Whole life insurance costs more than term, and in return it never expires and builds guaranteed cash value. Here is what shapes the price of a $100,000 policy and how to decide if it fits.
What sets the premium
- Age at purchase — premiums are lower the younger you start, and they stay level for life.
- Health and tobacco use.
- Gender.
- Payment structure — some policies let you pay over a set number of years instead of for life, at a higher annual cost.
What you get for the higher cost
Coverage that lasts your entire life as long as premiums are paid, a premium that never goes up, and cash value that grows at a guaranteed rate. Some policies from mutual insurers may also pay dividends, though dividends are not guaranteed.
When whole life makes sense
It often fits people who want certainty — a known cost, lifelong protection, and steady guaranteed growth — or who want to leave a defined amount to family or a charity. It is usually not the cheapest way to cover temporary needs like a mortgage.
Getting a real quote
Because premiums are locked in at your age and health when you apply, quotes are personal. Comparing two or three insurers is worthwhile, since pricing and dividend histories differ.
The bottom line
A $100,000 whole life policy is a lifelong commitment with a level premium. Its value is certainty — buy it for that reason, and buy it at the youngest age you reasonably can.
Learn about whole lifeThis article is for educational purposes only and is not tax, legal, or investment advice. Insurance and annuity products are not deposits, not FDIC insured, and not guaranteed by any bank. Guarantees are backed solely by the financial strength and claims-paying ability of the issuing insurer. Product features vary by insurer and state.
