: $36 | |
Northwestern Mutual Best for customer experience | Female: $38 Male: $40 | |
Thrivent Best for conversion options | Female: $31 Male: $37 |
Company | NerdWallet rating | What you'll pay per month |
|---|---|---|
Guardian Best for health conditions | Female: $691 Male: $760 | |
USAA Best for boosting coverage | Female: $397 Male: $416 | |
New York Life Best for custom coverage | Not available. | |
Northwestern Mutual Best for hybrid whole life policies | Female: $661 Male: $731 | |
MassMutual Best for cash value growth | Female: $588 Male: $706 |
About these picks: NerdWallet compared over 50 life insurance companies’ financial strength, customer complaint rates, availability of policy details and ease of communication. Above are the companies that earned the highest scores, along with how much you can expect to pay for a policy worth $500,000 if you're a healthy nonsmoker.
Term life insurance is the simplest and most affordable type of coverage, and it's a good fit for most people in the market for life insurance.
How we rate the best life insurance companies
✅ 445 life insurers reviewed
📝 210 policies assessed
🔢 1,515 data points analyzed
📊 Star rating categories
When NerdWallet evaluates life insurance companies, our editorial team considers the insurer's strengths and weaknesses, as well as the things that matter most to customers buying a long-term financial product. We then weigh these factors carefully:
💰 Financial strength (35%). We use AM Best ratings to confirm an insurer’s financial stability and ability to pay claims far into the future. The top life insurance companies have an exceptional financial strength rating of A+ or A++ (Superior).
🗣️ Consumer complaints (35%). Our top-rated life insurance companies have fewer than the expected number of complaints to state regulators over a three-year period, according to the National Association of Insurance Commissioners — so you can expect a smoother customer experience.
☎️ Consumer experience (20%). Insurers who allow consumers to contact them by email, phone and live chat earn the highest scores. The same goes for insurers who support online quotes, beneficiary changes and claims.
👀 Transparency (10%). Our methodology gives higher scores to transparent insurers who clearly display information about their policy options, coverage amounts and term lengths (if applicable) on their site.
⭐ What our star ratings mean
Companies with 5 stars are exceptional, with strong financials, diverse policy lineups and great reputations for customer service.
Companies with 4.5 stars are excellent, with solid financials and policy offerings, and good customer service track records.
Companies with 4.0 stars are good, and potentially great for people looking for niche coverage options.
Companies with 3.5 stars or fewer could do better in certain categories, like financial strength and customer complaints.
NerdWallet does not receive compensation for our star ratings or our reviews. Read more about our life insurance ratings methodology and editorial guidelines.
Frequently asked questions
In general, you need life insurance if your death would place a financial burden on others. This is especially true if you’re considered the breadwinner or primary income of the household, a parent, a homeowner, a business owner or anyone with co-signed debt.
Life insurance quotes provide an estimate of how much a policy might cost based on your answers to basic questions about your health, age, gender and lifestyle. Your actual cost may be different once you complete an application, but life insurance quotes can help you compare companies and get an idea of what fits your budget.
Yes. Many life insurance companies offer free term quotes online. However, when shopping for permanent coverage, such as whole life or universal life, you may need to speak with an insurance agent to get an accurate quote.
The amount of life insurance you need depends on how much money you want your beneficiaries to receive when you die. Ten times your annual income is a common estimate, but rules like this may not reflect your specific situation. Take into account your current finances and future obligations — such as income, debts and daily expenses — when calculating your coverage needs.
Life insurance premiums are calculated using a variety of factors, such as age, health, driving history, policy length and coverage amount. Insurers use this information to estimate your life expectancy, and then set your premium based on the risk of insuring you.
Life insurance rates are typically based on your age and health. They can also differ significantly among policies. The average monthly cost of a $500,000, 20-year term policy for a healthy 40-year-old is $26, according to Policygenius, a life insurance brokerage.
To compare, the average monthly cost of a whole life policy with the same coverage amount is $265.
If you don't need much coverage, check whether your employer offers group life insurance. Employee life insurance can often cover basic end-of-life expenses and may match some or all of one to two years of your annual salary. Basic group coverage usually doesn’t require an exam and may even be offered for free.
NerdWallet writers are subject matter authorities who use primary, trustworthy sources to inform their work, including peer-reviewed studies, government websites, academic research and interviews with industry experts. All content is fact-checked for accuracy, timeliness and relevance. You can learn more about NerdWallet's high standards for journalism by reading our editorial guidelines.
- 1.CDC: National Center for Health Statistics. Life Expectancy. Accessed Aug 13, 2026.