How Long Should My Term Life Insurance Coverage Last?

There are a few important things to consider when picking your life insurance coverage term length. Not all of these will apply to your situation — and you may even have special considerations that aren’t on this list — but it’s important to think about all of the potential scenarios when buying a brand new policy.

Here are the biggest factors to keep in mind.

Your age

The average life expectancy in the United States right now is about 79 years, give or take. If you are 50 years old, this means that you have a life expectancy of about 29 more years; if you’re only 30 today, though, you can reasonably plan to be around for 49 more years or so.

Of course, no one knows exactly how long they will live, but the younger you are, the longer of a life insurance term you should consider buying. Not only will a longer life insurance term provide you with coverage for a greater period of time , but it will likely coincide with the years in which you earn the most money.

According to recent data, women are in their peak earnings period from the ages of about 44 to 53. For men, this is roughly from ages 52 to 57. During those ages, employed individuals are usually paying down the last of their debt and aggressively saving for retirement.

If you were to pass away during this time, the sudden loss of your higher income could financially impact the family you’d leave behind. If you didn’t buy a life insurance term that lasted long enough to cover this peak earning period, they would lose out on not only your paycheck but whatever savings you would have built up for the family’s future.

Be sure that the life insurance term you choose covers your earnings for as long as they will be needed.

Your mortgage

Buying a home is one of the biggest investments you and your family will likely make. This asset quite literally puts a roof over your family’s head… but that comes at the expense of a monthly mortgage loan payment, property taxes, insurance, and maintenance.

Consider how much longer you have on your mortgage when buying life insurance, and whether you should buy a term life policy that protects your loved ones until the home is completely paid off. Your death benefit could help cover the mortgage payment or pay off the home entirely if you were suddenly gone. Life insurance proceeds could also help cover the annual expenses on your home, even if the mortgage is paid off entirely.

Your children

One of the biggest considerations when buying life insurance is probably your kids. Providing for their upbringing, covering childcare expenses, and even paying for college (or other education) are all things to keep in mind when buying life insurance.

Depending on how old your youngest child is, you may want to buy a longer life insurance term. And if you hope to financially provide for your kids into young adulthood — especially while they are in college or getting started in their careers — this may mean adding some extra years to your coverage.

Your spouse

If you were to pass away tomorrow (or 20 years from now) how would your spouse or significant other be impacted? Would they suddenly bear the burden of household expenses on one income? Would they have enough saved for a successful retirement? Whether they work or stay at home now, would they need help with things like childcare, home maintenance, cleaning, or running errands, if they suddenly found themselves a single parent?

Think about how long you would like to provide for your spouse’s needs when choosing a life insurance term. Even if they have a great job and healthy income, your death benefits can provide for their daily expenses, help cover what you would have contributed to shared savings or retirement funds, or simply allow them to be financially secure for the rest of their life… no matter how old you are when you pass away.

Loved ones with long-term needs

Parents, siblings, a spouse, your own children… if there is anyone in your life who currently does — or may in the future — rely on you to help with their long-term needs, life insurance can help provide coverage for as long as you need it.

This is important if you plan to take care of your parents when they get older; if you’re gone, life insurance can allow them to afford care services or a nice living facility. If you have a child, spouse, or even an extended family member with long-term needs, consider these when choosing a life insurance term to ensure that they are always provided for.

In some cases, it may make more sense to purchase a permanent life insurance policy — such as whole life coverage — if someone you love has needs that will last their lifetime. Buying permanent coverage early on helps you not only save money on premiums but also provides them with a secure financial safety net long before it’s needed.

Other debt

Certain forms of debt will pass to your family when you die, either directly (especially if they are a co-borrower) or indirectly (by coming out of your estate). If you have shared credit card debt, auto loans, personal loans, co-signed student loans, and other similar types of debt, it’s important to buy life insurance that will last until these are paid off.

If your life insurance term ends before this debt is gone, your loved ones could see the whole balance fall on their shoulders. If the creditor files a claim against your estate, your loved ones’ proceeds could be seriously diminished after you die.

Your budget

Obviously, your budget will impact how much life insurance you can afford and for how long.

Generally, buying a longer life insurance term will be more expensive than buying a shorter term with the same coverage limits. Also, term coverage is generally about 5x cheaper than permanent life insurance.

You’ll have to find your own perfect balance to decide what your family needs and what you can realistically afford.

Shopping around and getting quotes for coverage, especially through a platform like LeapLife, can help you pinpoint the most affordable and trusted policy for you, from a number of highly-rated carriers.  

Your Term Options May Be Limited

Generally, most term life insurance carriers will offer coverage ranging from 10 to 30 years in length. There are some outliers offering as little as one year or as many as 40 years, sure, but the 10- to 30-year range is typical.

This means that you are already a bit limited in how long your term life insurance coverage can last. You can’t buy a term policy at age 20 that will last until you’re 90… at least, not without renewing and seeing your rates go up over time.

Additionally, you may find that the coverage options available to you personally could be limited due to certain factors. For instance, some carriers will only let you buy coverage up to a certain age; if that limit is 75 and you’re already 55, you won’t be able to buy more than a 20-year term policy.

Other factors that can limit your term options include tobacco use, family history, medical exam results, and the amount of coverage you wish to buy.

You Can Always Cancel Early

If you want to ensure that you have coverage that lasts as long as you could possibly need it, you have two options: buy a permanent life insurance policy, or buy the maximum term available to you. If you choose the latter, you can always cancel your policy early if you decide you don’t need it anymore.

This is usually the safest option. Rather than discovering that you still need life insurance at the end of a 10-year term — and having to renew at a higher rate due to increased age or even new medical concerns — it’s better to buy a longer policy term. If you decide 15 years into a 20-year term that you have too much coverage, you can usually cancel without any penalty.

Buying life insurance is a very personal process. The right policy for you may not be the right one for your friend, neighbor, or even your spouse, in some cases. Consider all of these important factors when deciding on your policy term, to ensure that you always have adequate coverage for those you love most.

Interested in the life insurance term options available to you? LeapLife can help. Our platform can match you with the perfect coverage for your loved ones through one of our trusted, A- (or higher-) rated life insurance partners. Coverage is available in all 50 states and it only takes minutes to apply online! Our agents are also available by phone if you have questions or need help building your policy.