life insurance at age 19?

[MarcP1]

I was talking to my mom today, and she said it might be a good idea for me to get life insurance right now. Apparently, once you hit 20, 30, etc. your rates go up a lot? And if I get term life insurance right now, I will be able to keep the same rates for the rest of my life (which would end up saving me a lot of money down the line)...and she estimated I could get like a $1 million one for $10 or $20 a month. Is this accurate at all? Anyone else have any suggestions?

[disneysteve]

There is some truth to what she said but overall I'd disagree.

You should get life insurance when you need life insurance. Are you married? Do you have children? Is anyone financially dependent on your income? If the answer to all of those questions is no, you probably have no need for life insurance no matter how old you are.

Term insurance is quite cheap - she's right about that. But the difference between getting it at 19 or 25 or 30 is a matter of a few dollars per year, not nearly enough to justify getting it now just to have it.

Also, you aren't quite right that the rate would stay the same for your whole life. First off, you don't generally carry term insurance for your whole life. You typically only keep it until you have enough personal assets to self-insure. Second, the rate only stays the same for the length of the term. That might be 10 or 20 or 30 years. So if you bought a 20-year term policy at age 19, it would only cover you until age 39. At that point, you'd have to buy a new policy at the prevailing rates at that time.

[MonkeyMama]

If you can easily afford it, I think it is a very worthwhile purchase. I come from the standpoint that since we were on the young side when we bought our home/had kids/got life insurance that we got amazingly low rates. Enough that it does make a decent difference to our bottom line. PLUS, my spouse was diagnosed with a brain tumor around age 30. So we can no longer get the *uber young* or the *super healty* rates. I know plenty of people with significant health issues that cropped up in their 30s or even 20s - it happens. Most of them didn't get health insurance in time. (Our insurer told us that it is extremely rare for people to get the rates we did because we were so healthy when we applied. The thing is most people do not get insurance when they are young. Even when they need it. SO I think I understand how the healthy/young combo really paid off, from personal experience).

BUT, I think the problem is that a 19yo would probably tend to under-insure, which defeats the purpose a bit.

One thing to consider is that longer terms cost more, also, which may also defeat the purpose a bit.

I don't know how accurate that quote you mentioned was. If it is accurate, I'd personally be tempted to go for it. BUT, only if it were 30-year term. You probably won't get something so cheap for 30 years. So that will be your catch 22. IT defeats the purpose if it expires before you need it. Better to get a policy you NEED in your 20s or 30s than to put yourself in a situation where your insurance expires in your 40s/50s and you still need it. (Then it would likely be insanely expensive, or you may even be uninsurable).

I know my view will be different from everyone else, but you don't know how many families I know how rely very heavily on one wage earner and have absolutley no disability or life insurance. That is frankly the norm. This could be a smart investment for your future. & if rates go down later or you change your mind and think it's silly, then you just cancel the policy. There is not a lot of downside. I think if you wait until you are 25 though, you will save money you don't need to spend in the interim. If I were you I'd probably hold off a few years - you'd still be in GREAT shape.

[artwest]

In my opinion, if you are married then you should get 8-10 times your salary in term insurance.

If you are not married, I still think it is a good idea to get life insurance, however, I would suggest a 30 year term policy for only about $50,000. Once you get married, you can get another policy for the 8-10 times your salary.

Here is why I suggest getting a small policy now. You will still need to be buried when you pass away. A small policy will cover that. Another reason to buy insurance now is, as MonkeyMamma eluded to, if you should get some illness that will make it difficult or impossible to get life insurance, you will at least have a policy for the next 30 years.

Something to remember about term insurance is that you should be paying off debt (or staying out of debt) saving and investing so at the end of the term, you really won't HAVE to have life insurance.

[Robert742]

I would not buy term life insurance only because it costs slightly less than buying it at, say age 25.

Answering DisneySteve's questions will help us figure out if you have a need for life insurance now.

As MonkeyMama cautions, it is a good idea to buy life insurance at a young age to avoid the chance you can't qualify for life insurance in the future.

But if you are full time student without a steady income, it may not make sense to buy something you don't need now, you may drop in the future, only to have to buy it again at a higher rate in the future, because you are older or have health issues.

If you know you will be married with kids in the next 10 or so years, and you know you can keep up the payments, buying a longer term policy now might be a good idea. However, if one million dollars is more than 25 times your income, insurance companies may not sell you that much without a clear need for it.

If you are healthy, you should be able to get a great price at age 19 on a term policy to age 65, but it may be more than $20 month, unless you want a smaller death benefit. You could go with a 20 year or 30 year term policy with a guarantee to renew. The renewal rate will be a lot more at age 39 or 49, but it will give you an option to keep your life insurance if you still need it for several more years.

If you can't see yourself married or with kids in 10 to 15 years -- assuming you don't have them now, there may be a better use for your money.

[DebbieL]

I would buy it now while you are still very healthy (I'm assuming). When I was in my 20s, my older sister got ovarian cancer which makes it more difficult/expensive for me to get insurance. Do it now before anything happens to either you or an immediate family member that could skyrocket your rates. It is so inexpensive to get good term life insurance at your age. Listen to your mom, lol. I'm recommending this to my daughter too (she's just turned 19).

[jteezie]

You can probably wait a few years.. Lets say til age 25.

I recently got my term life insurance. It's still cheap at age 27.

[Denisem1]

The type of insurance your mother referred you to is called guaranteed level term life insurance, which is the most common type of term insurance purchased. Unlike other term insurance policies that increase in cost overtime, level term life maintains the coverage amount you desired at a fixed rate of premium for the rest of the term. Before the term expires, you should request for a renewability option so you can extend protection on the same policy for a nominal cost. However, make sure that your life insurance carrier provides a guarantee not to raise the cost of your annual premium, before signing any documents.


Denise Mancini
Disclaimer: I work for AccuQuote and this is my personal opinion.

[snshijuptr]

Just for comparison, my husband just got a 10 year $1M policy for $298/year ($24.83/month) at age 27. Find an insurance agent that you trust (try talking to anyone in finance that you might know) and ask them for a quote for someone at age 19 versus age 25. By the way, I was advised to get a shorter policy because I will probably want different coverage in 10 years due to a second child, buying a house, building our retirement, new jobs, etc etc.

[disneysteve]

Originally Posted by snshijuptr

I was advised to get a shorter policy because I will probably want different coverage in 10 years due to a second child, buying a house, building our retirement, new jobs, etc etc.

I disagree with this. I would go with the longer policy. 1) You can always cancel it. 2) You can always add to the coverage by taking a second policy. 3) You avoid the risk of something happening that makes you uninsurable during that period.

[LivingAlmostLarge]

What do you really need it for? We just bought some a couple of years ago and switched again to get more. Probably will cancel it when it seems unnecessary. If you don't have dependents why?

[DeansLane]

Yes I also think it is worth purchasing and also rate would stay the same for your whole life.

And I would like to say that it is good idea to be acted upon

[runawaykinms]

I have noticed a lot of responses are telling you to wait until you are older because the price won't change much.

However, as Debbie mentioned it is not the price you should be concerned about it is your health. You never know what could happen to you each day. If you do wait until you are 25 and something has changed in your health you may no longer be eligible for life insurance at all and therefore at that time when you need it(Married, own a home, have kids, etc) you won't be able to get it.

I say if you can afford it get it now and take away the risk. By the way find an amount you are comfortable paying each month and explore your options. I just ran a quote for a 19 year old for $500,000 policy was around $31 a month for 30 years. If you don't need that much(which you probably don't) but still want to get some coverage try a policy for $200,000 for around $15 a month.

[NetSkyBlue]

Are there age brackets with large rate rate differences? For example, at 28 am I going to lock in a rate that is significantly lower than if I wait till age 30, or will it only be a small amount of difference?

[Robert742]

Originally Posted by NetSkyBlue

Are there age brackets with large rate rate differences? For example, at 28 am I going to lock in a rate that is significantly lower than if I wait till age 30, or will it only be a small amount of difference?

No, it's not like auto insurance, where you sometimes see a big change in the rates at age 21 and 25 -- where the price goes down a lot. Or age 70, when some car insurance companies start to raise your rates again.

If your health stays the same, the life insurance rate gradually creeps up, if you put off getting a level term policy, as you get older.

In fact, as people live longer, and life insurance remains a very competitive business, if you are in good health 10 years from now, a new term policy could be less expensive than if you buy it now, even though you are ten years older.

If anyone has a term life policy they bought 10 years ago, you may want to check out a new policy to see if you can get more coverage for a longer term, for the same price.

[raza]

In my opinion, you are a bit too young to really need life insurance.

[LivingAlmostLarge]

I just bought $500k for my 32 year old self considered 33 for 20 years for $233/year or $20/month. I was offered 30 years for $349/year or $29/month. So I could be paying less than a 19 year old. I was approved by the way.

I bought $2M for 25 years for my DH on top of what he had. His policy was $898/year for a 34 year old guy. Bought it last month by the way from accuquote who put us with ING. I bought it mostly because our youngest kid will be at youngest 19 years old at the end of 25 years. Will we really it need it then?

If you don't have dependents why do you need $200k even? I see Debbie's point about uninsurable but you could buy life insurance through your work company if need be.

I think disability insurance is more likely than death to be honest. More people are disabled than dying and many can't work in the same type of jobs.

[DebbieL]

Again, I cannot emphasize enough - it's not just YOUR health that they consider. Do it young and hopefully before a family member has an early age cancer/stroke/etc. You never know what might happen, and then suddenly you are considered more high risk. Your payments will be so low at your age (and assuming your family isn't riddled with early onset cancers or anything like that) that you won't even miss the money you are paying.

[Robert742]

Originally Posted by DebbieL

Again, I cannot emphasize enough - it's not just YOUR health that they consider. Do it young and hopefully before a family member has an early age cancer/stroke/etc. You never know what might happen, and then suddenly you are considered more high risk. Your payments will be so low at your age (and assuming your family isn't riddled with early onset cancers or anything like that) that you won't even miss the money you are paying.

That's a very good point, Debbie. Family medical history will not make you uninsurable, but it can cost you.

Maybe we should make it simple: if you can afford it, and you know you are gonna need it, buy it -- and listen to your mom.

You may pay for it long before you have a need, but it's better to do that than to need it later and not be able to get it, if you develop health issues.

[LivingAlmostLarge]

Except you are paying an extra 10 years before you even need it. And if you are uninsurable in 10 years will $200k even be enough?