Best Life Insurance for Young Adults
Updated: December 16, 2024
If you’re a young adult, you might assume you don’t need life insurance. But getting a life insurance policy now can be a smart financial move for your future. We’ve analyzed term life rates and coverage details to present the best options for young adults.
Our Expert Picks
- Symetra
- Lincoln Financial
- Pacific Life
- Principal
- Protective
- Ameritas
Best Life Insurance Companies for Young Adults
Symetra
- Forbes Advisor Rating: 5.0
- Plan Name: SwiftTerm
- Minimum Face Amount: $100,000
- AM Best Financial Strength Rating: A (Excellent)
Symetra earns a top spot for offering the lowest average term life insurance rates for 20- and 25-year-olds. If you qualify, you can buy coverage online with instant approval.
Pros & Cons
The SwiftTerm policy can be renewed until age 95, but rates will increase with each renewal. The Symetra website provides useful policy-specific information for young shoppers. Conversion to a permanent policy is available up to age 70. The maximum face amount of $3 million is lower than many competitors. Founded in 1957, Symetra has a shorter track record than some competitors.
Lincoln Financial
- Forbes Advisor Rating: 4.5
- Plan Name: TermAccel Level Term
- Minimum Face Amount: $100,000
- AM Best Financial Strength Rating: A+ (Superior)
TermAccel could be a good choice if you’re a healthy young buyer looking for a quick online process. While its term life rates aren’t the absolute lowest, it offers competitive features like renewability and conversion.
Pros & Cons
Policies are renewable up to age 95, though rates increase after the level term period. Conversion to a permanent policy is available up to age 70. Term life insurance rates for those aged 20 and 25 are average.
Pacific Life
- Forbes Advisor Rating: 4.5
- Plan Name: PL Promise Term
- Minimum Face Amount: $50,000
- AM Best Financial Strength Rating: A+ (Superior)
Pacific Life is another solid option for young adults, thanks to its low term life rates and flexible coverage options. PL Promise Term offers no-exam policies up to $3 million for healthy, young shoppers looking for a quick process.
Pros & Cons
Offers some of the lowest term life rates for young adults and a relatively high coverage amount ($3 million) for no-exam policies. It includes guaranteed renewability up to age 95 and conversion to a permanent policy (universal life policies only) is available up to age 70.
Principal
- Forbes Advisor Rating: 4.5
- Plan Name: Term Life
- Minimum Face Amount: $200,000
- AM Best Financial Strength Rating: A+ (Superior)
Principal’s term life insurance policy offers young shoppers low rates and convenient coverage options. Healthy young adults can potentially get up to $3 million in coverage with no medical exam required.
Pros & Cons
Young, healthy buyers may qualify for no-exam coverage up to $3 million. You can renew the policy to age 95 (with higher rates after the initial term). Term life rates are low. If you want to convert during the level term period or before age 70, you must purchase the conversion extension rider, which is not always the case with other insurers. The minimum face amount of $200,000 might be more than some young adults require.
Protective
- Forbes Advisor Rating: 4.5
- Plan Name: Classic Choice Term
- Minimum Face Amount: $100,000
- AM Best Financial Strength Rating: A+ (Superior)
Protective’s Classic Choice term life policy offers low rates and various level term lengths. It offers attractive 35- and 40-year term options, allowing young buyers to lock in rates for a longer period.
Pros & Cons
The Classic Choice policy is renewable until age 95, with higher rates at each renewal. Conversion options include up to 8 permanent life policies. Accelerated death benefits allow you to access only 60% or $1 million (whichever is less) of the death benefit if you have a life expectancy of 6 months or less.
Ameritas
- Forbes Advisor Rating: 4.0
- Plan Name: Value Plus Term
- Minimum Face Amount: $100,000
- AM Best Financial Strength Rating: A (Excellent)
Ameritas’ Value Plus Term policy offers young life insurance shoppers competitive rates and solid conversion options.
Pros & Cons
Ameritas offers competitive term rates for 20- and 25-year-olds. The policy can be renewed until age 95, with higher rates at each renewal. Conversion is available to all Ameritas permanent life policies. Conversion to a permanent policy is limited to the first 5 years of the term, unless with the conversion extension rider.
How Much Is Life Insurance for a Young Adult?
The average cost of term life insurance is around $31 a month for a healthy 20- or 25-year-old purchasing a 30-year, $250,000 policy. The specific rates from the top-rated companies can range from $14 to $19 per month.
Your actual cost depends on factors like age, health, the coverage amount and the chosen term length.
What Type of Life Insurance Should Young Adults Buy?
Term life insurance is often suggested for young adults because it’s the most affordable type. When comparing options, the first decision is between term and permanent life insurance.
Permanent life insurance options include whole life, universal life, variable universal life, and survivorship life. All of these include valuable benefits, but the best one depends on your unique financial situation and long-term goals.
When Should A Young Adult Buy Life Insurance?
It’s best to buy life insurance as soon as the need arises. This allows you to lock in a policy before any health conditions develop that might increase the cost.
Common situations when life insurance is worth considering:
- You Have Dependents: If anyone relies on you financially, life insurance is especially important.
- You Have Large Debts: Life insurance can pay off debts and protect your loved ones from that financial burden.
- You’re a Business Owner: Life insurance can help cover debts, operational costs, and payroll, or help ensure the business will continue.
How Much Life Insurance Does a Young Adult Need?
Estimate the financial obligations that need to be covered if you were to pass away. This could mean a policy large enough to replace your income, cover mortgage payments, debts, and living expenses.
The best way to determine your life insurance needs is to use a life insurance calculator.
