life insurance

How Much Does Life Insurance Cost?

September 15, 2023

When a life-altering event happens, it can leave loved ones with not only grief but also an unstable financial situation. Having life insurance is an important safety net for you and your family, providing financial security and protecting their future.

Along with covering funeral costs, medical bills, debts, and mortgage payments, many policies also accumulate cash value. If unexpected expenses or opportunities occur, you can access funds for temporary financial needs. Although every policy comes with premiums, the long-term security benefits outweigh the upfront costs.

Factors Affecting Life Insurance Costs

The cost of insurance varies from person to person based on several factors. These include:

  • Age: In general, younger people pay less since they have a longer life expectancy.
  • Health: If you have a health condition or disability that could statistically shorten a lifespan, premiums are often higher. Additionally, a family history of certain diseases may also factor into the cost.
  • Lifestyle: Insurers may factor in risky hobbies, such as race car driving or skydiving. They will also consider lifestyle factors such as smoking and excessive drinking, which serve as red flags to insurance companies.
  • Policy type: Insurance has evolved into a flexible industry designed to cater to individual needs. The type of policy chosen will come with different costs. Typically, a term life insurance policy is the most cost-effective option but may not provide all the benefits needed.
  • Coverage amount: Increased coverage comes with a higher premium.

Calculating Life Insurance Needs

A key step in ensuring you get the right coverage is calculating insurance needs. One proven way to do so is by using the debt, income, mortgage, and education (DIME) method to add expenses and determine a base-level insurance number.

Key factors to consider when using DIME are whether your family will require replacement income, provide funds to pay off a mortgage or make payments, and cover debts such as credit cards and private loans. Along with your current situation, you also should factor in the costs for any ongoing child expenses and end-of-life costs.

Although DIME seems complex, you can make the process quick and easy by using 1891’s online insurance calculator. It provides a more precise calculation of your needs and allows you to enter information for different scenarios, helping you make a more well-informed decision.

How to Save on Life Insurance

After determining the right coverage amount, some people may be surprised at the premium price. Luckily, insurance companies offer flexibility and different options to help you meet your financial needs now and in the future. Some ways to save on life insurance include:

  • Only buy the amount of coverage you need now.
  • Focus on living a healthy lifestyle.
  • Look into policy riders and other options.
  • Add life insurance to your budget.
  • Work with experienced professionals, such as 1891 Financial Life advisors.

Life insurance is a must in today’s world, especially for people with families. Although different factors play into how much it costs, there are ways to save on premiums. Obtain quotes and get a policy lined up now to ensure your family’s future financial stability.


About 1891 Financial Life

At 1891 Financial Life we don’t just sell policies, we offer possibilities. We pride ourselves on giving back to the communities that we serve by providing quality and comprehensive insurance solutions. We are a not-for-profit life insurance Society, which means the sales from these financial service products help fund member benefits along with social, educational, and volunteer programs designed to respond to community needs.

Our portfolio is extensive, ranging from various life insurance policies to our annuities to support your financial needs no matter what stage of life you’re in.