How Much Does a Million Dollar Life Insurance Policy Cost?

A million dollar life insurance policy sounds like a lot, but for many families it’s a practical way to protect income, pay off a mortgage, and fund college if the worst happens. The right question isn’t “How much is a million dollar life insurance policy?” Rather, you should ask “How much is a million dollar life insurance policy for me, given my age, health, and term length?”

The answer depends on a few basics: whether you choose term or whole life, the length of the term, and your health profile. A $1 million term policy is often more affordable than people expect because it’s pure protection for a set period.

In fact, industry data tells us that the perception that life insurance is “too expensive” is the #1 reason people don’t buy.(1). Term insurance is typically the most affordable kind of life insurance, while whole life or other permanent options cost more because they’re designed to last for life and may build cash value.

In this guide we’ll show typical price ranges for a $1 million dollar life insurance policy, explain why some people pay less (or more), and share how to research quotes so you can see the numbers for yourself.

We’ll also cover million dollar life insurance policy cost differences between term and permanent coverage, and answer the most common questions in a quick, scannable FAQ.

For many healthy applicants, a $1 million term policy costs less than people expect because it’s pure protection for a set period. A recent evaluation says the average rate for $1,000,000 20-year term life policy costs around $94 per month, while a 30-year plan costs about $156 a month.(2) (This example assumes a healthy 40-year-old male. Actual rates vary by age, health, and carrier.)

Industry groups also note that million-dollar term premiums can start in the $30-a-month range for young, healthy shoppers, with costs rising with age and risk.(3)

The bottom line is that pricing for a $1 million dollar life insurance policy hinges on basics like age, health, gender (with rates often being less for women than men), smoking status, and term length. In general, older applicants who are applying for longer terms with higher coverage amounts will pay more than younger applicants who apply for shorter terms with lower coverage amounts.

Below are recent sample figures based on a healthy, non-smoking, 40-year-old. Rates are shown for both men and women. These should help give you a ballpark before you research your own quotes. Your price for a $1,000,000 policy will depend on your age, underwriting class, term length, and the carrier.

Permanent life insurance costs more than term because it’s built to last for life and often includes a cash value component. You’re paying for Iifelong protection, policy guarantees, and in most cases, an option to save money within the policy. Like term, your premium depends on your age, health, coverage amount, policy type, and how you fund the policy (level pay, limited pay, or heavier early funding).

For apples-to-apples comparisons, ask for an illustration that shows both guaranteed and non-guaranteed columns. Then compare those rates to any term quotes you’ve received. Here are two options you may consider if you’re looking for long-term coverage.

Guaranteed Universal Life (GUL)

GUL focuses on keeping coverage in force to a target age (often age 90, 95, 100, or 121) with a no-lapse guarantee, usually with little or no emphasis on cash value. Some people think of it as “lifetime term” with a premium schedule designed to maintain the guarantee, with less emphasis on growing cash value.

• Costs: All factors being equal (age, coverage amount, health, etc), rates are typically higher than term but lower than traditional whole life.
• What drives the premium: Issue age, health class, the guarantee duration you choose (e.g., to age 100 vs. 121), riders, and how precisely you follow the required premium schedule.
• What to watch: Missing or underpaying premiums can put the guarantee at risk. Some contracts offer a secondary no-lapse rider, but make sure you understand the funding rules that keep it active.
• Who it can benefit: People who want lifelong coverage at a more affordable price than whole life, and who don’t need to rely on cash value.

Whole Life Insurance

Whole life provides lifetime coverage with level, guaranteed premiums and guaranteed cash value growth as stated in the contract. Participating policies may also pay non-guaranteed dividends, which can be used to reduce premiums, taken as cash, or buy paid-up additions.

• Costs: Whole life is usually the highest premium option for a given death benefit because it layers guarantees and cash value on top of lifelong coverage.
• What drives the premium: Age and health at purchase, death benefit amount, whether the policy is participating (dividend-eligible), and the pay schedule (e.g., lifetime pay vs. 10-pay/20-pay). Limited-pay designs compress funding into fewer years, which raises the payment but shortens the pay period.
• What to watch: Smaller “final expense” whole life policies have modest coverage and simpler underwriting, so the monthly cost is lower than large, traditional whole life—but typically still higher than an equivalent term policy.
• Who it can benefit: People who value guarantees, level premiums, and the potential to build cash value over decades, and who are comfortable with a higher ongoing premium commitment.

Here’s a quick way to think about costs of these various policies before you research rates on your own.

• Term life $1M coverage: As shown in the table above for a 40-year-old nonsmoker, ballpark averages range between about $60 - $130. Younger, healthy applicants often see lower numbers; older ages and smokers see higher ones.
• Guaranteed Universal Life (GUL) $1M coverage: Expect higher premiums than term for the same death benefit. Rates rise as you age, and with the guarantee duration you choose (e.g., to age 100 vs. 121).
• Whole life $1M coverage: Usually the highest ongoing premium for a given death benefit because it layers lifetime coverage with guaranteed cash value (and possibly dividends). For a million-dollar death benefit, you should budget for significantly more than term. For example, the average annual rate for a 40-year-old man for a whole life policy of just $500,000 a month is $6,387 per year.(4)

You should also be aware of a few variations that can impact rates for all types of policies.

• Smokers vs. non-smokers: Smoker rates are substantially higher across all policy types.
• Custom funding. Limited-pay designs (such as 10-pay) compress premiums into fewer years, so the monthly/annual outlay is higher even though the policy is paid up sooner.

Your actual price depends on your age, health, state, underwriting class, and the insurer. Use the same coverage amount and term period/guarantee period across carriers for a good comparison.

There are several factors that can increase or decrease your rate, and understanding these underwriting considerations will help you make an informed decision.

• Age and health. Younger applicants and those with strong health histories generally pay less. Conditions like diabetes, heart issues, or high BMI can increase cost.
• Tobacco or nicotine use. Any current use (including vaping in many cases) usually pushes premiums higher.
• Sex (as classified by the insurer). Female rates are typically lower than male rates, as females have longer life expectancy(5) and in theory will pay premiums for a longer time.
• Coverage amount and term/guarantee length. Bigger death benefits cost more. Longer terms (20 vs. 10 years) or longer GUL guarantees (to age 121 vs. 100) also raise premiums.
• Policy type. Term is usually the least expensive; GUL sits between term and whole life; traditional whole life is typically the highest for the same $1M coverage.
• Underwriting process. Fully underwritten policies can reward excellent health with lower rates. Simplified/no-exam options may trade speed and convenience for tighter eligibility and sometimes higher premiums.
• Riders and options. Add-ons like waiver of premium, chronic illness, or accidental death increase cost.
• Lifestyle and history. Risky hobbies (like aviation, scuba diving, rock climbing), certain occupations, a recent DUI, or multiple moving violations can affect pricing.
• Payment mode and fees. Annual payment is often cheapest; monthly drafts may include small modal fees.
• State and insurer. Premiums and product features vary by company and by state. It’s worth checking at least a few carriers.

Tip: when you’re comparing, hold everything constant (coverage amount, term/guarantee length, and riders) so differences you see are truly due to underwriting and carrier pricing.

It can be, if the amount lines up with your income replacement needs, debts, and the years you want coverage. Our coverage calculator can help you decide how much coverage you need, but in general, even a small amount is better than no life insurance at all if you have family members who are dependent on your income.

Cost-wise, term life coverage of $1 million is generally more affordable compared with permanent policies, which are priced higher because they last for life and include cash value.