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Why Buy a $750,000 Life Insurance Policy?

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Insurance Quotes 2 Day Team

Written By Doug Mitchell

Doug Mitchell, CLU holds a BA degree in Finance from Auburn University, a Chartered Life Underwriter (CLU) designation from The American College in Bryn Mahr, PA and Top of the Table member of the Million Dollar Round Table (MDRT). Doug has spent close to 30 years in the insurance and financial planning industry and has held licenses to sell securities, long-term care insurance, health.  Doug is also a financial blogger addressing the topics of life insurance, annuities and retirement income planning.

Holly Mitchell  &

Holly Mitchell’s background in life insurance insurance goes back to 1985 when she worked for her father who was a New York Life agent. Holly has a marketing degree from Auburn University and has had a life insurance license since 2008. In addition to advising life insurance for customers all around the country, Holly is our website fact checker.

Rob Pinner   &

Rob Pinner is the founder and CEO of Pinner Financial Services servicing all 50 states. Rob started his insurance career in 2002.

Louis LaBash

Results-driven and innovative life insurance professional with 30 plus years of life insurance industry sales and marketing experience. Recognized as a pioneer in the field, leveraging phone and internet channels to exceed personal sales of over $100 million during the first decade of the 21st century. Creator of a highly effective intuitive IUL life insurance sales software that facilitated the sale of millions of dollars of indexed universal policies by numerous life insurance agents. Proven track record as a Managing General Agent (MGA), Life Agent, IUL Life Insurance Sales Software developer, and leading-edge creator of insurance marketing tools, educational content, and delivery systems.

 4 minute read

Wow! A $750,000 life insurance policy.

This may seem like a lot of life insurance for most folks, but when we really drill down into how much you need, this may not even be enough.

If you’ve watched any TV or go on social media, you’ve likely seen life insurance ads where the price seems just too good to be true and figured maybe it’s a scam.

The fact of the matter is term life insurance is cheaper than it’s ever been before, especially if you’re young, a non-smoker, and healthy. Since term insurance is temporary and most policyholders outlive their policy, insurance carriers pay far fewer claims for term than do for permanent insurance like Indexed Universal Life or Whole Life.

But, you may be thinking, why would middle America need a $750,000 life insurance policy? Keep reading and you’ll learn why you might need it and how little it can actually cost.

$750,000 is a big number, Why would you buy this much Life Insurance?

To help you understand why $750,000 in life insurance is not an unusual purchase, let’s do a case study on a hypothetical 30-year old married male with two children who wants to have enough life insurance to replace his income if he should die unexpectedly.

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Jason is a 30-year old married male with two children ages 4 and 6 years old. Jason’s wife, Emily, is currently a stay-at-home Mom working on a computer science degree online and does not currently have a steady income. Jason wants enough life insurance that will pay his family’s monthly living expenses for 5 years, pay off the $285,000 mortgage, pay for college for the kids, and provide a lump-sum investment for Emily’s retirement needs.


Jason decided ahead of time to call an old college buddy who’s an independent insurance broker rather than take the chance of making mistakes on such an important purchase. His college buddy, Eric, recommended that they go through a life insurance needs analysis to determine the amount of life insurance it would take to cover every issue that Jason is concerned about.

Using a free online insurance calculator, Jason and Eric were able to determine the financial needs of Jason’s family if he were to die unexpectedly. Here’s what that analysis looked like:

 Using a free online insurance calculator, Jason and Eric were able to determine the financial needs of Jason’s family if he were to die unexpectedly. Here’s what that analysis looked like: 
insurance calculator part 1


In this section, Jason entered his final expense (funeral & burial) costs which are estimated to be around $15k, his outstanding credit card debt that totaled $4,500 and his mortgage balance of $285,000. He also recorded the age of his children and what type of college he could afford to pay for.

insurance calculator part2



In this section, Jason entered what amount of income his family would need per year for 10 years but exclude the mortgage payment. He figured $3,000 a month would suffice.

Next, Jason entered that he has $4,500 in savings and about $56,000 in his 401(k). He also entered that he has a small Universal Life policy with a death benefit of $100,000.

insurance calculaotr part 3


The third section is where Jason would have plugged in the information about Emily’s income but it was left blank since Emily is a stay-at-home Mom in school for about 3 or 4 more years.

insurance calculator part 4

In this section, Jason estimates the rate of inflation and after-tax invest yield he can expect on his 401(k).

The Verdict

Now, after the click of the agent’s mouse, Jason’s life insurance needs are revealed.

And guess what? Yep, $750,000 ought to do it!

A Moment of Doubt

needs calculations

When Jason saw the number he needed to meet, he naturally had questions for his agent Eric but before he could get his first sentence out of his mouth, Eric clicked on the “See Calculations” link (not Eric’s first rodeo) and a calculations report popped on the screen in an instant. This calculations report provided enough information for Jason to ask just one question;  how much is a $750,000 life insurance policy? 

How much does it cost for a $750,000 Life Insurance Policy?


Although Jason wasn’t shocked when he saw the amount of life insurance it would take to financially protect his surviving loved ones, he was somewhat concerned if he could afford it.

As we mentioned at the beginning of this delightful article, term life insurance is an outright bargain, especially if you are like Jason who is young, in very good health, and doesn’t use tobacco products. 

 Here’s what we found for a $750,000 life insurance policy with 10, 20, or 30-year term. 
Age of Applicant 10-Year Term 20-Year Term 30-Year Term
25 $19.24 $25.99 $40.97
30 $20.24 $26.52 $44.05
35 $21.24 $28.61 $52.04
40 $25.55 $40.60 $73.45
45 $38.92 $68.23 $116.14
50 $59.38 $104.73 $189.26

When reviewing the rate chart for the various term periods, it’s quite apparent that the longer the policy is guaranteed for, the more it costs in terms of premium dollars.  The cost also vary by face amount. 

If you’re thinking about what happens when your term insurance policy is about to expire, you do have options:

  • Most insurance companies will allow you to renew your term policy on an annual basis with a new premium each year based on your attained age.
  • Many carriers include a term conversion option in their term policy which will allow you to convert some or all of your term insurance into a permanent insurance policy like whole life or universal life. Although your premium will be higher because of the lifetime coverage and the attained age you made the conversion, you’ll likely need less insurance coverage and your rate class will be the same as the rate class used when you purchased the term policy.
  • You can let your policy expire and purchase a universal life policy with a lower face amount but lifetime coverage. And, your new UL policy will earn cash value that you could withdraw in your retirement years.

You can get a better idea of policy cost by completing the quoter on the side of this page.

Frequently asked Questions

Do I have to have a medical exam for a $750k policy?

pass a life insurance medical exam

Actually, you do not have to have a medical exam. We represent several insurance carriers that will write policies up to a $1 million without requiring a medical exam or blood/urine tests.

Is a life insurance needs analysis free?

document in hand graphic

Insurance professionals will typically provide this service for free because it benefits the agent and the prospective client. Most people don’t know how to determine their life insurance needs and this is the best method if your intention is to replace your income when you die.

Do companies offer riders with larger policies?

Life insurance at 65.

Absolutely they do. Many consumers want to purchase more than just a death benefit. In fact, living benefits like the accelerated death benefit have gotten so popular that most companies include the benefit as part of the policy’s core coverage.

author avatar
Doug Mitchell, CLU Independant Advisor
Doug Mitchell, CLU holds a BA degree in Finance from Auburn University as well as having obtained a Chartered Life Underwriter (CLU) designation from The American College in Bryn Mahr, PA. Doug has spent almost 30 years in the life insurance industry and has also held licenses to sell securities, long-term care insurance and home and auto insurance. Doug is a Top of the Table Million Dollar Round Table member (MDRT).  MDRT is a global, independent association of the world's leading life insurance advisors.  For two years, Doug served as President of the Auburn Opelika Association of Financial Advisors and has been a member of the Million Dollar Round Table. He obtained Life Millionaire status at Horace Mann Insurance Company and was awarded the Life Agent of the Year Award. Later in his career with New York Life he was an Executive Council Member. Doug currently serves as President of Ogletree Financial, a managing general agency serving life insurance agents and clients in all parts of the United States. Today, Doug’s main focus is servicing 1000s of policyholders and growing the agency through the reach of

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