Florida life insurance rates, side by side

Life insurance is a contract with an insurer. You pay regular premiums, and if you die while the policy is active the insurer pays a lump sum, called the death benefit, to the people you name as beneficiaries. That payout is generally free of federal income tax and can be used for anything, from clearing a mortgage to replacing lost household income.

Term life covers a set period, commonly 10, 20 or 30 years, and pays out only if you die during that term. Permanent policies such as whole life are designed to last your entire life and build cash value over time. Term is usually far less expensive for the same death benefit, which is why it is often chosen to cover a specific window, such as the years until a mortgage is paid off or children finish school.

Final expense insurance is a small whole life policy, often between $5,000 and $50,000, meant to cover funeral and burial costs and the bills left behind. It lasts for life as long as premiums are paid, and the payout goes to your beneficiaries, who can use it for anything.

A common starting point is 10 to 12 times your annual income, though the right figure depends on your circumstances. A more careful approach is to add up what the money would actually need to cover — outstanding debts, the remaining mortgage, the income your household would lose, and future costs such as education — then subtract savings and any coverage you already have.

Age and health are usually the largest factors, alongside tobacco or nicotine use, the amount of coverage and the length of the term. Insurers may also weigh family medical history, driving record, and higher-risk occupations or hobbies. Because age and health both tend to work against you over time, the same coverage generally costs more the longer you wait.

Not always. Many traditional policies still involve a short medical exam with basic bloodwork, but a growing number of insurers use accelerated underwriting that relies on health questions and database checks instead. No-exam policies can be quicker to put in place, though depending on the insurer they may carry lower coverage limits or higher premiums.

Often, yes. Many final expense policies ask only a few health questions and need no medical exam. Guaranteed acceptance policies ask no health questions at all, but they typically pay a reduced benefit if death from natural causes occurs in the first two to three years.

Often not on its own. Employer coverage is typically limited to one or two times your salary, which falls well short of what most households would need. It also usually ends when you leave the job, so it is generally treated as a supplement to an individual policy rather than a replacement for one.

Yes, usually by a wide margin. Insurers treat tobacco and nicotine use as a major risk factor, and premiums for smokers are commonly several times higher than for non-smokers. Most insurers require a period free of nicotine — often 12 months or more, though it varies — before they will consider you for non-smoker rates.