Is 20-year term life insurance a good idea?

A 20-year life insurance term can be a great option in many situations. Maybe you have kids in elementary school, and you only need life insurance until they’re out of the house. Or perhaps you want life insurance to give your spouse peace of mind while paying off a 20-year loan. Both are great reasons to choose a term policy. Ultimately, the best choice depends on your unique circumstances and your family's long-term needs. Make sure to consult a life insurance professional about your options.

How does 20-year term life insurance compare with whole life insurance policies?

Of the two policies, a 20-year term life insurance policy is the most affordable alternative. Whole life policy premiums tend to be much higher, but they also come with permanent coverage and the ability to build cash value, which term life policies don’t have. The right choice for you depends on your budget, financial responsibilities, and future goals.

What happens when the 20-year period is up?

At the end of your 20-year term policy, you can choose whether to renew it for a higher premium. You may also be able to convert the term policy to whole life insurance. If you decide you no longer need coverage, your policy will end and you can simply stop making payments.

Do premiums on a 20-year life insurance policy increase every year?

No. The premiums for most term life insurance plans remain the same over the policy’s lifetime. One exception is increasing term insurance, where your premiums will go up during the term along with the payout amount.

Do I have to take a medical exam to get a 20-year term life insurance policy?

Usually, yes. This exam is free to you and includes your height, weight, and medical history. A licensed professional may also take blood and urine samples. Your medical exam results help your insurance company determine your life insurance rates. The good news? You only have to take the exam once over your policy’s entire lifetime. Even if your health situation changes in the next 20 years, you’ll still be covered and your premiums won’t increase. Get our tips for taking a medical exam here.

20-Year Term Life Insurance

Want financial peace of mind while paying off debt, starting a family, or preparing for retirement? Explore whether a 20-year life insurance policy is right for you.

What is 20-year term life insurance?

As one of the simplest and most affordable types of life insurance around, term life insurance is a smart move for many families. These policies provide financial protection for a set period of time, called a term length. Term life insurance typically comes in term lengths of 10, 15, 20, or 30 years, making 20-year term life insurance one of the longer term options available.

The ideal term length for you depends on your current financial obligations and how long you expect them to last. When considering your financial responsibilities, make sure to include:

day-to-day living expenses
your mortgage
credit card debt
student loans
any other expenses your family would need to cover if you died

A 20-year policy is ideal for people who expect to have financial obligations that will end by the time the 20 years are up. If you have children who will be out of the house by then, less than 20 years to go on your mortgage, and no other big responsibilities on the horizon, this policy may be the way to go.

As with all life insurance, though, timing is everything. If you think you’ll still have a spouse or children depending on you financially in 20 years, a 30-year policy might be a better fit. On the other hand, if you just have a few years before retirement or expect to have all your obligations paid off in the next few years, buying a shorter 10-year or 15-year policy can help you avoid paying extra for coverage you don’t need.

How does a 20-year term life insurance policy work?

After you buy your policy, you’ll pay monthly or yearly premiums throughout the term length to keep your policy active. If you die during this time, your beneficiaries will receive a tax-free cash payment, or death benefit. With no strings attached, they can use this payment as extra income, to pay off debt or end-of-life expenses, or even save as an inheritance for your children.

At the end of the policy, you can decide to extend your coverage for a higher premium, buy a new policy, or simply let it expire, which would end your coverage and payments.

Benefits of 20-year term life insurance

Affordable premiums

Affordable premiums
Cover longer-term needs

Cover longer-term needs
Flexibility

Flexibility

You've got questions about 20-year term life. We've gotanswers.

A 20-year life insurance term can be a great option in many situations. Maybe you have kids in elementary school, and you only need life insurance until they’re out of the house. Or perhaps you want life insurance to give your spouse peace of mind while paying off a 20-year loan. Both are great reasons to choose a term policy.

Ultimately, the best choice depends on your unique circumstances and your family’s long-term needs. Make sure to consult a life insurance professional about your options.
Usually, yes. This exam is free to you and includes your height, weight, and medical history. A licensed professional may also take blood and urine samples. Your medical exam results help your insurance company determine your life insurance rates.

The good news? You only have to take the exam once over your policy’s entire lifetime. Even if your health situation changes in the next 20 years, you’ll still be covered and your premiums won’t increase. Get our tips for taking a medical exam here.