Are you looking for long term life insurance coverage? Well alrighty then, you’re probably doing some research to find out if 30 year term life insurance works for you.
If that’s the case you’re in luck…
I’m going to walk you through your options AND provide some sample quotes to boot!
You wanna know the pros and the cons of longer terms? Betcha do! We’ve got you covered and I’m gonna share some insights into where you can find the best rates!
I WISH life insurance was a simple and easy process – but it’s not!
So let’s get the most bang for your buck because not all life insurance companies, terms or products fit everyone.
What Does 30 Year Term Life Insurance Mean?
Well, in a nutshell, people purchase 30 year term life insurance with level coverage to keep premiums fixed over a 30 year period.
As you get older, the cost to insure yourself increases, but if you select a 30 year level term you pay the average premium for those 30 years.
As we all know, health deteriorates with age. It’s a simple fact of life and insurance companies assess your premiums accordingly. Every insurer wants to do business with young healthy clients.
Why? Because they are very likely to outlive their coverage. Which means the life insurance company doesn’t have to pay out benefits.
So, they reward people who are young and in good health with inexpensive rates. That’s why I encourage clients to apply for life insurance when they qualify for the best premiums.
If you are in your 30’s and plan to have a family, it’s VERY likely that a 30 year term will cover those periods when you need protection the most – AFFORDABLY.
Psst! 30 year term life insurance no medical exam is a possibility.
So what are the ADVANTAGES of 30 year term life insurance?
I’m going to share them with you now!
Premiums are Fixed for 30 Years
If you get cancer or have a heart attack, you’ll retain coverage as if you were young and healthy. That being said, the premiums you pay are higher than 10 or 15 year terms because you’re locking in for a longer period of time. Which means more risk for the company! BUT at the end of the day having this sort of protection in place is one of the best things you can do to protect your family.
When the 30 year term is over, you may still convert the policy to Universal Life with no proof of insurability. This benefit can save you thousands by enabling you, regardless of health issues, to keep a policy in force.
Buyer beware: Not all life insurance companies offer this conversion option. Primerica is an example of an insurer that doesn’t offer it. Be sure to find out if your company does. All of the policies we sell at Huntley Wealth have this conversion option.
The Price is Amazing
30 year term life insurance is typically half the cost of a universal life policy but still provides comprehensive long term protection.
Sometimes the worst does happen, as Brent Mastin of Tampa, FL can attest to. His wife died of a brain aneurysm, but thankfully she had life insurance:
“My wife had posted this saying on Facebook maybe a year before,” Mastin says looking at a framed version of the text. “It says, ‘If I could give my daughter three things it would be to have the confidence to always know her self worth, the strength to chase her dreams, and the ability to know how truly, deeply loved she is.'”
The couple had bought life insurance to make sure their daughter would be provided for, “just in case,” Mastin said.
Then the worst case scenario unfolded just six months later.
YES, there are some disadvantages. Remember, one size doesn’t fit all when it comes to life insurance!
Check ’em out:
The Cost of 30 Year Term
30 year term life insurance costs more than lesser terms. Also, please don’t forget when your term expires you may still need coverage.
If you don’t have a good conversion option renewal rates can be astronomical.
Yes, this was listed as an advantage, but on the opposite end of the spectrum, some companies offer poor conversion options. Be sure to check the fine print when you purchase a policy.
Especially if you think there’s a chance you would like to convert. Frankly, if the company only allows you to convert to a whole life policy, I’d pass.
If you’ve been reading my blog, you know I’m not a fan of whole life insurance. It’s overpriced and doesn’t suit most people. But…back to my point about term and conversion.
You should buy a policy that will allow you to convert to ANY of the company’s permanent products.
The bottom line is: If you think you may need coverage for life, carefully compare 30 year term products. You want to make sure your policy contains comprehensive conversion privileges that include access to Guaranteed Universal Life to age 100.
Who Should Buy a 30 Year Term?
Anyone in their 20’s or 30’s should consider purchasing a 30 year term. If you are young, free and single you may think you’re in the clear. NOT THE CASE MY FRIENDS! If you are even considering a family it makes sense to weigh this option!
Let’s say you’re 28, a 30 year term will cover you until your 58! This will safely protect you through those periods of time when your kids and spouse count on your income the most!
Why Do You Need Life Insurance?
Life insurance is primarily purchased to replace lost income. Which means you need to sit down and think about how long you expect to work and what the needs of your family may be down the road.
Hey, don’t get me wrong, depending on your personal circumstances a shorter term may be more suitable. BUT you don’t want to be underinsured.
The good news is if you decide to opt out of your 30 year term policy you can simply stop making payments and voila! Your term is over. The commitment is minimal to say the least.
To save money, you may want to look into laddering your policies.
Huh? What does that mean?
Well instead of buying a 30 year term with $1 million in coverage, you break up the face value into increments.
Say let’s say you’re 32 years old and need $1 million in coverage because you have a mortgage and outstanding debt. You could simply buy a 30 year term with $1 million in coverage. This would cost a very healthy male non smoker about $715.00 per year.
But this client is savvy and has embarked on a strict savings plan. He intends to pay his mortgage and debt off in 20 years.
To save some cash he could take out a 30 year policy for $200,000 ($220.00 per year), a 20 year policy for $300,000 ($170.00 per year) and a 10 year policy for $500,000 ($160.00 per year). The policies drop off as he saves money and pays down debt. I also left him with a nice $200,000 cushion at the end because you never know what the future holds.
The difference in cost over 30 years of laddering policies?
$9,850 in savings!
What If I’m Over 50?
If you’re a 55 year old, non-smoking male in excellent health looking for $500,000 of coverage for the next 30 years – you are in luck! There are life insurance companies out there that will cover you.
Banner life premiums are only $240.00 per month if you meet their underwriting guidelines. Man, that’s pretty good. Who would have thought?
But what if this man lives past the age of 85? Hey, he’s in awesome shape and this is PRETTY darned likely! He doesn’t have any debt but would like to leave his heirs some money when he dies.
The only way to maintain guaranteed level premiums and a level death benefits for life is to purchase whole life or universal life policy with a guaranteed no lapse rider.
To be honest, the less expensive of the two is a guaranteed universal life policy which would cost him about $450 per month. Now that’s a pretty penny. This is one of the primary reasons so many people go with Term!
So What do you think?
Does a 30 year term make sense for this man?
Well, let’s look at his situation without the rose colored glasses. The most obvious reason this gentleman would consider purchasing a term policy is the SAVINGS.
If he opts for the Banner term policy I mentioned above he will shell out $90k over the 30 year term. If he decides to take the Guaranteed Universal Life policy it will cost him $162K over the same period. That’s a savings of $72K.
Ok, ok….so what if he outlives the term? Because he’s in great health, so this is a strong possibility (btw this is only true if he gets the best possible rating – the average male in the US will only live ’til he’s 80 according to the World Life Expectancy chart).
Well with a savings of $72,000.00, this client could invest the dough and come up with quite a nest egg for his heirs – even if he does outlive the policy.
Most importantly, if this gentleman follows my advice he will have selected a policy with a conversion option. So if this is a concern, he can covert the policy to permanent insurance up to 65 or even 70 years of age.
Well if you ask me, this is a no brainer. I would opt for term and invest the difference!
Should I Get A Shorter Term Life Insurance Policy?
I get it, I really do.
Those 10 and 20 year term policies with the appealing price tags are really tempting. You can get a lot of coverage for not a whole lotta cash.
If you are one of those uber responsible people you can pay down your debts during the period of coverage and sock away some money so you won’t need coverage 10 or 20 years down the line.
But how many of us are in that position? Life gets in the way. Emergencies happen and turn our lives upside down with NO warning whatsoever.
It’s also possible that your health will change and you will find yourself shopping for a policy older and in worse shape than you were 10 or 20 years ago.
While shorter terms are perfectly suited to some people – for others they are ill-advised. The important thing is to sit down and really acknowledge what you need to protect your family.
I bet the cost is more than you imagined. It is for most of us!
30 Year Term Life Insurance Savings Tips!
So Clearly You want to save money, and, I’m gonna show you how!
Compare Plans with Multiple Companies
The best saving tip I’ve got, regardless of the types of life insurance you’re interested in, is to compare prices.
Far too many people don’t realize just how different life insurance companies are.
Underwriting policies vary wildly as do offerings.
So let’s say you have a health issue such as:
- high blood pressure
- high cholesterol
- history of heart problems
Some insurance companies will penalize you more severely than others when it comes to specific maladies.
But that’s not all! I have two more savings tips for you:
Annuity Payout instead of a Lump Sum
This means the benefits are paid out over a period of time. This can save you 5% – 30%. Ask a Huntley Wealth agent for our “Pennies from Heaven Strategy”.
Ladder Your Terms
Use 20 and 10 year term policies to customize coverage for when you need it the most. This technique can save you 10% – 25%.
If you are looking for more saving tips check my article: 25 Best Ways to Save 50% (or More) on Life Insurance
Remember…You NEED the Right Insurer
As you can see your choice of insurer is VERY import. This decision could literally save you thousands of dollars.
I’ve included a few of them below, along with their product name:
- MetLife: Guaranteed Level Term 30
- Prudential: Term Essential 30
- Banner Life: OP Term 30
- Transamerica: Trendsetter LB 30
- Protective: Custom Choice UL 30
- SBLI: T-30
- United of Omaha: Term Life Answers 30
- American General (AIG): Select-a-Term 30 Year
The key is to know what their underwriting guidelines are BEFORE you choose.
Our Pick for the Most Reputable and Affordable 30 Year Term Carriers!
If you were to press me – and assuming you are in perfect health, the best rates tend to come from:
- United of Omaha
- American General
But that’s assuming you are in perfect health…
As I stated above, it’s not so much about flat pricing. You need to pinpoint the company that is willing to give you the best health rating. Be sure to get a quote from an independent agent like Huntley Wealth!
Depending on your provider, a policy can be up to five times higher for cannabis users. Certain companies will treat anyone that consumes medical or recreational marijuana like cigarette smokers.
I’m Coming to the End of My 30 Year Term
Well it’s time. You have officially outlived your 30 year term. If you ask me this is a win-win! You are a true hero. You protected your family and are still alive to talk about it. Be proud.
I’m not trying to scare you, but unexpected things do happen. I know a gentleman that went on an expedition in his early 30’s to Nepal. Sadly he never came back.
The most unfortunate part of the story is – he did not have life insurance. His wife and three kids were left holding the bag. Had they not been a part of an extensive and supportive community, they would have lost everything.
This is a word of warning for every parent.
As I mentioned above, once your 30 year level term has come to an end, the policy doesn’t necessarily expire.
MOST term policies provide coverage for your whole life, typically to age 95 – 99. The problem is, after the 20 or 30 year term expires, your premiums are no longer fixed and level.
Yep, they increase dramatically.
At this point, you have a few options:
- Continue to pay an ever increasing rate: This is known as renewable life insurance.
- Convert the policy to universal life or whole life insurance: This will give you guaranteed coverage on a permanent basis. That is….if you had the foresight to select a policy where this option is available.
- Go shopping: If you are still healthy, you might be able to replace your current 30 year term life insurance with a new 10 or 15 year level term policy. You’ll have to provide evidence of insurability, even if you purchase it from the same insurance company.
BUYER BEWARE: Recent Cancellations of 30 Year Term
….and why you should pull the trigger NOW
Over the past few years two major insurance carriers, Genworth and VOYA/Reliastar, discontinued their lines of 30 year term life insurance.
Genworth actually exited the market completely – but nonetheless, there seems to be a trend. Life insurance companies appear to be moving toward shorter terms.
Interestingly, VOYA also cancelled their 25 year term. The problem is, state governments mandate higher cash reserves for policies with longer guarantees. Which means shorter duration policies such as 10 and 15 year term are more appealing.
Combine that with my conversations with regional marketing representatives who all tell me how inexpensively priced 30 year term policies don’t make them any money….
Well let’s just say….
The writing is on the wall:
Other life insurance carriers in similar cash binds may either discontinue their products or increase premiums. I suspect we will see more of both in the near future.
SOOOOO if you are interested in a longer term such as a 20 or 30 years, you might want to consider locking in now. Don’t get me wrong, I sincerely doubt all carriers will discontinue their longer term products.
….BUT with very competitive companies exiting the market, availability could dwindle and costs could increase for the carriers who remain in the game.
Don’t worry if you have a 30 year term policy:
If you already own a 30 year term policy, don’t fret. Discontinuations will not affect policies that are already in force.
Why not go to sleep knowing that you have done everything in your power to enable your family continues to live the life they’ve become accustomed to…
…even if you are no longer present.*While we make every effort to keep our site updated, please be aware that "timely" information on this page, such as quote estimates, or pertinent details about companies, may only be accurate as of its last edit day. Huntley Wealth & Insurance Services and its representatives do not give legal or tax advice. Please consult your own legal or tax adviser.