Getting a life insurance policy is an important decision that you want to put a lot of thought into — it protects your family's financial security if you die unexpectedly. Because you're relying on your policy to protect your loved ones, you want to make sure you understand both the basics and the nitty-gritty of your coverage.
We've done the research so you don't have to: From how much life insurance costs to the biggest reasons to get it — we have answers to all your questions.
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Life insurance by the numbers
52% • Percent of American adults who have life insurance [1]
27% • Of American adults with life insurance, the percent who only have group coverage — which usually isn’t enough (and rarely stays with you if you leave your job) [2]
31% • Percent of consumers say they are more likely to buy because of the ongoing COVID-19 pandemic
10 to 15 times • The multiples of your annual income that most financial advisors recommend you need when buying life insurance for income replacement
29% • Percent of American adults who intend to buy their life insurance online
40% • Percent of insured who wish they had purchased their policies at a younger age
11% • Percent difference between life insurance ownership for women compared to men
$3.29 trillion • Face amount of life insurance policy purchases in the United States [3]
Stats about the cost of life insurance
5 to 15 times • How much more permanent life insurance (like whole life insurance) costs vs. term life insurance
4.5% to 9% • Average percent increase in your insurance costs as you age, assuming your health stays the same
23% • The average cost difference between sequential health ratings (Preferred vs. Standard, for example)
2 to 3 times • How much rates for smokers cost vs. rates for non-smokers (but a year after you quit smoking, most companies will offer you non-smoker rates
39.6% • The average difference between the least expensive and most expensive rate for the same person across insurance companies, based on Policygenius data
24% • Percent difference between premiums for men and women (with women paying nearly 1/4 less than men, on average)
Best life insurance companies ranked by customer satisfaction
When you’re working with an insurer to secure a life insurance policy, customer experience matters. After all, you’re trusting it to provide a payout to your loved ones if something happens to you. According to J.D. Power, these are the top 10 life insurance companies for customer satisfaction with their corresponding scores on a 1,000-point scale. [4]
Company | J.D. Power rating |
|---|---|
State Farm | 822 |
Nationwide | 813 |
Northwestern Mutual | 807 |
Pacific Life | 801 |
Mutual of Omaha | 795 |
Globe Life | 788 |
MassMutual | 782 |
John Hancock | 781 |
New York Life | 777 |
Principal Financial | 776 |
Average cost of life insurance by age and gender
The monthly cost of a life insurance policy depends on unique factors like your age, health, term length, gender, and the death benefit amount on the policy. The following are sample monthly premiums for a 20-year term life insurance policy for a non-smoker.
Age | Sex | $250,000 | $500,000 | $1,000,000 |
|---|---|---|---|---|
25 | Female | $14.17 | $21.06 | $33.45 |
Male | $17.11 | $26.89 | $44.62 | |
35 | Female | $16.39 | $25.43 | $42.49 |
Male | $18.58 | $30.14 | $51.51 | |
45 | Female | $28.31 | $47.71 | $86.45 |
Male | $35.11 | $60.58 | $112.52 | |
55 | Female | $59.80 | $108.44 | $207.17 |
Male | $82.80 | $150.39 | $282.99 |
Methodology: Average monthly estimated rates for male and female non-smokers in a Preferred health classification with a 20-year term length. Rates are based on the monthly Policygenius Life Insurance Price Index. Prices in the index are determined by internal actuarial rate tables for life insurance carriers that offer policies through the Policygenius marketplace: AIG, Banner Life, Brighthouse, Lincoln Financial, Foresters Financial, Mutual of Omaha, Pacific Life, Protective, Prudential, SBLI, Symetra, and Transamerica. Illustration valid as of 8/16/2022.
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Top reasons for buying life insurance in the U.S.
According to a 2020 report from trade research organization LIMRA and the non-profit organization Life Happens, these are the most common reasons Americans said they bought life insurance:
84% Burial/final expenses
66% Wealth transfer
62% Income replacement
57% Supplement retirement income
50% Pay off mortgage
Life insurance coverage by state
According to data from the NAIC, published by the American Council of Life Insurers, here is the cumulative value of the death benefits for the life insurance policies purchased in every U.S. state in 2018, in billions of U.S. dollars. [5]
State | Amount of coverage purchased (in billions of U.S.dollars) |
|---|---|
Alabama | 39.35 |
Alaska | 7.36 |
Arizona | 49.80 |
Arkansas | 20.57 |
California | 356.98 |
Colorado | 58.26 |
Connecticut | 42.35 |
Delaware | 21.50 |
District of Columbia | 10.59 |
Florida | 188.85 |
Georgia | 110.82 |
Hawaii | 11.13 |
Idaho | 12.88 |
Illinois | 135.54 |
Indiana | 48.87 |
Iowa | 30.28 |
Kansas | 26.55 |
Kentucky | 34.21 |
Louisiana | 47.66 |
Maine | 8.31 |
Maryland | 63.33 |
Massachusetts | 91.68 |
Michigan | 77.88 |
Minnesota | 54.92 |
Mississippi | 22.95 |
Missouri | 55.01 |
Montana | 7.40 |
Nebraska | 18.60 |
Nevada | 23.84 |
New Hampshire | 12.63 |
New Jersey | 121.35 |
New Mexico | 11.52 |
New York | 218.55 |
North Carolina | 101.19 |
North Dakota | 7.70 |
Ohio | 107.83 |
Oklahoma | 27.73 |
Oregon | 31.36 |
Pennsylvania | 121.21 |
Rhode Island | 8.37 |
South Carolina | 51.11 |
South Dakota | 13.31 |
Tennessee | 66.40 |
Texas | 275.72 |
Utah | 34.38 |
Vermont | 7.91 |
Virginia | 85.61 |
Washington | 63.55 |
West Virginia | 8.88 |
Wisconsin | 75.73 |
Wyoming | 4.59 |
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Biggest life insurance companies by market share
According to the National Association of Insurance Commissioners, these are the 10 largest life insurance companies in the U.S. and Canada, by their share of the total market. [6]
Company | Market share |
|---|---|
New York Life | 6.75% |
Northwestern Mutual | 6.52% |
MetLife (Metropolitan Group) | 6.05% |
Prudential | 5.80% |
Lincoln Financial | 4.83% |
MassMutual | 4.57% |
State Farm | 2.87% |
Transamerica (AEGON) | 2.80% |
John Hancock | 2.73% |
Minnesota Life (Securian) | 2.70% |
Percent of U.S. adults with life insurance (2011 to 2021)
According to the 2021 LIMRA and Life Happens report on life insurance in the U.S., the percent of U.S. adults who own life insurance has ranged between 63% and 52%.
Year | Percent of U.S. adults who owned life insurance |
|---|---|
2011 | 63% |
2012 | 59% |
2013 | 62% |
2014 | 57% |
2015 | 57% |
2016 | 60% |
2017 | 59% |
2018 | 59% |
2019 | 57% |
2020 | 54% |
2021 | 52% |
Number of life insurance policies purchased in the U.S. from 1998 to 2018
According to the NAIC, here’s the number of life insurance policies purchased in the U.S. each year from 1998 to 2018. [7]
Year | Number of life insurance policies purchased |
|---|---|
1998 | 31.89 million |
1999 | 38.58 million |
2000 | 33.36 million |
2001 | 40.1 million |
2002 | 38.71 million |
2003 | 35.77 million |
2004 | 38.45 million |
2005 | 34.52 million |
2006 | 29.29 million |
2007 | 30.79 million |
2008 | 28.6 million |
2009 | 29.19 million |
2010 | 28.62 million |
2011 | 27.18 million |
2012 | 27.06 million |
2013 | 25.26 million |
2014 | 27.15 million |
2015 | 28.32 million |
2016 | 27.52 million |
2017 | 28.04 million |
2018 | 27.80 million |
