Term life insurance policies come in a variety of term lengths, and one popular option is a 20-year term life insurance policy. These policies pay out a substantial death benefit to your beneficiaries if you die within the 20-year term. Your beneficiaries can use these funds to replace your income, pay off any debts, and cover end-of-life costs like funeral and burial expenses.

A 2020 study identified a “needs gap” of 41 million Americans who said they needed life insurance but don’t have it yet. Term life insurance is a great way to get affordable coverage, and suits many policyholders’ preferences and budgets. Let’s look at three groups of people that could benefit from a 20-year term life insurance policy.


1. Young families

Young families are great candidates for a 20-year term life insurance policy. The term is long enough to cover a child while they grow up, but the premiums can be lower than a 30-year term policy or a permanent policy. You’ll only pay the premiums when you really want coverage, and the policy ends when your child can support themselves.

A 20-year term life policy can cover your family during peak earning years if you’re young. This makes it easier to replace a high income and cover the expenses of raising a family.


2. Seniors

As you get older, your kids move out of the house and you pay down more of your debts, leaving you with fewer financial responsibilities. Life insurance premiums also tend to be much higher than earlier in life. This makes a 20-year term life insurance policy a great option for seniors who want great coverage but don’t need a permanent life policy. With 20-year term life insurance, you’ll get an affordable policy that covers you for a long time.


3. Homeowners with mortgages

Mortgages are large debts that take decades to pay off. If you die with an outstanding mortgage, your estate will be used to pay it off — leaving less for your partner or children. They may even have to sell the house to cover the mortgage.

A 20-year term life insurance policy can protect your assets and heirs if you die with an outstanding mortgage. Beneficiaries can use the death benefit to pay off the mortgage, allowing them to keep the house and receive more of your estate. Many mortgages are 20 to 30 years, and the term policy will cover most or all your years spent in payoff. Better yet, premiums will often be cheaper than payments for 30-year term or permanent life insurance policies.


Is 20-year term life insurance right for me?

A 20-year term life insurance policy is a great choice in many situations. Young families can take advantage of 20-year policies to ensure their children are financially protected and help their spouse replace their income during their peak earning years. 20-year policies also cost less than longer-term or permanent policies.

Many seniors can benefit from 20-year policies because they may have fewer financial responsibilities. 20-year policies can help save money without sacrificing coverage. Homeowners can also use 20-year term life policies to ensure their spouse and heirs can pay off the home’s mortgage without selling the home or harming the estate if they pass away. Always shop for multiple quotes before choosing a 20-year term life insurance policy, and compare policies to find good coverage at an affordable rate.