What percentage of whole life policies pay out?

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 y

What percentage of whole life policies pay out?

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.

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 isnt 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 betweenpremiums for men and women(with women paying nearly 1/4 less than men, on average)

Best life insurance companies ranked by customer satisfaction

When youre working with an insurer to secure a life insurance policy, customer experience matters. After all, youre 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]State Farm822Nationwide813Northwestern Mutual807Pacific Life801Mutual of Omaha795Globe Life788MassMutual782John Hancock781New York Life777Principal Financial776

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.25Female$14.21$21.09$33.54Male$17.18$26.97$44.7935Female$16.55$25.53$42.76Male$18.85$30.32$51.8745Female$28.85$47.94$86.87Male$35.55$60.80$112.9455Female$61.54$109.11$208.38Male$84.84$151.65$284.76

Methodology: The chart above reflects rates, as of June 2, 2022, 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 10 life insurance carriers that offer policies through the Policygenius marketplace: AIG, Banner Life, Brighthouse, Lincoln Financial, Mutual of Omaha, Pacific Life, Protective, Prudential, SBLI, and TransAmerica.

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]Alabama39.35Alaska7.36Arizona49.80Arkansas20.57California356.98Colorado58.26Connecticut42.35Delaware21.50District of Columbia10.59Florida188.85Georgia110.82Hawaii11.13Idaho12.88Illinois135.54Indiana48.87Iowa30.28Kansas26.55Kentucky34.21Louisiana47.66Maine8.31Maryland63.33Massachusetts91.68Michigan77.88Minnesota54.92Mississippi22.95Missouri55.01Montana7.40Nebraska18.60Nevada23.84New Hampshire12.63New Jersey121.35New Mexico11.52New York218.55North Carolina101.19North Dakota7.70Ohio107.83Oklahoma27.73Oregon31.36Pennsylvania121.21Rhode Island8.37South Carolina51.11South Dakota13.31Tennessee66.40Texas275.72Utah34.38Vermont7.91Virginia85.61Washington63.55West Virginia8.88Wisconsin75.73Wyoming4.59

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]New York Life6.75%Northwestern Mutual6.52%MetLife (Metropolitan Group)6.05%Prudential5.80%Lincoln Financial4.83%MassMutual4.57%State Farm2.87%Transamerica (AEGON)2.80%John Hancock2.73%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%.201163%201259%201362%201457%201557%201660%201759%201859%201957%202054%202152%

Number of life insurance policies purchased in the US from 1998 to 2018

According to the NAIC, heres the number of life insurance policies purchased in the U.S. each year from 1998 to 2018. [7]199831.89 million199938.58 million200033.36 million200140.1 million200238.71 million200335.77 million200438.45 million200534.52 million200629.29 million200730.79 million200828.6 million200929.19 million201028.62 million201127.18 million201227.06 million201325.26 million201427.15 million201528.32 million201627.52 million201728.04 million201827.80 million

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