Updated: November 20, 2024
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It's important to prepare financially for your death by securing a life insurance policy to support your loved ones after you're gone. Having sufficient life insurance ensures that your beneficiaries have enough money after you pass away.
One of the most popular forms of life insurance is a 15-year term policy. MoneyGeek walks you through all of the essential details of 15-year term life insurance policies to help you determine if it’s a good fit for your needs.
A term life insurance policy usually provides you coverage for a set period. After considering your financial obligations, you can choose your term length — typically between 10 and 30 years. If you’re looking for simple and affordable life insurance, a term life policy is the best option.
With a 15-year term life insurance policy, you pay monthly or annual premiums for the term to keep your policy active. If you pass away during this period, your beneficiaries will receive a tax-free death benefit to help them navigate their financial situation after you’re gone. s Your beneficiaries can typically use the death benefit provided by a term life insurance policy to cover end-of-life expenses, daily bills, mortgages, charity goals, debts, long-term medical costs or dependent expenses.
For example, if you have children in elementary school, you can opt for a 15-year term life insurance policy to financially support them throughout their childhood and allow them to continue their education in case of your death.
If you're looking to buy a term life policy, you should consider your financial obligations first. A 15-year term life insurance policy is typically the best option for people who have a spouse or kids who depend on their income. It's also useful for those with a mortgage or loans to pay off or are a few years from retirement.
You should get a 15-year term life insurance policy if your children are young and you want them to have a good education and take care of their expenses in case of your death. It’s also a good idea to buy a 15-year term life insurance policy if you have a mortgage or are close to retirement. By doing that, your spouse won’t have to endure financial hardship if you pass away.
If you're in your 20s, buying a 15-year term life insurance policy can protect your parents from the burden of paying off your student loans in case of your death.
Getting a 15-year term life insurance policy has the following pros and cons:
The 15-year term insurance policy’s cost depends on various factors. On average, a term life policy with $250,000 worth of coverage can cost between $17.85 and $44.37 per month, depending on your age. For smokers, a 15-year term life policy may cost between a monthly average of $76.22 and $259.18, while people in poor health pay between $35.40 and $106.92 monthly, on average. If you have a high BMI, a term life policy would cost an average of $32.53–93.61. The cost increases with your age and the coverage amount.
MoneyGeek’s research shows that a 15-year life insurance policy’s rates depend on several important factors:
Age
Younger people usually get more affordable life insurance quotes because insurers consider them less risky.
Gender
Statistically, females have a longer lifespan than men. Therefore, they pose less risk and typically pay less for a term life insurance policy.
Health Status
Insurance companies usually look at your height and weight, medical records and your family’s medical history to determine if you have or may develop a health condition that can shorten your life.
Lifestyle
Lifestyle factors like your smoking habits and criminal record play a significant role in determining your policy’s cost.
MoneyGeek researched a 15-year term life insurance policy’s cost by age and coverage amount to help you understand how rates change.
Policyholder Age | $250,000 | $500,000 | $1,000,000 |
|---|---|---|---|
30-Year-Old | $17.85 | $22.31 | $38.79 |
40-Year-Old | $22.65 | $30.01 | $54.70 |
50-Year-Old | $44.37 | $66.89 | $120.41 |
Since people who smoke or have poor overall health are more likely to develop serious medical conditions, insurance companies consider them risky to cover. This perception is why these individuals often receive expensive life insurance quotes. MoneyGeek analyzed the cost of life insurance for people who smoke or are in poor health.
Policyholder Age | Smoker | Poor Health | High BMI |
|---|---|---|---|
30-Year-Old | $76.22 | $35.40 | $32.53 |
40-Year-Old | $114.13 | $49.64 | $44.61 |
50-Year-Old | $259.18 | $106.92 | $93.61 |
MoneyGeek analyzed the cost of a term life insurance policy by company and coverage amount to help you save time and money. Our analysis shows that Transamerica usually offers the most affordable life insurance policies with 15-year term lengths for all coverage amounts.
Company | $250,000 | $500,000 | $1,000,000 | |
|---|---|---|---|---|
1. | Transamerica | $11.71 | $16.13 | $22.89 |
2. | Mass Mutual | $13.43 | $18.88 | $28.96 |
3. | Nationwide | $14.29 | $19.06 | $28.06 |
4. | Mutual of Omaha | $14.57 | $19.52 | $32.49 |
5. | AAA | $16.24 | $22.36 | $36.20 |
6. | Progressive | $19.48 | $28.42 | $77.38 |
7. | Prudential | $35.59 | $33.57 | $65.32 |
MoneyGeek's research shows that Transamerica offers the cheapest life insurance policies for smokers, which can cost between an average of $35.13 and $103.02 per month, depending on the coverage amount.
Company | $250,000 | $500,000 | $1,000,000 | |
|---|---|---|---|---|
1. | Transamerica | $35.13 | $60.35 | $103.02 |
2. | Mass Mutual | $40.54 | $72.65 | $119.49 |
3. | Progressive | $44.21 | $77.38 | $180.54 |
4. | Nationwide | $46.32 | $128.11 | $232.39 |
5. | Mutual of Omaha | $48.13 | $87.68 | $168.67 |
6. | AAA | $48.71 | $89.98 | $151.20 |
7. | Prudential | $62.54 | $94.55 | $187.27 |
MoneyGeek's data shows that Mutual of Omaha typically offers the cheapest 15-year term life insurance policies for people who have poor health. On average, its policies cost between $14.57 and $32.49 monthly, depending on the coverage amount.
Company | $250,000 | $500,000 | $1,000,000 | |
|---|---|---|---|---|
1. | Mutual of Omaha | $14.57 | $19.52 | $32.49 |
2. | Transamerica | $18.21 | $28.10 | $44.75 |
3. | Mass Mutual | $22.64 | $36.86 | $62.64 |
4. | Nationwide | $25.14 | $36.53 | $61.94 |
5. | AAA | $25.82 | $43.66 | $78.80 |
6. | Progressive | $29.48 | $47.90 | $77.38 |
7. | Prudential | $30.99 | $52.39 | $94.55 |
MoneyGeek’s analysis shows that, when it comes to 15-year term life insurance, Transamerica offers the most affordable life insurance for older buyers. The average cost of this company's 15-year term life insurance policy is between $29.66 and $86.37 per month, depending on the coverage amount.
Company | $250,000 | $500,000 | $1,000,000 | |
|---|---|---|---|---|
1. | Transamerica | $29.66 | $52.03 | $86.37 |
2. | Mutual of Omaha | $35.13 | $62.18 | $117.73 |
3. | Nationwide | $35.20 | $59.82 | $105.34 |
4. | Mass Mutual | $36.06 | $63.69 | $114.22 |
5. | AAA | $45.25 | $77.73 | $129.91 |
6. | Progressive | $76.58 | $136.85 | $251.08 |
7. | Prudential | $87.74 | $67.83 | $133.85 |
When you reach the end of the 15-year term, your life insurance policy will expire. However, before it expires, you can either extend it, convert it into a permanent life policy, let it expire or buy a different one.
The decision to extend or buy a new policy — or let your current one expire — will depend on your circumstances. If you have people in your household who are still dependent on your income or have debts to pay, it’s best to extend your current term policy or get a new one.
However, if your spouse or children no longer depend on your income and you have no other financial responsibilities, you can let the policy expire.
By understanding the answers to some of the most frequently asked questions about this form of coverage, you can make an informed decision about purchasing 15-year term life insurance.
With a 15-year term life insurance policy, you pay monthly or annual premiums for the term to keep your policy active. If you pass away during this period, your family will receive a death benefit.
The cost of a 15-year term policy depends on various factors like your age, gender, health status, lifestyle and coverage amount.
Yes, a 15-year term life insurance policy can be extended after 15 years. You can also convert it to a whole life insurance policy or let your policy expire.
About Mark Fitzpatrick
Mark Fitzpatrick is a Licensed Property and Casualty Insurance Producer and MoneyGeek's Head of Insurance. He has analyzed the insurance market for over five years, conducting original research and creating personalized content for every kind of buyer. He has been quoted in several insurance-related publications, including CNBC, NBC News and Mashable.
Fitzpatrick earned a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He is passionate about using his knowledge of economics and insurance to bring transparency around financial topics and help others feel confident in their money moves.
