How long should my life insurance coverage last?

How long your life insurance lasts depends on your financial needs. Most people need term life coverage that lasts 20 to 30 years.

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Amanda Shih

Amanda Shih

Editor & Licensed Life Insurance Expert

Amanda Shih is a licensed life, disability, and health insurance expert and a former editor at Policygenius, where she covered life insurance and disability insurance. Her expertise has appeared in Slate, Lifehacker, Little Spoon, and J.D. Power.

&Nupur Gambhir

Nupur Gambhir

Senior Editor & Licensed Life Insurance Expert

Nupur Gambhir is a licensed life, health, and disability insurance expert and a former senior editor at Policygenius. Her insurance expertise has been featured in Bloomberg News, Forbes Advisor, CNET, Fortune, Slate, Real Simple, Lifehacker, The Financial Gym, and the end-of-life planning service Cake.

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Kristi Sullivan, CFP®

Kristi Sullivan, CFP®

Certified Financial Planner

Kristi Sullivan, CFP®, is a certified financial planner and a member of the Financial Review Council at Policygenius. Previously, she was a regional consultant at Fidelity Investments for nine years.

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When buying a term life insurance policy, you need to decide how long you want your policy’s term (i.e., the coverage period) to last.

Choose a term length that is long enough to cover all of your financial obligations, but not so long that you’ll pay for coverage you don't need. If you have kids, you might need at least 20 years of coverage. To cover a mortgage, that number could be 30.

Key takeaways

  • Your term life insurance policy should last as long as your financial obligations and outstanding debts.

  • If you don’t get a long enough term length and need to buy more life insurance coverage in the future, your premiums will be much more expensive.

  • You can cancel your policy without penalty or lower your coverage amount if your needs change in the future.

How to choose your life insurance term length

A term life insurance policy’s term length is how long it will last before expiring. If you die during the term, your beneficiaries will receive a death benefit. Most term life insurance policies last 10, 20, or 30 years, but some companies offer additional five- or 10-year increments up to 35- or 40-years.

Match your term length to your financial situation. If you have a 20-year mortgage, then you’ll want a 20-year term to cover your mortgage payments. When your coverage expires, you should have enough savings and assets to self-insure, including for end-of-life care.

Calculate your coverage length

The best term length for your policy depends on the reason you’re buying the policy in the first place. Most people get life insurance to protect their family financially in case of an unexpected death. People often need a policy to cover:

  • A mortgage: New homeowners should consider a 30-year term since that’s likely how long your mortgage lasts. Even if you’ve taken out a 20-year mortgage, the cushion can help you if you refinance and circumstances change.

  • Co-signed loans: Whether it’s a private student loan for your child or a small business loan with a partner, your life insurance policy should outlast those debts so that your co-signers can keep up with payments. 

  • Their children: If you’re a new parent, you need coverage for as long as your children are financially dependent. That can be anywhere from 20 to 30 years if you plan to support past the age of 18.

Term length limits can also impact how much coverage you get, regardless of how much life insurance you need and can afford. Older people may be restricted to 10- or 20-year terms, especially once they reach their 60s and 70s. Each life insurance company has its own limits, so ask a life insurance agent about your specific situation.

Why you should consider a longer term length

Once you evaluate your financial obligations you can determine exactly how long your term life policy should last. But there are reasons it may be worthwhile to have a policy that lasts longer than necessary. 

1. Your life insurance rates are lower now than they’ll be in the future

The cost of life insurance increases 4.5% to 9% every year you age. New health issues for you or even for your parents, can mean higher rates when applying for a new policy. So if you buy a 20-year policy but still need coverage after it expires, your new premiums will be much higher.

Plus, inflation and industry changes mean you can’t predict what rates will be in 20 years. The rates for a 50-year-old can be costly enough now, but in 20 years they could be out of your budget.

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2. You’ll be ready for the unexpected

A shorter term length might make sense today, but you might need a longer term in the future. Maybe you’ll have another child, stop working, or need to take care of your aging parents. Your life insurance needs can change — and often grow — with these life events. 

A long-lasting policy can help with end-of-life expenses too. Nursing homes average $9,034 per month for a private room and the typical funeral can cost upwards of $7,000. [1] Even if your loved ones don’t count on your financial support, the extra coverage can alleviate the financial strain of your passing.

3. You can lower your coverage if you need to.

You could find that 20 years into a 30-year policy, you don’t need your life insurance coverage anymore. At that point you can lower the policy’s coverage amount, thus lowering your premiums, or you can cancel your policy altogether without penalty. 

You may have paid a little more to have the cushion coverage in case you needed it, but it’s better to have the protection. Otherwise, you would have paid much more for a new policy if you had needed the extra coverage.

How term length affects life insurance rates

The longer your term length, the higher your monthly premiums. Why? Because a longer term makes it more likely that the insurance company will have to pay out the death benefit. 

For example, a 35-year-old female would pay $25.18 for a 20-year, $500,000 policy. But she would pay $39.07 for the same policy lasting 30 years.

The advantage of buying a policy with a longer term is that you’ll have locked in affordable premiums if you need the coverage later. You don't want to overpay for coverage you can't afford, however, so find a term length that fits in your budget. 

Getting the right term length is pivotal to protecting the financial security of your family. A Policygenius agent can help you choose the right amount of coverage for your needs.

Frequently asked questions

How long is term life insurance good for?

A term life insurance policy typically lasts 10, 20, or 30 years. Some insurers offer longer or shorter term lengths between five and 40 years.

What happens to term life insurance when it expires?

If your term life insurance policy expires, your coverage ends and your beneficiaries won’t get a death benefit when you die. You can shop for a new policy or convert to permanent life insurance if you still need coverage.

How long should my term life insurance policy last?

Your term length should account for your longest financial obligations (a mortgage, child-raising costs, or outstanding debt) and how much you can afford to spend on monthly premiums.