How affordable is a $1 million life insurance policy?

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A $1 million life insurance policy is a good idea for high earners with financial responsibilities that would significantly burden their loved ones if they passed away. People with dependents, a mortgage, business obligations, or long-term financial commitments may find a $1 million life insurance policy beneficial. It ensures that major expenses – such as replacing lost income, covering outstanding debts, funding college tuition, or supporting a spouse – are covered.

“There are several different scenarios when one may need $1 million in life insurance. However, the most common need is this of young families,” says Zhaneta Gechev, founder of life insurance company One Stop Life Insurance in Las Vegas. “Typically, when we are young and have small children or people depending on our income, we need the most insurance. Many of my clients are in their 30s, just started a family, purchased a home, and are looking for affordable protection.”

How much a $1 million dollar life insurance policy costs depends on your age, health, unique profile, and the term length of your policy. Our data shows that applicants who are young and in good health tend to pay less for coverage. For example, a 30-year-old female purchasing a 10-year term pays an annual average premium of $301. Meanwhile, a 60-year-old female purchasing the same coverage pays an average annual premium of $2,228.

Who should buy a $1 million life insurance policy?

For high earners, a million-dollar policy helps bridge the income gap and provides financial security for their families. It’s also a common choice for business owners who need to protect their company or anyone who wants to leave behind a financial cushion for beneficiaries. Even for those without dependents, a policy of this size can help cover estate taxes or final expenses, ensuring that assets are passed on smoothly.

“I’ve found that a $1 million life insurance policy makes a lot of sense for individuals with significant financial responsibilities,” says Rees Odhuambo, former NFL player and financial health coach at ThriveXDNA. “Your income is a major support for your family’s day-to-day living and education costs. If you have large debts like a mortgage, this level of coverage can be a real lifesaver.”

While $1 million may seem like a large amount, experts often suggest coverage that equals 10 to 15 times your annual income to fully protect your family.

While not everyone needs this level of coverage, it can be essential for:

Primary income earners. If your salary supports your family, a $1 million policy can help replace lost income, covering daily expenses, mortgage payments, and future costs like education.
Parents with young children. Raising kids is expensive, and life insurance ensures they have financial security for childcare, school, and college tuition if something happens to you.
Homeowners with large mortgages. If you have a substantial mortgage, life insurance prevents your family from struggling with payments or selling the home.
Business owners. Entrepreneurs and business partners often use life insurance to cover debts, fund buy-sell agreements, or provide stability for their companies.
High-net-worth individuals. Those with large estates can use a $1 million policy to cover estate taxes, ensuring their wealth is passed on without financial strain.
Anyone with significant debts. If you have co-signed loans, private student loans, or other big debts, life insurance can make sure your family isn’t left struggling to pay them off.

Remember, a good rule of thumb is to have life insurance equal to 10 to 15 times your annual income. If you earn $75,000 to $100,000 per year, a $1 million policy can provide the right level of protection to support your loved ones and cover long-term financial needs.

“This isn’t about covering immediate costs; it’s setting up a long-term safety net for your family,” says Odhuambo.

What’s the average cost of a $1 million life insurance policy?

How much you pay for a $1 million life insurance policy will depend on your profile, but we can still give you a good idea of what to expect. The rates below are averages based on non-smokers who received a Preferred health rating.

How much a $1 million life insurance policy costs for a 10-year term

Age	Gender	Average annual premium
25	Female	$289
25	Male	$368
30	Female	$301
30	Male	$369
35	Female	$326
35	Male	$389
40	Female	$450
40	Male	$538
45	Female	$693
45	Male	$821
50	Female	$1,011
50	Male	$1,257
55	Female	$1,510
55	Male	$1,953
60	Female	$2,228
60	Male	$3,181
65	Female	$3,692
65	Male	$5,785

How much a $1 million life insurance policy costs for a 20-year term

Age	Gender	Average annual premium
25	Female	$413
25	Male	$552
30	Female	$446
30	Male	$574
35	Female	$526
35	Male	$637
40	Female	$726
40	Male	$897
45	Female	$1,093
45	Male	$1,418
50	Female	$1,611
50	Male	$2,193
55	Female	$2,529
55	Male	$3,517
60	Female	$4,321
60	Male	$6,205
65	Female	$8,113
65	Male	$11,675

How much a $1 million life insurance policy costs for a 30-year term

Age	Gender	Average annual premium
25	Female	$637
25	Male	$857
30	Female	$718
30	Male	$914
35	Female	$857
35	Male	$1,060
40	Female	$1,204
40	Male	$1,548
45	Female	$1,820
45	Male	$2,467
50	Female	$2,867
50	Male	$4,009
55	Female	$4,980
55	Male	$7,140

Note that rates weren’t available for adults over the age of 55 for 30-year terms.

How to get the best rate on a $1 million life insurance policy

A term life insurance policy is the most affordable way to get $1 million in coverage. Term life insurance is significantly cheaper than whole life insurance because it doesn’t include perks like cash value or lifetime coverage.

But that’s not the only way to get the best possible rate for coverage. Here are a few tips:

Compare quotes. Different insurers offer different rates, so shop around.
Maintain good health. Lowering blood pressure, quitting smoking, and maintaining a healthy lifestyle can help you qualify for better rates.
Work with an independent agent. They can help you find the best policy for your needs and budget.

A $1 million life insurance policy might be more affordable than expected, especially if you choose term life insurance. The key is finding a policy that fits your budget while providing the right amount of protection for your loved ones. Whether you’re looking to replace income, cover debts, or secure your family’s financial future, life insurance can offer valuable peace of mind.

Methodology

Average annual rates are calculated from Compulife for male and female non-smokers in a Preferred health classification and based in California.

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Nupur Gambhir

Managing Editor

Nupur is a licensed life, health, and disability insurance agent and an auto and home insurance expert. She has written extensively on insurance topics for QuinStreet’s CarInsurance.com, Insurance.com and Insure.com as well as for Bloomberg News, Forbes Advisor, CNET, Fortune, Slate, Real Simple, Lifehacker and The Financial Gym.