20-Year Policy vs. 30-Year Policy— Which One is For You?
Life insurance policies come with different term lengths for a reason. They range from one to 30 years, but most companies offer them between 10, 15, 20 or 30 years. Everyone’s needs are different, and life insurance is not a “one size fits all” type of deal. Many people, however, will find that a 20 or 30-year policy works best for their needs, especially if children or multiple family members are in the picture.
We work with over 60 different insurance companies, and have a lot of experience getting both 20-year and 30-year policies. Not every company offers 30-year policies, but we can help you get offers from ones that do. Keep reading to learn more about these term lengths to determine which is the best one for you.
20 year vs 30 year term: Policy Amount
Before you even decide what term length you want, you should consider how much you want your policy to be worth. Policies worth larger amount are going to cost more depending on the term length you want. So, decide whether you want a $50,000, $100,000, $250,000, $500,000 policy, etc. and go from there. Keep in mind that you can start comparing rates at any time using our online quote form, but take a look at the next section to learn more about rate differences.
Difference in Rates Between 20 and 30 year Term
Obviously, policies of different term lengths are going to come with different rate costs. Let’s look at an example based on real-life statistics. Joan is a 35-year-old female nonsmoker who is interested in a $500,000 term life insurance policy. She is in great health, and so she is eligible for Preferred Plus rates (the lowest ones).
For a 20-year $500,000 policy, Joan is likely to be offered the following rates:
Protective: $20 a month
SBLI: $20 a month
American General: $23 a month
Banner Life: $23 a month
MetLife: $24 a month
Genworth: $23 a month
ING: $24 a month
Transamerica: $25 a month
Prudential: $29 a month
Mutual of Omaha: $32 a month
For a 30-year $500,000 policy, Joan is likely to be offered the following rates:
SBLI: $32 a month
Banner Life: $34 a month
Protective: $34 a month
American General: $34 a month
Transamerica: $35 a month
Prudential: $37 a month
MetLife: $38 a month
So, as you can see, Joan’s rates start out instantly higher if she goes with the 30-year option, and she also has slightly fewer options as far as providers go. However, this may be the best option if she has younger children and/or multiple dependents. She is also fairly young and in great health, meaning she is unlikely to die any time soon, so a 20-year policy may not be long enough. Joan still shouldn’t wait until she is older to get coverage since anything can happen, so agreeing to a 30-year policy now is likely better for her family in the long run.
You can use our quote tool on this page to start comparing companies and rates today, or feel free to call us at 888-411-1329 to get a customized quote and learn more about getting the right life insurance coverage for you.