Term Life Insurance Coverage Minimum

UPDATED: Feb 25, 2020

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Q:  What is the minimum amount of term life insurance I can purchase?

A:  Most ‘major’ life insurance companies offer their term life insurance products at a minimum coverage amount of $100,000. A few will go as low as $50,000 (e.g. AIG American General Life Insurance Company and Genworth Life Insurance Company). Premium rates for these smaller coverage amounts tend to be higher per unit than those of larger coverage amounts (a unit equals $1,000 of coverage). Therefore, consumers interested in smaller policies should also review quotes for policies at the $100,000 coverage amount. The premium rates may be similar despite the difference in coverage amounts.

RBC Liberty Life Insurance Company and Garden State Life Insurance Company offer term life insurance coverage amounts as low as $25,000. This nice thing about these small policies is consumers can apply online or by telephone without having to take a paramedical exam. Coverage is usually approved or declined on the spot, and the policy can be paid for and put in force within minutes. This type of term life insurance is commonly referred to as Instant Issue Term or Simplified Issue Term.


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