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Who needs a million dollar life insurance policy?

“More is better” might seem like the right approach for life insurance. Learn when $1 million in coverage makes sense and how to buy it.

Life is all about finding the right balance. The perfect blend of work and play, needs and wants, saving and spending.

You’ll face the same type of decision-making when shopping for life insurance. Purchasing too little coverage can leave your family underinsured, too much can have you allocating too much of your budget to life insurance.

If the unthinkable happened and your family faced a future without you, a life insurance policy is your family’s financial safety net. A good rule of thumb is to have coverage that’s about 5 to 10 times your annual salary. So if you earn $100,000 a year, a $1 million life insurance policy may be the right choice for you. Or if you earn less but have substantial debts like a mortgage or student loans, it could still be the right fit. A million-dollar term life insurance policy is probably more affordable than you think. A healthy 35-year-old woman can buy a 20-year, $1 million term life insurance policy from Haven Life for about $35 per month.

For those of you readers who want to understand all the factors that go into deciding if a $1 million life insurance policy is right for you, read on. If you want the cliff notes version to understand if it’s the right amount of coverage for you, try using an online life insurance calculator.

Eligibility for a million-dollar life insurance policy

If you’re thinking about buying $1 million in coverage, it’s important first to find out if you’re eligible. A combination of your age and salary information helps an insurer determine if you qualify for the amount of coverage you’re seeking. For most insurers, the maximum is anywhere between 10 to 30 times your annual salary with some variation based on your age. Typically, the younger you are, the higher your coverage eligibility is.

Most of the time, you’ll have no problem qualifying for the coverage you’re seeking if you’re employed (and assuming you’re eligible for coverage with your current health.)

Additionally, you should use your income as a barometer for how much coverage you really need. If you earn $30,000 a year, for example, $1 million in coverage might be excessive.

Rather than trying to guesstimate, an online life insurance calculator can help you find your ideal coverage and eligibility. This way, you can properly gauge your family’s needs without having to do any air-math during the process.

Determine if $1 million fits your life insurance needs

In general, you should get coverage that’s 5 to 10 times your salary, and make sure your coverage is enough to help account for:

  • Your mortgage and other significant debts
  • Child care and dependent expenses
  • Intentions to pay for your child’s education
  • Cosigned debts
  • Health care costs for a non-working spouse and children
  • The cost of a funeral and final expenses

After considering how your family could afford these expenses without your income, you might find that $1 million in coverage is just right. Or, you might decide that you’d rather have additional coverage to lock in affordably pricing for the next 10, 15, 20 or 30 years. Again, a life insurance calculator can factor in all this information to provide an estimate based on your family’s situation.

In situations where you’re considering the coverage needs of a stay-at-home parent, it can be a bit more difficult to determine the right amount of coverage since they don’t technically earn a salary. Typically, the child-rearing partner will be eligible for the same amount of coverage as the working spouse. And remember: yes, households should have coverage on stay-at-home moms and dads.

The price of a $1 million life insurance policy

It may surprise you how affordable $1 million in coverage can be. A healthy 35-year-old woman could purchase a 20-year, $1 million policy for about $35 per month. That’s a little more than $1 per day. Not a bad price for a significant amount of peace of mind. And, she gets to lock in that price for the next 20 years.

And remember, pricing for coverage is affordable the younger and healthier you are. That’s why, if you know you need coverage, you’ll want to lock in your lower rate now.

Rates are also impacted by the term length of policy you choose. A 30-year term costs more than a 20-year or a 10-year term.

The bottom line: Your age and health, the amount of coverage, and the length of your policy will all impact how much you pay for coverage each month.

30-year term life insurance rates
20-year term life insurance rates
10-year term life insurance rates
Source: Haven Life

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Choosing the right term length for you

Term life insurance is a simple, affordable type of coverage that lasts for a specific period of time – 10, 15, 20 or 30 years. You pay for coverage during the years you need it most, until your kids are adults or your mortgage is paid off.

Picking the right term length is, again, all about balance.

A life insurance calculator will take into consideration your age, income, debts and family structure debts to provide a recommended term length as well as coverage amount that might be best for your situation.

A longer-term policy will cost more, but it also lets you use your current age to lock in a lower rate for a longer period of time. A shorter-term policy costs less per month for now, but when the term expires, you may still be in need of coverage. In that scenario, you’ll need to either buy a new policy or extend your coverage. Regardless, rates will be significantly higher because you’ll be quite a bit older.

Buying a million dollar life insurance policy

You purchase a million dollar life insurance policy to help financially protect your family in the worst of times. Therefore, it’s important to choose a company that you’re confident will be around for the life of your policy. Life insurance ratings are important to consider when shopping for a policy.

Life insurance companies receive ratings from independent agencies based on their financial strength, as well as the rating agency’s assessment of the company’s claims-paying ability. To put it simply: It’s an indication of the insurer’s ability to pay out a claim if you were to die.

For example, at Haven Life, our Haven Term policy is issued by MassMutual, which is rated A++ by A.M. Best. That’s the highest rating available from A.M. Best.

And thanks to modern technology, buying life insurance today is simpler than ever before. You can simply calculate your needs, get a quote, apply online and, if approved, start your coverage in the same day.

The online application will ask about your income, your family structure, and your health. Answer each question openly and honestly for the most accurate pricing and results.

At Haven Life, it’s even possible to buy up to $1 million in term life insurance without needing to take a medical exam. That’s because, in partnership with MassMutual, Haven Life has built technology that can analyze application information in real-time. If the life insurance company has a good enough understanding of your health and risk, the formality of an exam may not be needed. (However, it’s very important to be honest when completing the application. The issuance of the policy or payment of benefits depends on the truthfulness of answers in the application.)

Once an application is submitted, Haven Term applicants will know if a medical exam is needed to finalize coverage. In most cases, you will have temporary coverage in the time between application submission and when we receive the medical exam results.

You don’t have to predict the future

One downside of getting life insurance is that it makes you contemplate your own mortality, but that comes with an upside. By considering what would happen to your loved ones if you died, you also have to consider what you’re worth, financially speaking, and the answer is often a lot more than you think.

The best way to figure out how much life insurance coverage you might need, and how much you’re eligible for, is to use an online life insurance calculator like the one at Haven Life. In a few minutes, it can help you determine you and your family’s needs, and give you a personalized quote for coverage. After considering how your family could afford these expenses without your income, you might find that $1 million in coverage is just right, or you could discover that you need a bit more or a bit less.

So who needs a $1,000,000 life insurance policy? The answer may well be “you.” To find out for sure, try Haven Life’s easy-to-use life insurance calculator.


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Michael Davis is a freelance writer and editor who has covered everything from fashion and music to parenting, work, and finance. He has been a chef, restaurateur and record label owner.

Financial strength ratings are as of September 24, 2019: A.M. Best Company: A++ (Superior; top category of 15); Fitch Ratings: AA+ (Very Strong; second category of 21); Moody’s Investors Service: Aa3 (High Quality; fourth category of 21); Standard & Poor’s: AA+ (Very Strong, second category of 21). Ratings are for MassMutual (Springfield, MA 01111) and its subsidiaries, C.M. Life Insurance Co. and MML Bay State Life Insurance Co. (Enfield, CT 06082). Ratings are subject to change.

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Our editorial policy

Haven Life is a customer-centric life insurance agency that’s backed and wholly owned by Massachusetts Mutual Life Insurance Company (MassMutual). We believe navigating decisions about life insurance, your personal finances and overall wellness can be refreshingly simple.

Our editorial policy

Haven Life is a customer centric life insurance agency that’s backed and wholly owned by Massachusetts Mutual Life Insurance Company (MassMutual). We believe navigating decisions about life insurance, your personal finances and overall wellness can be refreshingly simple.

Our content is created for educational purposes only. Haven Life does not endorse the companies, products, services or strategies discussed here, but we hope they can make your life a little less hard if they are a fit for your situation.

Haven Life is not authorized to give tax, legal or investment advice. This material is not intended to provide, and should not be relied on for tax, legal, or investment advice. Individuals are encouraged to seed advice from their own tax or legal counsel.

Our disclosures

Haven Term is a Term Life Insurance Policy (DTC and ICC17DTC in certain states, including NC) issued by Massachusetts Mutual Life Insurance Company (MassMutual), Springfield, MA 01111-0001 and offered exclusively through Haven Life Insurance Agency, LLC. In NY, Haven Term is DTC-NY 1017. In CA, Haven Term is DTC-CA 042017. Haven Term Simplified is a Simplified Issue Term Life Insurance Policy (ICC19PCM-SI 0819 in certain states, including NC) issued by the C.M. Life Insurance Company, Enfield, CT 06082. Policy and rider form numbers and features may vary by state and may not be available in all states. Our Agency license number in California is OK71922 and in Arkansas 100139527.

MassMutual is rated by A.M. Best Company as A++ (Superior; Top category of 15). The rating is as of Aril 1, 2020 and is subject to change. MassMutual has received different ratings from other rating agencies.

Haven Life Plus (Plus) is the marketing name for the Plus rider, which is included as part of the Haven Term policy and offers access to additional services and benefits at no cost or at a discount. The rider is not available in every state and is subject to change at any time. Neither Haven Life nor MassMutual are responsible for the provision of the benefits and services made accessible under the Plus Rider, which are provided by third party vendors (partners). For more information about Haven Life Plus, please visit:

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