Factors Affecting Voluntary Life Insurance Costs: Age, Gender, Health, and Coverage Type

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Voluntary life insurance costs depend on several factors. Including age, gender, health, the type of coverage and the policy’s face value. Term life and whole life are the two most popular types of life insurance. With term life being the most affordable. Typical term life insurance rates range from about $30 to $60 per month for a middle-aged person.

Life Insurance Providers

When shopping for life insurance, don’t assume every national insurance carrier is showing you all the possible options. Some insurance providers and agents don’t offer every type of insurance, particularly variable products. By understanding your options, you can find the insurance provider that best suits your needs more easily.

Some top life insurance providers to consider include Policygenius, Northwestern Mutual, Allstate, MetLife Financial, and Prudential Financial.


Policygenius is the right choice for consumers seeking a combination of whole and term life insurance. To get the most coverage or at the most affordable pricing. It offers convertible term policies quickly online. But also has access to shop rates for whole life insurance among its host of insurance partners.

An online personal insurance broker that partners with top voluntary life insurance providers. They get customers the best policy for the best rate. The mission is to take the insurance-speak out of the purchasing process. This is to help policyholders feel confident their beneficiaries will get proceeds quickly.

Northwestern Mutual

Northwestern Mutual is ideal for young customers seeking permanent insurance like universal life. They prioritize life products and offer more options, unlike other national providers who also cover property and casualty.

As a mutual insurance company, Northwestern Mutual shares its profits with policyholders, offering a range of personal insurance and investments such as life insurance, disability insurance, long-term care insurance, annuities, and mutual funds.


Allstate is the ideal option for individuals who wish to maximize cash value growth in permanent life insurance by utilizing mutual fund subaccounts. Its variable universal life policy offers permanent insurance for younger insureds, adapting to their evolving family needs and long-term investment goals.

This national insurance company provides a personal touch to insurance transactions. They offer home, auto, life, and commercial insurance through local agents. Consumers can save on premiums by bundling home, auto, and life insurance through their Allstate agent.


MetLife is ideal for those in need of a term policy. They offer the option to convert it to permanent insurance, providing lifelong coverage for budget-conscious consumers.

It is a global provider of life insurance, annuities, and employee benefits. With 90 million+ customers in 40+ countries, it specializes in life and health insurance solutions for small business owners and benefits programs.

Prudential Financial

Prudential Financial is ideal for families needing estate planning. They offer solutions for estate taxes, special needs trusts, and legacy building. With global offices, Prudential is a trusted company with 140 years of financial strength.

Voluntary Life Insurance Costs

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Life insurance costs depend on age, sex, health, and lifestyle. Certain policies with more features like type, term, and size are costlier. For instance, you could pay $20 monthly for a small policy in your 20s, but it could increase to thousands per month after 50 or 60.

Insurance companies have different pricing and preferences for life insurance. Some prioritize permanent insurance, while others focus on term policies. When buying variable life insurance, check if the subaccounts align with your investment goals and consider how fluctuations might impact your benefits.

Factors That Impact Voluntary Life Insurance Rates

When you purchase life insurance, you pay premiums to your insurer in exchange for a death benefit. That your beneficiaries receive when you die. Because life insurance pays a benefit at the time of your death. Premiums are based on the risk of you dying prematurely; or before the end of a designated term.

There are two types of risk factors that affect term life insurance rates:

Personal risk factors: Age, gender, or any factor that holds the potential for you to die early. You can have several risk factors or none at all. The insurance company rates every risk based on a value per $1,000 of coverage.

Policy factors: These are factors unique to the policy you purchase. For example, how much the policy pays; how long the term is; and what other benefits come with it all impact the cost of life insurance.

Personal Risk Factors Affecting Voluntary Life Insurance Costs

Personal risk factors like age, gender, smoking habits, occupation, and hobbies affect life insurance costs. Not disclosing relevant information on an application is insurance fraud, leading to denied claims or policy cancellation.

Age and Life Insurance Costs

Age is a crucial factor in mortality rates. Younger individuals tend to live longer, allowing life insurance companies to collect monthly premiums for a longer duration. Applying for life insurance at an older age increases the cost of the premium.

The premium gap between males and females grows with age. For instance, a heterosexual couple in their 20s would have similar rates, but a couple in their 50s would see the woman paying much less than the man.

Gender and Life Insurance Costs

Gender plays a significant role in life insurance premium costs. Generally speaking, rates for women are less expensive than they are for men since women tend to live longer. The average life expectancy at birth for a woman is 81.3 while, for men, it’s 76.3. These numbers do change as health trends change.

Two people with similar health history may have different insurance prices due to population health trends, as seen in the example of two brothers applying for life insurance a year apart despite having the same family history, health rating, and lifestyle.

Smoking and Life Insurance Costs

Smoking raises life insurance premiums significantly. A male smoker in his 30s pays 2-3 times more than a nonsmoker. It takes at least 2 years of quitting for an insurer to view you as a nonsmoker.

The term for tobacco use on life insurance applications is “smoking.” It includes chewing tobacco and vaping, along with smoking. Even if your grandpa lived to 100 while smoking cigars daily, it won’t lower your premium rates.

Health Conditions and Life Insurance Costs

Poor health results in a lower life expectancy in most people. Ongoing health concerns such as hypertension, high cholesterol, obesity, and diabetes adversely affect life expectancy. The presence (and combinations) of these health conditions are personal risk factors that typically increase the cost of life insurance.

Every insurance carrier rates conditions differently and has its own factoring system for multiple conditions. Expect an insurance carrier to request medical records from primary care physicians and specialists to determine the level of concern for chronic and ongoing health issues.

Personal Health History and Life Insurance Costs

Your health history has a big effect on your life insurance eligibility. Past conditions like cancer, heart disease, stroke, and depression matter, but the amount of time since these events also influences the insurance company’s evaluation and your premiums.

For instance, ovarian cancer, with an 85% recurrence rate, makes it difficult for people to qualify for life insurance. Most consumers face the challenge of becoming ineligible due to their health history, leaving them unable to obtain or afford coverage when they actually need it.

Family Health History and Life Insurance Costs

Insurance companies also consider your family―blood relatives, typically limited to parents and siblings―health history. Insurance companies are generally most concerned with health conditions that resulted in the death of a family member before the age of 60.

The rationale is simple. If every man in your immediate family had prostate cancer, there is likely a genetic predisposition for a male descendant to be diagnosed with it. If you don’t know your family’s health history, state that. Just remember that lying on an insurance application is a fraud and subject to penalties and fines.

Occupation and Life Insurance Costs

Occupation can play a role in determining your premium, but usually only if you’re working in a field particularly hazardous or extremely stressful. Some of the most hazardous jobs that could affect your premium include aircraft pilot, roofer, truck driver, and construction worker.

Those serving in the military, police, and fire department often have special underwriting standards. If you are an everyday hero, talk to your union or personnel office about the best insurance companies to work with you.

Travel and Life Insurance Costs

Life insurance application asks if you’ve visited foreign countries within 6 months. Traveling to developing countries raises disease risks, which may affect insurance pricing if you plan to travel soon. Wait 6 months after trip for better rates.

For those who travel often, the life insurance company may require additional medical records and vaccination documents to rate the policy. Talk to your insurance agent if you travel frequently.

Lifestyle and Life Insurance Costs

If you like living life on the edge, your life insurance company will do one of three things: rate the policy, exclude the activity, or deem you ineligible. For example, riding motorcycles or mountain climbing usually increases your premium, as does a bad driving history, especially a DUI within the past 5 years, or a criminal record.

A criminal history can increase your premium by around $2.50 per $1,000 of coverage, which means an additional $250 per year on a policy with $100,000 in coverage. Life insurance companies don’t accept applications from anyone in jail, awaiting trial, or is currently on probation.”

What a Voluntary Life Insurance Table Rating Is

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Table rating is a points system used by insurance providers to assess the impact of your health condition on insurance costs. It considers factors like your health and assigns a rating.

Insurance companies group conditions based on their impact on health. Applicants are given a rating based on their overall health and conditions, from simple factors like height and weight to major illnesses like cancer or chronic conditions such as diabetes.

The chart below gives an idea of how table rating affects your life insurance rates by increasing your costs with every health issue. The higher the table rating class, the more expensive life insurance gets.

Table Ratings Affect Voluntary Life Insurance Costs

Every life insurance carrier uses the table ratings to adjust costs based on one or more health conditions. While the table is widely accepted, every carrier makes adjustments based on their own underwriting parameters.

Policy Factors Affecting Voluntary Life Insurance Costs

In addition to the personal risk factors that impact the cost of life insurance, policy characteristics, such as the size, term, and type of life insurance policy you purchase, play a large role in the cost of your premium.

Death Benefit Amount and Voluntary Life Insurance Costs

As you might expect, the larger the death benefit on your policy, the higher your premium will be. However, the rate of increase declines with higher face values. In other words, double coverage doesn’t mean your rate doubles. It’s not a dollar-for-dollar correlation.

The premium for a $250,000 policy for a healthy 30-year-old woman is about $19/month. But for a $1 million policy, it’s around $37/month. Despite the higher death benefit, the premium cost only increases by about two times.

Term Length and Life Insurance Costs

The cost of term life insurance relies on the length of the policy. Longer terms mean higher premiums, as they cover ages with higher mortality rates.

For example, the cost for a $500,000 term policy for a healthy 40-year-old male could be $38 per month for a 10-year term policy, but it will be approximately $116 per year for the same amount of coverage under a 30-year term policy.

Administrative Fees and the Cost of Insurance

Life insurance includes a cost called COI for underwriting and administration. Permanent life insurance has an investment component called cash value, which is invested by the insurer in mutual fund variable accounts that have additional fees.

The life insurance costs paid by the COI bucket include:

  • Mortality and expense charges: Costs required to pay life insurance death benefits
  • Sales and administrative fees: Commissions, policy maintenance, and standard business expenses
  • Riders: Additional coverage options that customize a policy including things like guaranteed insurability, waiver of premium, and accelerated death benefits
  • Investment management fees: Costs associated with managing the investment portion variable life insurance

How Coverage Type Impacts Voluntary Life Insurance Costs

There are two types of life insurance: temporary and permanent. Term insurance covers a set number of years, while permanent insurance lasts as long as premiums are paid. Permanent insurance is more expensive than term policies.

Term and permanent insurance are further broken down into the following policies structures:

  • Term life insurance: Level term, decreasing term, return of premium, and annual renewable
  • Permanent life insurance: Whole life insurance, variable life insurance, and universal life insurance

Term Life Insurance Costs

Such costs are directly tied to the term’s length and your insurer’s expenses for maintaining your policy, or COI, based on table ratings. However, not every term insurance policy is structured the same way. Each structure is designed to serve a very specific life insurance purpose.

The four types of term life insurance structures are:

Level term: Commonly structured for anywhere from 5 to 30 years with the premium and the death benefit remaining constant throughout the life of the policy. These would often be considered the baseline pricing policy type.

Decreasing term: Designed for mortgages or business loans, this policy’s death benefit decreases annually as the debt is paid off. Typically lasting 15 or 30 years, it is more cost-effective than level term.

Return of premium (ROP): Follows normal term insurance policies of 10 to 30 years with the premium paid during the course of the policy returned to the policy owner at the end of the term if no death benefit was paid, making it a more expensive policy.

Annual renewable: Single-year term policies with guaranteed renewability where premiums increase based on the insured’s age at the time of renewal but do not require another medical exam.

Permanent Life Insurance Costs

Because permanent life insurance pays a death benefit and a savings component called the cash value account, it’s often more expensive than term. The different permanent life insurance structures are designed to help satisfy investment objectives and suitability as well as make permanent life insurance more affordable to younger individuals.

The three types of permanent life insurance are:

Whole life insurance: Maintains a level death benefit, guaranteed minimum interest rate on the cash value, and level premiums throughout the policy period.

Variable life insurance: Places cash value funds into a mix of mutual fund subaccounts to meet the long-term investment objectives of policyholders in hopes of using cash value to pay premiums or increase death benefits.

Universal life insurance: Makes permanent life insurance affordable for younger insured’s by allowing for annual renewals with rates increasing every year ideally with the cash value absorbing the difference in premium costs.

Private Life Insurance vs Employer Benefits

Private life insurance and employer-provided group benefits differ greatly. Employer policies are affordable but non-transferable, only covering death from accidents. This means beneficiaries receive no benefits if one leaves the company or dies from an illness.

It is wise to max out your employer’s group term life insurance benefits because it is so affordable, but you may want to get additional life insurance that meets your family’s long-term needs.

Voluntary Life Insurance Costs for Small Business Owners

Small business owners pay the same for life insurance as non-business owners as premiums depend on life expectancy. But they may also need personal life insurance and key man insurance, which is owned by the business to cover the insured’s death and ensure business continuity.

Buy/sell agreements for small business co-owners often include key man insurance requirements. This insurance is crucial for business continuity in case of unexpected death and is mandatory for certain SBA loans.

“The SBA provides guaranteed business loans. They work with approved financial institutions like banks to lend money to businesses and the SBA guarantees these loans. With an SBA loan, you typically must obtain life insurance coverage, often term life with a coverage amount reflecting the size of the loan. This protects the bank if death occurs during the term of the loan through the use of a collateral assignment, a legal document that says the bank will get paid the remainder of the loan first. The term of the insurance should match the term of the loan.”

Mike Raines, Agent, Raines Insurance Group

However, beyond specific business life insurance policies…

It’s also important to maintain adequate life insurance for the benefit of your family, for all of the same reasons anyone may want a policy. Every business owner should consider what his family needs personally and what the business requires to continue without him.

“It’s important to understand that key person insurance is not a substitute for personal life insurance. While key person insurance can help cover the costs of locating and securing external governance, replacing lost revenues, or executing the terms of a buy-sell agreement, it will not be covering your family’s needs. For that, a small business owner will still need personal life insurance.”

Jennifer Fitzgerald, CEO, Policygenius

Voluntary Life Insurance Costs Tips

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Keeping life insurance costs down allows you to do various things, such as either buy more life insurance to cover your changing needs or invest the difference in other areas of your financial life. This is why understanding your biggest insurance priorities is imperative.

Here are three tips to consider when shopping for life insurance costs.

1. Check Affordability of Term and Permanent

Emily Johnson, Head of Product, Fabric Technologies

“Most people are shocked by what they can afford when it comes to life insurance. Sometimes, the shock is the result of great health ratings generating cheap rates. However, other times, it is because the person looking to buy is older or less healthy and faces unaffordable coverage. Find out where you stand so you can choose a policy that covers your priorities.

“You can now buy competitive term insurance policies without going through an agent through several companies with an online presence. Just check to make sure that the company you use is backed by an insurer with a solid rating from A.M. Best.”

2. Use Employer Benefits as a Start

Byron Ellis, Certified Financial Planner, United Capital Financial Life Management

“Employer group life often allows you to purchase 3 to 5 years of your salary in life insurance for pennies on the dollar. This is a great way to get some basic life insurance in place inexpensively while with the employer. Understand that most group plans only cover accidents and not illnesses, so you do want to look at private policies for long-term protection.

“Most group plans are priced in age bands. Typically, every 5 years or so, the cost goes up. This makes it look appealing when you first sign up, but the policy could end up costing you more over 10 or more years. For example, if you are 30 years old, you will most likely keep your coverage for 20 years or longer. You may find that a 20-year policy [purchased on your own] will end up being cheaper than your group coverage.”

3. Get a Free Medical Exam

Margaret M. Koosa, CEO, The Alchemists, Your Wealth Concierge

“In many cases, a quote is nothing more than an estimate based on your application that is finalized with a medical exam. Getting the medical exam before you shop rates in a ton of places is smart because you will get a copy of the results, and this can make it easier to compare rates among other carriers.

“Most underwriters require a medical exam of some sort, which may include height, weight, blood and urine samples, and other tests, depending on the age of the proposed insured. They will also review one’s personal medical history and request records from any physicians they have consulted. In addition, the health, longevity of one’s parents and siblings and, if applicable, cause of death may be considered.”

Voluntary Life Insurance Costs Frequently Asked Questions (FAQs)

Below are some of the most frequently asked questions about life insurance costs.

How do I find the best rates for life insurance?

Decide on the needed insurance coverage, explore term and permanent policies or a mix of both. Assess costs, find the insurance type that suits you, and compare rates from different providers. Certain carriers offer more affordable term coverage than permanent.

Do group life insurance policies have lower rates than other policies?

Group life insurance policies purchased through employee benefits are typically cheaper than private plans. These policies offer employees the option to choose a multiple of their salary for accidental death coverage. However, they do not provide coverage for death resulting from illness.

Is a medical exam required to get life insurance?

Not all life insurance policies necessitate a medical exam. Group plans, children’s whole life insurance, and certain final expense plans do not require physical exams. Moreover, individuals in good health and under the age of 35 can obtain term policies with death benefits under $250,000 without undergoing medical exams.

Bottom Line

In all life insurance types and companies, healthier and younger people pay less. Women are also cheaper to insure than men. Knowing how your medical history and job influence cost is crucial when looking for affordable life insurance.

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