If you're considering buying life insurance, now might be the right time to do it
- A term life insurance policy is an affordable way to protect your family, with many policies costing about $20 per month, though prices vary by person based on health and risk level.
- In 2019, life insurance got more expensive. Research by S&P Global Market Intelligence calculated that premiums rose by 4.1% over the year due to increased policy sales.
- In 2020, S&P projects that growth will be slower, with premiums only increasing by 1.4% over the year.
- If you've been considering buying life insurance, now might be the time to do it. Policies also tend to get more expensive as you age, so waiting for coverage won't make it more affordable.
- Policygenius can help compare life insurance policies to find the best coverage for you »
Life insurance premiums rose quite a bit in 2019.
Last year, several life insurance companies returned their best sales results in decades. According to data from S&P Global Market Intelligence, stronger-than-expected sales in the first nine months of 2019 raised premiums for term life policies over the year. But, after selling large numbers of policies in 2019, premiums aren't expected to continue the steep increases in 2020.
That's great news for anyone who's shopping for term life insurance coverage this year. With premiums seeing just about a quarter of the increase they saw last year, now is the time to get covered.
Premium growth is projected to slow in 2020
In 2019, S&P Global estimated that life insurance policy premiums rose by 4.1%. But in 2020, it's projecting a slowdown, with rates only rising 1.4%.
This small increase is only about a third of the amount that rates rose last year. Though it is still a 1.4% increase, it isn't much when you consider just how affordable life insurance premiums can be.
There are plenty of affordable policy options out there, and it's not uncommon for term life insurance policies to go for about $20 per month. For example, Business Insider contributor Clint Proctor got a $500,000 term life insurance policy at age 25 for $20.91 per month. And, there are plenty of companies offering life insurance, which allows you to find the best deal by shopping around for coverage.
While life insurance premium pricing varies by person and has a lot to do with health and risk levels, many policies are already fairly affordable. With premium increases slowing down in 2020, now is the time to get that policy you've been considering.
Getting life insurance now is probably more affordable than waiting
No sales growth or projections will change one inevitable truth about life insurance: It's almost always cheaper when you're younger.
The cost of putting off a life insurance purchase for a year far outweighs these rate increases. According to data from Policygenius, every year you wait under age 40 can add 8% to 10% to the cost of your premium.
Since you're not getting any younger, putting off that life insurance purchase another year or two will only make it more expensive. The longer you wait, the more expensive your coverage may be. With rate increases slowing in 2020, now might be the ideal time to lock in your rate.
- Shopping for life insurance? Get quotes from these Business Insider partners:
- Get quotes from Policygenius »
- Get quotes from Fabric »
- Get quotes from Haven Life »
- Get quotes from Bestow »
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