Life Insurance for Young Adults

You have health insurance, car insurance, and renters insurance as a young adult, but do you have life insurance?

If you're thinking, "Isn't life insurance only for the elderly?" you're mistaken. Anyone who has dependents who rely on them for financial support should have a life insurance policy in place to ensure financial support in the event of their death.

You don't have to wait until you're grey to think about life insurance, nor does the process have to be time-consuming or expensive. Using StrongInsurance online comparison platform, you can obtain life insurance quotes at any time and from any location. StrongInsurance allows you to get quotes in minutes, whether you're between classes or meetings, on the subway, or late at night while watching Netflix.

Best Life Insurance Policies for Young Adults 

Life insurance policies are classified into three types: term life, whole life, and universal life. Term life insurance is the least expensive because it only provides coverage for the term of your policy, and when the term expires, your coverage terminates.

Whole life and universal life are both types of permanent insurance that will only expire if you stop paying your premiums or cancel your policy. Because these policies almost always result in a payout from the life insurance company, premiums are higher.

How much life insurance coverage do I need? 

To determine the amount of life insurance you require, multiply your annual income by ten. Then, adjust the amount based on your current and anticipated future circumstances.

Assume you earn $45,000 per year, your partner earns $50,000, and you have two small children. You'd want at least a $450,000 policy for yourself and a $500,000 policy for your partner.

Buying a large life insurance policy, on the other hand, isn't necessary if you're single and intend to stay that way. However, you must consider your future life plans, including whether or not a partner or children will be a part of them, and adjust accordingly.

Why do I need life insurance if it doesn’t benefit me?

Because term life insurance is so inexpensive, especially if you are young and healthy, purchasing a $500,000 policy for yourself will not be a financial burden. If you need more coverage, you can purchase another policy.

Even if you have no dependents or debts to pay, your policy can cover your funeral and burial costs, with the remainder going to your designated beneficiary. Beneficiaries can range from close friends and family members to charitable organizations and museums.

For millennials with student loans, keep in mind that if you have a cosigner, they are responsible for the bill if you fail to pay. When you die, a federal loan only in your name will be forgiven, but a private or co-signed student loan will still have to be paid from your estate. Consider purchasing a policy that is large enough to pay off these loans, credit card debt, or your car loan, allowing your family to easily pay the bills.

Finally, if you are convinced that you do not require a full life insurance policy, consider purchasing a final expense policy. It will be large enough to cover funeral and burial or cremation costs, ensuring that your family does not have to worry about money while they are grieving.

What happens to my term life insurance policy at the end of the term?

When your term life insurance policy expires, you must decide whether you require additional coverage.

You're older now, so your premiums will be higher, but you can still choose another term policy, a permanent life policy, or convert your current term policy to a permanent policy if it allows.

When purchasing coverage, you should select a term length that will provide coverage until you have enough savings or investments to ensure that your dependents will be able to live without your income. If you have or plan to have a family, purchasing a 25- or 30-year term policy at the age of 25 will protect you during the years when your partner and children are most reliant on your income. Your children will be young adults and no longer reliant on you financially by the time you reach the age of 55.

With the StrongInsurance comparison tool, you can determine how affordable life insurance is. In less time than it takes to order pizza, you can have a list of a dozen quotes from insurance companies.

Whole Life and Universal Life insurance Policies for Young Adults

Whole life and universal life policies, in general, are not suitable for young adults because they are permanent life insurance policies, which are more expensive because they provide lifetime coverage.

The additional cash value benefit of a whole or universal policy does not outweigh the savings from purchasing a term life policy and investing the difference in an index fund. Furthermore, your beneficiaries will only receive the face value of your life insurance policy if you die. So, even if you have a $500,000 policy with $15,000 in built-up cash value, your heirs will not receive more than $500,000.

A permanent policy would best serve a small number of young adults. One exception is if you are a cancer survivor or have a medical condition that precludes you from obtaining life insurance that requires a medical exam. Look for a guaranteed issue permanent policy that will insure you until you no longer have dependents who will financially rely on you.

Another circumstance in which a whole life or universal life policy would be advantageous is if you have a child who will require financial support from you even as an adult. You can seek advice from a financial planner on how to structure your estate plan and appoint a beneficiary.

Cheap Term Life Insurance Quotes for Young Adults 

Here are some of the most affordable term life insurance quotes for young adults for a 10-year term:

Use the StrongInsurance comparison tool to get a customized quote for your own life insurance policy. 

Best Life Insurance Companies for Young Adults

Life insurance companies provide comparable products, but some provide more specialized options. As a young adult, you are less concerned with a guaranteed issue or accelerated death benefit rider and more concerned with the price and coverage that will protect your loved ones from financial hardship if you die.

#1 Northwestern Mutual

Northwestern Mutual, the largest life insurance company in the United States, offers a variety of life insurance options for millenials. They provide a term life insurance policy that converts to a permanent policy with no medical exam as one of their financial products. This is an excellent way to take advantage of low life insurance premiums while also ensuring financial security as you age and without having to worry about a health issue affecting your ability to obtain coverage in the future.

#2 Guardian

Guardian, a household name in the life insurance industry with an excellent financial strength rating, offers underwriting on a wide range of life insurance products. It provides the option to convert a term policy to a permanent policy, as well as an add-on rider for premium waiver if you become disabled. It also provides a one-of-a-kind policy for people who have been diagnosed with HIV and may not be eligible for a policy with another insurer.

#3 Proactive

When purchasing life insurance, a 20-year term policy may be sufficient, but you may want to consider additional coverage. Proactive stands out in one area: riders that can be added to term life, whole life, or universal life policies. Riders are policy add-ons that will slightly raise the cost of your life insurance policy in order to provide additional coverage. You can add a rider to cover your children's final expenses, or an accidental death rider, which provides additional funds to your beneficiaries if your death is caused by a covered accident.

#4 AIG 

AIG is a life insurance industry leader with over 100 years of experience. One intriguing feature of its term life insurance policies is that they can be converted to permanent life insurance policies. The low monthly premiums associated with a term policy are more easily afforded by young people. However, if you want to keep your coverage, you can have the policy and premium payments changed to provide you with permanent coverage.

#5 Transamerica 

When you buy life insurance from Transamerica, you have a lot of options at reasonable prices, especially if you're a nonsmoker in good health. It provides a term policy with living benefits, which is a one-of-a-kind policy. This means that if you have a terminal illness, you can take an advance payout on your policy.

Find the Right Life Insurance Policy for You

You are aware of the importance of having life insurance in order to leave enough money to your dependents. StrongInsurance is ready to help you get quotes from 10 or more life insurance companies once you've determined the best type of life insurance for your needs and coverage amount.

Answer a few simple questions to receive instant quotes from the nation's top insurers. Compare them all in one place to find the best one for you. You can start the application process in minutes and have coverage today.