Term life insurance is a popular life insurance option due to its affordability and simplicity when compared to other policy types. 30-year term life insurance policies offer long-term coverage, usually at a constant monthly price.
If you’re new to life insurance, you might not know how a 30-year term life insurance policy could benefit you. This article serves to elaborate on the benefits of 30-year term life insurance policies, how they work, and how much they cost.
By reading a few short sections, you should have a better understanding of 30-year term life insurance policies. You should also be able to identify a few of the top life insurance companies to choose from.
What is 30-year term life insurance?
Term life insurance is a common life insurance policy option that lasts a predetermined amount of time or term. A 30-year term life insurance policy simply offers a policyholder coverage for 30 years or until death, whichever comes first.
Most life insurance companies also offer 10- and 20-year term life insurance policies. In fewer instances, you’ll find policies that extend to 35 or 40 years’ worth of coverage.
Is a 30-year term life insurance policy good?
Good is relative to the prospective policyholder. In some cases, a 10-year term life insurance policy might be more valuable than a 30-year policy. It comes down to age, budget, and policy flexibility.
For younger adults, a 30-year term life insurance policy can be ideal because there is one set rate for the duration of that term. The cost is predictable which makes budgeting easy.
A 10-year term life insurance policy isn’t the best option for most healthy young adults. Why? After 10 years, the rates can be subject to steep increases, depending on what changes in health you’ve experienced in that span.
Life insurance rates become increasingly expensive as you age, but once you agree to a 30-year term life insurance policy, your rates won’t be subject to change for that entire period.
According to the Centers for Disease Control and Prevention (CDC), life expectancy is 77.0 years old. In theory, this means that adults up to 40 years old could benefit from a 30-year term life insurance policy.
Contrarily, adults that are closer to traditional retirement age (65) might benefit from a 10- or 20-year term life insurance policy, or another policy type altogether.
How much is a 30-year term life insurance policy?
Term life insurance rates can vary due to many factors such as age, gender, coverage amount, company, and overall health. Ideally, you’ll compare rates from different life insurance companies to find the best rate given your situation.
Not all life insurance companies offer 30-year term life insurance policies. Although most companies do offer term life insurance, they might exclusively offer 10- and 20-year policies.
Below, you can see sample term life rates for a 35-year-old with a 30-year term life insurance policy from different companies.
|Company||$100,000 - Male||$100,000 - Female||$250,000 - Male||$250,000 - Female||$500,000 - Male||$500,000|
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Above, you can see how rates fluctuate from one life insurance company to the next. As a whole, AIG, Cincinnati, and Prudential appear to have the most affordable 30-year term life insurance rates for healthy adults.
For those with major health conditions or that smoke, this may not be the case. Again, life insurance companies provide rates with unique pricing schemes, and health is one of the major variables when pricing.
Otherwise, age can be a major variable in the life insurance pricing process. Below, you’ll see how rates increase with age.
|Age||Male - AIG||Female - AIG||Male - Cincinnati||Female - Cincinnati||Male - Prudential||Female - Prudential|
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Above, you can see how much the prices change for a life insurance policy as you age. For example, the monthly cost of a 30-year term life insurance policy for a 45-year-old is typically more than double that of a 35-year-old.
This shows the value of investing in a 30-year term life insurance policy sooner rather than later. It appears that AIG, Cincinnati, and Prudential are affordable and competitive regardless of age.
More About 30-Year Term Life Insurance
Buying a life insurance policy is all about creating financial stability. Investing in a life insurance policy can protect your family, but you might want to consider protecting yourself along the way.
Chances are, if you’re approved for a 30-year term life insurance policy then you are a younger adult that is in good health. Needless to say, there’s a chance that you could outlive your life insurance policy.
While you may not incur a major monthly expense, you don’t want all of your life insurance premiums to just disappear if you outlive your policy. Investing in a return of premium rider could be worthwhile.
A return of premium rider offers a full or partial refund of your term life insurance premiums if you outlive the policy. While $20 per month might not seem like much, it adds up to about $7,200 over the course of 30 years.
There could be other valuable life insurance riders for you, depending on your personal situation. Some will increase your life insurance rates, so be sure to get quotes with and without them when comparing.
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Lastly, be sure to investigate your life insurance company’s ratings. There are a handful of reputable sources to use such as A.M. Best, Fitch, Moody’s, and the National Association of Insurance Commissioners (NAIC).
Other organizations like J.D. Power have rated life insurance companies on customer satisfaction. State Farm, for example, has the highest ratings for customer satisfaction, but they tend to have more expensive life insurance rates, as shown in the first comparison table.
While AIG and Prudential had some of the most affordable rates, both companies scored below the industry average for customer satisfaction. Unfortunately, Cincinnati wasn’t included in the study to compare.
No life insurance company will have perfect ratings across the board. That said, it’s still important to do a little research to avoid investing in a company that isn’t financially stable or that won’t distribute your death benefit when the time comes.
30-Year Term Life Insurance: The Bottom Line
Investing in a life insurance policy is an important decision with long-term consequences, good or bad. A 30-year term life insurance policy can be a great option for younger adults that are in good health.
If you’re looking for a 30-year term life insurance policy, it might be best to start by comparing rates from AIG, Cincinnati, and Prudential. Be sure to get quotes with and without a return of premium rider.