Average Cost Of a Million Dollar Life Insurance Policy For Men and Women

Here are the top best 1 million life insurance voted by readers and compiled and edited by our team, let’s find out

Depending on your age, previous medical history, and present health status, a one million dollar life insurance policy cost can vary a lot, so it’s best to shop around and get several quotes from industry experts.

Choose age bracket for your $1,000,000 life insurance policy:

Although for many people, $1 million or more worth of life insurance may be too much, there are many reasons why a person would want to consider this amount of term life insurance:

  • You may be a parent that wish to leave your spouse enough money to pay the mortgage, get the kids through college, and live a comfortable life.
  • You may be a high-net-worth individual that needs the insurance policy to cover estate taxes, final expenses, outstanding debts, etc.

How Much Life Insurance Should One Get

Let’s take the example of a man, father and husband, who earns $80,000 each year and wishes to take care of his family financially. To do this, he requires a minimum 1 million dollar life policy to 1.5 million.

Assuming that 1 million will generate an average of 5% interest per year, this would equate to a sum of $50,000, the 1.5 Million would net around $75K. As such, there would be no requirement to deplete the principal.

There is an argument however that a figure greater than $1 million will be required because currently it’s very difficult to find anywhere which would offer returns of 5%. Perhaps he would need a 2 million to 2.5 million dollar life insurance policy.

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Example best rates for a 20 year term, 1 million dollar policy, 2 million dollars, and 3 million dollars.

The monthly premium quotes below are for a male who is in excellent health and is a non-smoker. Do note, however, that a man or woman with a poor health history, smoker, or current medication use can potentially increase the premium.

07/12/2022 – These typical premiums are just estimates. Your average costs will most likely be different.

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If you earn between $80,000 and $100,000 per year, the recommended insurance coverage would rise up to around $2,000,000. If you are over 55, the rates won’t be cheap, but may be necessary.

If you take medication for diabetes, high cholesterol, or high or low blood pressure, you can still qualify in most cases. If your cholesterol or hypertension is well controlled, there is a still a reasonable possibility to qualify for the preferred rate classes, which are similar to the rates given in the table above.

With regards to diabetes, providing it’s well controlled and there are no additional medical issues, standard rates are easily obtained. Preferred (best) rates are also obtainable providing the diagnosis is recent with a low a1c, and you are not above the age of 55.

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No matter your age, 30, 40, 50, 60, 70, etc. It is easy to find out typical policy costs by clicking here!

Nevertheless, certain medical conditions can, of course, push you outside the preferred rate status.

Those medical conditions include the following:

  • History of heart disease (heart attack, bypass, stents, etc.)
  • Cancer
  • Obesity
  • Occupation, hobbies or regular travel which is hazardous in nature

Consider a 20 year term, $2 million policy for $847 monthly premium. There can be no argument that if you can afford the $847 monthly premium, this would make for an excellent investment.

Taking the scenario that you are 60 years of age and you invested in the $2 million 20 year term policy, and you lived for a further 10 years, your investment into the policy over that 10 year period would be just over $101,000. This equates to an internal rate of return at 63% per annum!

Looking at this same scenario from another angle. If you lived to 75, the rate of return would be some 32%, and if you lived to 80, the rate of return would be 20%.

There’s no doubt that this makes for a fantastic investment and there’s little chance you could possibly emulate this with any other type of investment vehicle.

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