Average Life Insurance Policy Size Increasing

According to a new LIMRA study, the average life insurance policy size is increasing. In fact, the average life insurance policy size increased by approximately 25 percent from 2003 to 2005. You can calculate the amount of life insurance needed by multiplying your annual salary by the number of years left until retirement. The average life insurance policy costs 6 to 10 times the amount of your annual salary, and you can get free life insurance quotes below.

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Tim is a licensed life insurance agent with 23 years of experience helping people protect their families and businesses with term life insurance. He writes and creates stuff for QuickQuote and other insurance and financial websites.

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UPDATED: Oct 28, 2020

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According to a new LIMRA study, the average life insurance policy size increased by approximately 25 percent from 2003 to 2005. Universal life insurance policies saw the largest rate of growth, up roughly 60 percent for men and 45 percent for women. This is believed to be in part due to the increased number of universal life insurance products now offering guaranteed death benefits.

Term life insurance sales remained strong, with sales the strongest among the 25-54-year-old age group. Most insurance companies say that the life insurance policy cost is 6 to 10 times the amount of annual salary. Another way to calculate the amount of life insurance needed is to multiply your annual salary by the number of years left until retirement.

The following chart illustrates the preferred term lengths of term life insurance purchasers in 2005:

 Term Length in Years

 % of Policies

 10

 20

 20

 38

 30

 14

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