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A quarter of a million dollars may sound like a lot, but a $250,000 life insurance policy might not be nearly enough life insurance for you. On one hand, it’s cheaper than a $500,000 or $1 million policy, but will it be enough to cover all your family’s needs if you pass away unexpectedly? These are things to consider as you shop for life insurance.
Our analysis of life insurance quotes can help you see how much you may be able to afford.
How Much Does a $250,000 Life Insurance Policy Cost?
We analyzed term life insurance quotes for $250,000 life insurance policies to determine the average cost. The average price for a 10-year, $250,000 term life policy is about $130 a year for a 30-year-old. The average cost is $180 a year for a 20-year term. These rates are for healthy nonsmokers.
Related:
Annual costs for 15-year, $250,000 term life insurance policy
Annual costs for 20-year, $250,000 term life insurance policy
Annual costs for 30-year, $250,000 term life insurance policy
It can be extremely difficult to find 30-year term life insurance at age 60 or over.
Buying Younger Means Lower Costs for a $250,000 Life Insurance Policy
When you buy life insurance, your age is a significant pricing factor. Quotes will rise every year that you delay buying life insurance. It’s cheaper to buy life insurance when you’re younger and can lock in low rates.
Our analysis discovered solid savings if you buy life insurance in your 30s.
- Waiting from age 30 to 40 to buy a 20-year term $250,000 life insurance policy has quotes increasing by 31% for males and 36% for females.
- Putting off purchasing a policy from age 30 until age 50 sees quotes increase 163% for males and 129% for females.
- If you wait from age 30 to 60 to obtain a policy, quotes rise a whopping 613% for males and 471% for females.
- For 60-year-old males, average quotes are nearly $1,400 annually compared to a $192 annual rate locked in if the policy was purchased at age 30.
How Gender Affects the Cost of $250,000 Life Insurance
Females normally live longer than their male counterparts, so they usually pay a little less for life insurance.
For example, looking at 20-year term life insurance, here’s how gender affects quotes:
- At age 30, males pay 14% more, or $24 more per year than females.
- At age 40, males pay 11% more, or $24 a year more than females.
- At age 50, males pay 31% more than females, which is $120 a year more.
- At age 60, males pay 43% more than females, which comes to $408 a year.
$250,000 Life Insurance Costs by Term Length
If you’re buying term life insurance, you’ll usually want to match your term length to your longest financial obligation. For example, do you need life insurance for income replacement, kids’ college tuition, or covering debts like loans or a mortgage?
Here we compare $250,000 life insurance costs for various lengths of policies.
Our analysis of average $250,000 life insurance costs found:
- Upgrading from a 10-year to a 15-year term raises quotes 18% for males and 9% for females.
- Moving up from 10-year to 20-year term life insurance pushes up quotes by about 45% for males and 27% for females. This doubles your term length, but you pay less than 50% more.
- Going to a 10-year term to a 30-year term increases quotes by 109% for males and 82% for females. You triple the policy length but only pay around double the amount, so it’s not a bad deal if it still fits your budget.
Life Insurance Costs by Policy Amount
We analyzed rates for $250,000 life insurance compared to $100,000 up to $1 million.
Our analysis found that:
- A $500,000 life insurance costs 56% more for males and 50% more for females than $250,000 life insurance. Thus, for around 50% more, your beneficiaries would get double the payout.
- Increasing coverage from $250,000 to $750,000 will cost 106% more for males and 71% more for females. This doubles the cost for males, and not quite as much for females, but triples your coverage amount.
- Upgrading from $250,000 life insurance to a $1 million life insurance policy costs 150% more for males and 107% for females.
Life insurance cost comparison by coverage amount
Tips for Buying a $250,000 Life Insurance Policy
Determine whether $250,000 in life insurance is enough
Shopping for a life insurance policy first starts with determining how much life insurance you need.
Calculate how much you want to include for funeral expenses, income replacement and education for your children. Include large debts in your coverage amount, such as a mortgage.
You may find that a $250,000 life insurance policy is far less than your family would need. For example, if you make $80,000 a year and want to provide income replacement for 20 years, that’s already $1.6 million.
Determine coverage length needed
Next, consider how long the life insurance policy needs to last. If you’re younger and have a 30-year mortgage to pay off, a longer term is likely better. If you’re older and have paid down debt and your mortgage has only a few years left, a shorter term may work just fine.
If your life insurance needs extend beyond a specific time period, consider permanent life insurance such as universal life insurance or whole life insurance.
Compare life insurance quotes
Check life insurance quotes from multiple companies. Life insurance quotes are always free. These are typical factors in costs:
- Past and current health
- Height and weight
- Lifestyle information, such as smoking
- Family medical history for immediate family (parents and siblings)
- Medications, current and previous
- Dangerous hobbies, such as scuba diving or flying planes
- Future travel plans outside the United States
- Coverage amount and policy type
You may be required to take a life insurance medical exam. This gives insurance companies more details for determining your life expectancy. No-exam life insurance is also available for coverage amounts such as $250,000.
Be truthful because misrepresenting information on a life insurance application could cause the policy to be voided in the future.
Methodology
Term life insurance quotes are for healthy non-smokers of average height and weight. We averaged the four cheapest quotes we found online. Your rates will be different depending on your age, health, family health history, driving record and other factors.
