Most students don't need life insurance, but there are some who may need a policy to protect loan co-signers, spouses, or other dependents.
Some students with private student loans taken out before Nov. 20, 2018 may need life insurance to protect their co-signers. (A 2018 law requires private student loan debt after that date to be discharged if the student dies.)
Co-signers of private student loans taken out at any point may also need life insurance to protect the student-borrower, depending on the loan’s provisions. (Some private loan companies ask for immediate repayment if the co-signer dies.)
Federal student loans are forgiven if the student-borrower dies. (Parent PLUS loans are forgiven if the parent-borrower or their student dies.)
Students with dependents need life insurance to protect their families.
Life insurance for students with student loans
Sixty-nine percent of college students from four-year universities graduate with an average of $29,650 in student loans.  Most student loans are discharged in the event of the student’s death, but if you are a current or former student with co-signed private loans whose loans auto-default to the co-signer, you may need life insurance.
Do students with federal student loans need life insurance?
Students with federal loans don’t need life insurance to protect a co-signer, as federal loans are discharged after the death of the student borrower. Parent PLUS loans are discharged if the parent borrower or their student dies.
Do students with private student loans need life insurance?
Some students with private student loans need life insurance, depending on when the loans were taken out, whether they have a co-signer, and whether they are married and live in a community property state:
Students with private student loans taken out after November 20, 2018, with a co-signer, don’t need life insurance to protect their co-signers. Co-signers of private student loans taken out after Nov. 20, 2018 are protected by the Economic Growth, Regulatory Relief, and Consumer Protection Act,  signed into federal law in 2018, which releases co-signers from any obligation if the student borrower dies.
Students with private student loans taken out before Nov. 20, 2018, with a co-signer, may need life insurance to protect their co-cosigners. If the student dies, the co-signer will still be responsible for the debt, and depending on the provisions of the loan, it may auto-default with the balance due immediately. A life insurance policy covering the student with the co-signer as the beneficiary would ensure they could pay the balance of the loan if the student died.
Students with private student loans taken out anytime, without a co-cosigner, may need life insurance in some specific circumstances. If you took out a private student loan with no co-signer, upon your death, the debt will be likely canceled and no one would be liable for it — with a few exceptions. If you live in a community property state and took out a loan after you got married, that debt could become your spouse's responsibility after you die. Also, if you have an estate, the lender may attempt to get payment from the estate. In both cases, a life insurance policy could protect your spouse and/or heirs.
Do co-signers of private student loans need life insurance?
Some co-signers of private loans may want to have a life insurance policy to protect the student-borrower if the co-signer dies. Some private loan companies have provisions that auto-default the loan and request that the student pay the entire amount due immediately if the co-signer dies or files for bankruptcy.
Student borrowers and co-signers should check their paperwork, and if the debt does auto-default if the co-signer dies, discuss repayment expectations. The co-signer may want to have their own life insurance policy to ensure that the student can pay off the loan without the financial consequence. (An alternative would be to require the student to refinance the loan at that time.)
How much life insurance do you need to cover a student loan?
When buying life insurance to cover a student loan, or any other debt, the face amount of the loan isn’t enough. You need to plan for any interest that would accumulate over the course of the loan term as well so that you could cover the amount even as it gains interest.
To figure out how much life insurance coverage you need as a student-borrower, calculate:
The loan balance plus interest
The loan term
Private loans have the choice between fixed or variable interest rates. For variable-rate private student loans, the interest rate often starts around 3% to 4%, but it can increase to as high as 11%.  Fixed-rate private student loans typically have interest rates between 3% and 13%.
For example, if your interest rate for a private student loan is 7.99%, a $13,600 loan with a term length of 10 years will end up costing nearly $19,800 with interest. Account for the full amount when you shop for coverage and ensure the policy lasts as long as the loan will have a balance.
Can a co-signer buy life insurance to cover student loans?
A co-signer of a private student loan can purchase a life insurance policy on a student-borrower to protect themselves, but they need the student-borrower to be on board and share their medical history and maybe undergo a medical exam.
To buy life insurance that covers someone else — for example, a student loan’s co-signer — you need to prove insurable interest.
If you need to purchase a life insurance policy to cover a student loan, Policygenius works with over a dozen of the country’s top insurers. Our agents can offer you helpful advice while comparing insurance quotes.
Life insurance for students who are married or have dependents
If you have people that depend on you financially like a spouse, children, or other dependents, you need life insurance — even if you’re a student.
Even if you’re not making an income as a student, you may still be providing economic support to your spouse or dependents — especially if you’ve taken out loans to cover the cost of your rent, bills, or any other everyday expense.
If you die and can no longer help your partner pay the bills, they’re going to incur that additional cost.
Alternatively, if you performed any unpaid labor that would have to be replaced — such as child care, work around the house, or care for elderly parents — your partner would likely need to hire someone or take over the responsibility themselves and possibly take an income hit.
A life insurance policy can ensure that your loved ones aren’t struggling to pay some of the following expenses:
Rent or mortgage
Child care or dependent care
Generally, life insurance is meant to replace your income if you die, and the amount of coverage you can qualify for is based on your income.
If you’re earning an income while a student, you could get coverage based on that income. But if you need more coverage, or don’t have an income, there are other ways you could qualify:
Your spouse’s income: If you’re not earning an income at all while studying and your spouse works, you may qualify for life insurance based on their income.
Your projected income: If you’re in graduate school, law school, or medical school, some insurance companies will offer you coverage based on your projected degree and expected income.
→ Learn more about the types of expenses covered by life insurance
Maximum coverage available for graduate students by company
Life insurance company
Maximum coverage available
$1,000,000 for grad students; $2,000,000 for medical or law students
How to choose a life insurance company for college students
There are two main kinds of life insurance: whole life and term life. Term life is the right kind of life insurance for most people, and it's the kind of policy you’ll want to buy to cover a debt like student loans.
Term life insurance is significantly cheaper than whole life insurance and only lasts as long as you need coverage, whereas whole life lasts for a lifetime. The best term life insurance company for students will depend on their health profile and coverage needs.
How much does life insurance cost for students?
The cost of a life insurance policy for students depends on several factors, including:
The student’s age
The student’s health
Based on policies offered by Policygenius in 2023, a healthy 20-year-old with no family history of disease can get a 20-year, $50,000 term life insurance policy for just $10 to $13 a month. They may even be able to skip the medical exam and get coverage faster.
→ See the life insurance companies our experts recommend
Frequently asked questions
Do you need life insurance in college?
It's good to have life insurance if you co-signed a private loan or Parent PLUS loan with your parents. The payout protects them from your debt if you pass away.
What type of life insurance do college students need?
College students covering private loans should get a simple term life insurance policy that’s affordable and only lasts as long as it’s needed.
Can life insurance money be used for college?
A life insurance payout can be used for anything, including your child’s future or current college expenses.