Life
7 min read

Cost of Million Dollar Insurance Policy

Written by
Team Waffle - Ryan
Published on
July 19, 2022

It's possible that purchasing a life insurance policy with a face value of one million dollars will seem excessive at first, but if you want to ensure that your loved ones will be provided for after your passing, you may find that this sum is actually more reasonable than you originally thought.

The amount of life insurance you need is partially determined by the number of people in your family as well as your current financial standing. For illustration purposes, let's say that you have an annual income of $100,000 and you wish to replace that income for a period of ten years. That alone will obtain you a death benefit of $1 million.

Or, if you are simply interested in replacing your income for the next five years, but you also want to save money for your children's college expenses and pay off some debt, you can easily reach the one million dollar level. The average cost of attending a private school for four years, including tuition, accommodation and board, and textbooks is approximately $200,000 (and, according to some projections, might go as high as $450,000 in another 15 years).

You shouldn't automatically think that you can't afford a life insurance policy of one million dollars. People have a tendency to grossly underestimate the cost of life insurance, often by a factor that is three times greater than the real cost. First, determine how much you can spend on life insurance by looking at the typical prices, and then acquire quotations for your own customized policies.

How Much Does a $1 Million Term Life Insurance Policy Cost?

The length of your policy would have an impact on how much you pay annually for the premiums on a $1 million term life insurance policy. A life insurance policy that covers the insured for 10 years costs $32.05, while a policy that covers the insured for twenty years has an average monthly premium of $46.65.

Keep in mind that these are averages, and that your cost will depend on your age, health, and other risk factors, as well as the averages. But our look at average rates will give you a good idea of how much you can expect to pay.

$1 Million Life Insurance with No Medical Exam

Instant life insurance coverage doesn't require medical exams. Your application might be approved within minutes if, among other criteria, you are of a suitable age and have generally good health.

There is a common misconception that instant life insurance is the same as guaranteed-issue policies, which are typically available for senior citizens but can be more expensive. A health questionnaire is something else that differentiates simplified problem plans from other types of policies: they demand you to fill it out.

If you are interested in purchasing a life insurance policy with a face value of one million dollars, one of the simplest methods to do it is by submitting an application for an immediate life insurance policy life Waffle.

Younger Age Means Paying Less For a $1 Million Policy

Your age is the key factor used to determine your life insurance premium, and as you become older, your premiums will increase year after year. This is due to the fact that when your life expectancy decreases, the risk that is posed to the insurance company also grows. This indicates that you ought to purchase coverage when you're younger so that you may lock in lower prices.

You can make significant cost reductions if you purchase coverage when you are in your 30s. If you are in your 50s or 60s and you get a 20-year term insurance, your premiums will be much higher than if you purchased coverage when you were younger:

If you wait until you are 40 years old to buy a $1 million, 20-year term life insurance policy, your premiums will increase by as much as 65 percent for males and as much as 50 percent for females.

If you wait until you are 50 years old, the premiums will be 260 percent higher than the cost for a 30-year-old, and this applies to both males and girls.

Again, as compared to the cost of purchasing the plan when you were 30 years old, the cost of waiting until you are 60 years old results in an increase of more than 950 percent for males and more than 600 percent for females. At the age of 60, the annual premium for men is more than $5,000. If the policy had been obtained when the insured was only 30 years old, the rates would have been guaranteed at only $480 per year.

How Gender Affects the Cost of $1 Million Term Life Insurance

As you could guess, gender also affects life insurance rates. Females live longer than males, thus they're cheaper.

Males pay more regardless of age, according to our analysis. Age affects the rate difference.

Taking a policy with a period of twenty years as an illustration, the following is how gender influences rates:

  • At the age of 30, men pay around 38 percent more than women, which is equivalent to an additional $130 per year.
  • Males pay 25 percent more, which is equivalent to an additional $144 per year, beginning at the age of 40 than females do.
  • At age 50, males pay around $480 more per year than females, which is a difference of 38%.
  • Males pay 44 percent more than females do at the age of 60, which comes out to an additional $1,536 year.

How to Shop For a $1 Million Term Life Insurance Policy

Before you look for term life insurance, you need to figure out how much coverage you need.

You want the amount of your life insurance payout to cover your debts, such as your mortgage, car loan, credit card balances, and any other debts you have. Also, think about how much extra money you want to leave for things like paying for college or replacing your income.

Next, figure out how long you need the policy to cover you. How long will your family and friends need the money from the policy? For example, if you want to pay for your kids' college in 12 years, you would need a policy that lasts at least 15 years.

Focus on the length of the term, but also look at longer terms to compare prices. It won't hurt to increase the length of your policy if you can afford to. This way, if your debts grow or don't get paid off as quickly as you thought, you'll still have a life policy for a few more years.

For example, if you don't own a house now but plan to buy one with a 30-year mortgage in the next few years, it makes sense to look at loans with terms of 15 to 30 years.

Once you know how much you want to spend and how long you want the policy to last, you are ready to get a price from Waffle insurance.

There is no medical exam needed when getting quotes for a $1 million term life insurance policy so it is fast and simple. Note, though, that you might not be able to get one of these instant policies if your health isn't very good or excellent. Also, not all no-exam insurance companies offer policies worth $1 million.

When getting a quote for life insurance, it's helpful to have the following information on hand as it will make the process much faster:

  • Height and weight
  • The medical history of parents and siblings and their immediate family
  • Personal medical information, including knowledge of past and present health, current and past medications, and information about lifestyle choices, such as smoking and drinking
  • Dangerous hobbies, like flying planes and diving under water
  • Plans for trips outside the US in the future
  • Make sure to tell the truth. If you lie on your application, the policy will be null and void in the future.

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