Many people wonder about the cost of a million-dollar life insurance policy. When considering such a large coverage amount, the first thing to look into is how much it will cost. For example, the average cost of a 10-year, one million-dollar life insurance policy is around $15 per month for a healthy 30-year-old woman. However, the price varies depending on your age and other factors.
If you’re thinking about purchasing this type of policy, it’s essential to understand how it works, its limitations, benefits, and costs. While the cost of life insurance policies can differ, several factors known as risk factors affect the price. These factors are used by life insurance companies to determine premiums. This guide will explore the cost of a million-dollar life insurance policy, along with the different factors that influence its price.
How Much Does a Million-Dollar Life Insurance Policy Cost?
As previously stated, how much a million-dollar life insurance policy costs depends on different factors such as your health, age, and gender. These factors determine how much a policyholder would pay on a million-dollar life insurance policy.
In cases where these considered factors produce a good result, you may get a lower cost for a million-dollar life insurance policy, while it is the opposite if the result is bad or poor. However, the following are the average costs for a million-dollar life insurance policy by age and gender.
Generally, age and gender are key factors that affect your life insurance policy cost. Men usually pay more for life insurance coverage than women, while people in their 50s and 60s tend to pay more for coverage than people in their 30s. Using the table below, you can determine how much a million-dollar life insurance policy costs depending on your insurance term length:
Average Cost for a Million-Dollar Life Insurance Policy for a 10-Year Term
| Age | Monthly Cost for Men | Monthly Cost for Women |
| 30 | $27.90 | $23.11 |
| 40 | $40.76 | $33.37 |
| 50 | $194.22 | $129.40 |
| 60 | $585.87 | $418.66 |
Average Cost for a Million-Dollar Life Insurance Policy for a 20-Year Term
| Age | Monthly Cost for Men | Monthly Cost For Women |
| 30 | $43.27 | $33.65 |
| 40 | $64.59 | $54.05 |
| 50 | $388.74 | $248.31 |
| 60 | $1,403.67 | $1,118.76 |
Average Cost for a Million-Dollar Life Insurance Policy for a 30-Year Term
| Age | Monthly Cost for Men | Monthly Cost got Women |
| 30 | $73.24 | $64.06 |
| 40 | $135.40 | $108.65 |
| 50 | $520.12 | $380.67 |
| 60 | NA | NA |
Factors That Affect How Much a Million-Dollar Life Insurance Policy Costs
The cost of a million-dollar life insurance policy is influenced by several factors. In addition to the policyholder’s age and gender, other elements also play a role in determining the price.
These include the type of policy, occupation, medical history, and lifestyle. Below, we explain how each of these factors affects the cost of your insurance policy:
Age & Health
Younger policyholders with sound health tend to pay lower premiums on a million-dollar life insurance policy than older ones. People with preexisting conditions like obesity, heart conditions, diabetes, and high blood pressure tend to pay more premiums.
If you want to purchase life insurance at a lower cost, taking medical exams regularly may be a good option to consider. Doing this helps insurance companies keep a record that you are in sound health, causing you to get lower premiums. However, older people pay more premiums because they are considered to need more medical care than younger people.
Gender
Gender is an important factor that many life insurance companies consider when determining premiums. In some states, gender-based pricing is required by law. In these states, women generally pay lower premiums than men, as men are often seen as higher-risk policyholders.
Although women typically pay less, their premiums can increase if they have a medical condition or engage in risky behaviors such as drug use or excessive alcohol consumption.
Policy Type
There are two main types of life insurance policies: whole life insurance and term life insurance. Term life insurance provides coverage for a specific period, typically ranging from 10 to 30 years.
This insurance policy comes with lower premiums but ends after the coverage term expires. Whole life insurance offers coverage to policyholders throughout their lives, and it comes with a cash value component that grows as the policy grows older.
Unlike term life insurance, this life insurance policy comes with more expensive premiums because it accumulates cash values. While it is expensive, it comes with long-term riders like disability and long-term care riders. As you select which of these two to purchase, it is important to consider your budget, living expenses, credit card debts, type of coverage you need, and financial goals.
Occupation and Lifestyle
Your lifestyle and occupation can affect how much you pay for a million-dollar life insurance policy. Job type, smoking, travel, high-risk hobbies, and drinking can affect your life insurance premiums.
Your job type is the most important factor considered to determine your premiums for a million-dollar life insurance policy. Most people who have high-risk jobs pay more premiums than those with safer jobs.
Policy Length and Coverage Cost
The cost of your selected coverage and how long it lasts also affect how much your life insurance policy costs. For term life insurance, insurance rates increase as the term length rises, and it tends to cost more as the term increases. When selecting coverage amounts, it is vital to consider your financial duties, such as college tuition, retirement costs, etc.
By selecting the best term and amount for your budget as well as fixing up other factors, you may be able to pay less on premiums.
