Compare Life Insurance Quotes: February 2023

In general, people need life insurance if their death would place a financial burden on others. Examples include breadwinners, parents, homeowners, business owners and people with co-signed debt.

Yes. Many life insurance companies offer free term quotes online. However, when shopping for permanent coverage, such as whole life or universal life, you may need to speak with an insurance agent to get a full quote.

The amount of life insurance you need depends on how much money you want your beneficiaries to receive when you die. Ten times your annual income is a common estimate, but rules like this are not universal and may not reflect your specific situation. Take into account your current finances and future obligations — such as income, debts and daily expenses — when calculating your coverage needs.

Life insurance premiums are calculated using a variety of factors, such as age, health, driving history, policy length and coverage amount. Insurers use this information to estimate your life expectancy, and then they set your premium based on the risk of insuring you.

You can gauge the financial strength of a life insurance company through ratings agencies like AM Best or S&P Global. An insurer’s financial strength can give you an idea of how reliable the company will be in paying out a future claim. This is particularly important for life insurance as these policies often have to last decades. NerdWallet recommends looking for an insurer with an AM Best rating of B+ or better.

Life insurance premiums are typically based on your age and health, and they can differ significantly among policies. For example, the average monthly cost of a $500,000, 20-year term policy for a healthy 40-year-old is $26, according to Quotacy, a life insurance brokerage. To compare, the average monthly cost of a whole life policy with the same coverage amount is $547.

Term life is the most affordable type of life insurance. It lasts for a set number of years and does not build cash value. Term life is typically sufficient for most people.