Life insurance is a financial safety net that protects families if a provider dies. A 10-year term life insurance policy provides financial protection for 10 years at an affordable price. The premiums are fixed and you have a wide range of coverage amounts to choose from.
Not only are 10-year term life insurance rates affordable, but the policy can be an ideal fit for many stages of life. Whether it’s to protect retirement plans or cover mortgage payments, there are a number of scenarios where a 10-year term policy is a smart choice.
A 10-year term plan can help in the following situations:
- Couples with a home: It can help cover mortgage payments or pay off the house entirely.
- Young families: It can help cover credit cards, loans, daycare, and other living expenses.
- Families with older children: It can help cover tuition, weddings, and other financial milestones.
- Soon-to-be retirees: It can help ensure your loved one has the retirement they hoped for.
How much does a 10-year term life insurance policy cost?
The monthly cost for life insurance can vary, but a 10-year term life insurance policy is one of the most budget-friendly options because of the length of coverage.
In the table below, we compare the monthly costs for $250,000 in coverage across various ages. Rates are for applicants in excellent health who don’t smoke.
10-Year Term Life Insurance Rates by Age
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When does it make sense to get a 10-year term life insurance policy?
Secure a loan
A 10-year term life insurance policy is good choice in a number of situations.
The four most common scenarios we see and will expand on are:
- protecting your income,
- supplementing existing coverage,
- securing a loan,
- retirement planning.
1. Use a 10-Year Term Life Policy to Protect Your Income
Buy a 10-year term policy if it’s all you can afford.
You may have a lot of bills. Maybe you’ve got credit card debt. You couldn’t possibly afford to buy life insurance now, right?
Wrong. It’s in situations like these when you likely need life insurance the most and can’t afford not to have it.
If your income were to suddenly disappear, what would happen to your family? If you were already struggling financially, your death won’t make things easier. Final expenses—such as debt, medical bills, or your funeral costs—would be up to your family to pay.
A 10-year term policy can protect your income and your family’s future while you work toward paying off debt. Even if you can’t afford a large amount of coverage, would $100,000 of life insurance make a difference to your loved ones if you died unexpectedly?
In the table below, we compare the monthly costs for $100,000 in coverage across various ages. Rates are for applicants in excellent health who don’t smoke.
10-Year Term Life Insurance Rates by Age
A little bit of life insurance is always better than none at all.
See what you’d pay for a 10-year term life insurance policy
2. Use a 10-Year Term Life Insurance Policy to Supplement Your Existing Life Insurance
Buy a 10-year term policy to supplement your existing life insurance.
Perhaps you planned ahead when you were young and bought life insurance right after your first child. You locked in a great low premium payment for a 30-year $250,000 term policy. Perfect.
But 15 years later you’re now 40 and realize that your $250,000 term life insurance policy won’t cover your $400,000 mortgage. Instead of applying for a new 30-year policy with a $500,000 coverage amount, you can opt to add to your current coverage with a new 10-year $250,000 term policy.
This will ensure that you have an appropriate amount of coverage for the next ten years while you’re paying off your mortgage and helping your child(ren) through their college years—without being over-insured.
» See what’s right for your needs and budget with our Life insurance needs calculator
3. Use a 10-Year Term Life Insurance Policy to Secure a Loan
Buy a 10-year term life insurance policy to protect a loan.
Whether you need to take out a personal or business loan, lenders need to know how you plan on paying back the loan. They also like a back-up plan as assurance that they won’t lose money should you die unexpectedly before your loan is paid-in-full.
Lenders will be more inclined to approve your loan if you assign a term life insurance policy to guarantee payment even upon death.
4. Use a 10-Year Term Life Insurance Policy for Retirement Planning
Buy a 10-year term policy if you are close to retirement.
Most of the time term life insurance policies are purchased to cover the most financially vulnerable years, such as when your children are small and you’re paying off a mortgage.
Other times term life insurance policies are purchased to protect financial responsibilities that may crop up later in life, such as the purchase of a vacation home or your adult child’s graduate school tuition.
For example, let’s say you are 55-years old and you and your spouse finally buy that dream condo on the ocean. It will be a great place for your children and grandchildren to visit.
However, one of your children hasn’t finished college and tuition isn’t cheap. You have savings and your Social Security benefits will be starting soon. You want to be sure that if the unexpected happened, your spouse wouldn’t have to sell the condo and your child could finish graduate school.
In the table below, we compare the monthly costs for various amounts of coverage. Rates are for 55-year-old applicants in excellent health who don’t smoke.
10-Year Term Life Insurance Rates for 55-Year-Olds
What happens after the 10-year policy expires?
Once the 10 years are over, your coverage ends. Your premium obligations are over.
If an insured person dies while their term policy is inforce, their beneficiaries receive a death benefit check. If the insured person outlives the policy, no money is paid.
Many term life insurance policies have conversion and renewability options. If your term is set to end soon and you need more coverage, take a look into these options.
Utilizing the conversion option means that you would be changing your term policy into a permanent one. Your premiums will increase significantly, however, you do not need to prove you’re still insurable. Even if you were to develop a serious condition, such as cancer, the insurance company would allow you to convert into the permanent plan.
Utilizing the renewability option means you’d just be extending your same term coverage for one more year. Renewability premiums are much higher than your initial fixed premium.
If you have had no significant health changes while you owned the original 10-year term and you want more coverage, you may want to simply buy a new policy. Talk with a life insurance broker if you’re unsure which option is best for you.
Term life insurance is affordable and customizable. Unsure if 10 years is enough coverage to protect your loved ones? Other term length options include 15, 20, 25, 30, 35, and 40 years. Get a free quote instantly and apply online in minutes.
» Compare: Term life insurance quotes
Note: Life insurance quotes used in this article are accurate as of September 15, 2022. These are only estimates and your life insurance costs may be higher or lower.
About the writer
Natasha Cornelius, CLU
Senior Editor and Licensed Life Insurance Expert
Natasha Cornelius, CLU, is a writer, editor, and life insurance researcher for Quotacy.com where her goal is to make life insurance more transparent and easier to understand. She has been in the life insurance industry since 2010 and has been writing about life insurance since 2014. Natasha earned her Chartered Life Underwriter designation in 2022. She is also co-host of Quotacy’s YouTube series. Connect with her on LinkedIn.