Do I Need Life Insurance if I'm Single?
 Written by Dan Marticio Dan MarticioDan Marticio is an insurance specialist for SmartFinancial. His past experience writing in small business and personal f... Read more |  Edited by Fran MajidiFran MajidiFran Majidi manages content on SmartFinancial's website. She's had nearly a decade's worth of experience writing about i... Read more |
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Even if you are single, life insurance may still be useful if you have others who financially depend on you, such as a younger sibling or an elderly parent. Qualifying for a business loan or repaying a loan you cosigned are other scenarios that may benefit from a life insurance death benefit, as well. See how else a life insurance policy can work for you.
Is Life Insurance Worth It if You’re Single With No Dependents?
If there are people you want to provide financial support after you die, then a life insurance policy can be worth it. In the event of your death, your beneficiaries are entitled to a tax-free death benefit, a full tax-free cash payout.
The death benefit will go to your beneficiaries even if you have outstanding debts. Whether it’s used to pay off a mortgage or student loan, the full cash payout will go to your beneficiaries specifically named in your policy.
When Life Insurance May Not Be Worth It
If you’re single and don’t have loved ones, charities or business partners you want to financially support after you die, then a life insurance policy probably isn’t worth it. Depending on your state, you may not even need to worry about settling existing debts. Also keep in mind that debts generally are not passed on to your next of kin and federal student loans are discharged after proof of death is submitted.
However, if you have a cosigner on, say a home or business loan, and they were to shoulder the full debt after you die, a life insurance policy may help pay your share of the outstanding debt.
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Scenarios Where Life Insurance May Be Worth It if You’re Single
Below are eight scenarios when a life insurance policy may be worth buying.
You Want To Cover Your Funeral Expenses
The average cost of a funeral ranges from $7,000 to $12,000. Part of your death benefit can go to paying your funeral expenses instead of leaving your loved ones with the full bill.
You Want To Lock In a Low Rate While You’re Young
Buying life insurance while you’re young, single and relatively healthy can help you lock in a lower lifelong rate if you choose a permanent life insurance policy. Age is a huge factor when calculating your premiums and younger people enjoy lower premiums than older people who have higher mortality rates. If you buy a policy at age 20, then you will pay the same premium until you die (assuming you maintain your premium payments).
Other People Still Depend on You
Your spouse may not be the only loved one who financially depends on you. Many people financially support their elderly parents who have expensive medical bills. Your younger siblings may depend on you for daily expenses. Or, you may be a guardian to a younger niece or nephew or an adopted child.
A life insurance policy can help ensure your loved ones have the means to support themselves after you die. If you get married later, you can always update your beneficiaries to include your spouse too.
You Need a Business Loan
If you need a business loan to pursue your entrepreneurial vision, purchasing life insurance may be a requirement. The lender will use the death benefit to cover the remaining balance if you die before it is repaid. Not all business loans will require you to take out a life insurance policy and it will depend on the lender.
You’re a Cosigner on a Debt
If you’re the cosigner on a loan, then your cosigner typically assumes full responsibility for repaying the loan after you die. This can be a significant financial burden if there is only one other cosigner. Your death benefit can help alleviate some of this pressure by repaying your share of the loan or even the entire loan as a gift to your cosigner.
There are several types of loans you may cosign for, such as a mortgage or car loan. Federal student loans are typically forgiven after you die but this may not be the case for private student loans. For example, if your parent cosigned on a private student loan but you were making the payments, they will be responsible for fulfilling the remaining payments.
You Want To Gift Your Loved Ones
A life insurance death benefit can simply serve as a farewell gift to your loved ones with no intended purpose, such as paying a loan or college tuition. The death benefit can simply be used however your beneficiary wants to use it.
There’s a Charity You Support
Your death benefit can go to a charitable organization you feel passionate about. You may want to donate your death benefit to your church, a local homeless shelter or a nonprofit with a mission you support, like environmentalism or solving poverty. A life insurance beneficiary doesn’t always have to be a specific individual and can support a mission instead.
Donating your death benefit to charity may offer some tax benefits. Generally, life insurance premiums are not tax-deductible but designating a charity as the policy owner and beneficiary may allow you to omit your policy premiums as taxable income.
You May Not Be Single Forever
Life insurance policies are generally long-term investments and your relationship status may change in the future. Fortunately, beneficiaries are not locked in and you can update your beneficiaries to include your significant other if you meet your special somebody.
Why Is Life Insurance Important for Someone Single?
Being single does not automatically eliminate the benefits a life insurance policy provides. While spouses and children are common life insurance beneficiaries, they are not your only options. Related loved ones who financially depend on you can also benefit from a life insurance death benefit. For example, an elderly parent with significant medical expenses or a young sibling who is not financially independent could use the death benefit as a financial lifeline after you die.
You could also designate a business partner if you cosigned on a commercial loan, a charitable organization you support and more.
Who Should Be the Beneficiary if You’re Single?
If you do not have a significant other, then you may want to designate any of the following as the beneficiary in your life insurance policy:
- Parents
- Adopted children
- Siblings
- Niece or nephew
- Close family friend
- Business partner
- Charity
Always Designate a Beneficiary
If you do not designate a beneficiary, then the proceeds will typically go to your estate — all the property you leave behind after you die. Your estate will be distributed through probate court and will likely be used to settle your outstanding debts before issuing the remaining amount to your next of kin, if there are any proceeds left. An estate tax may apply and reduce the total death benefit, as well.
To ensure the person(s) you want to receive the full death benefit, be sure to designate them as a beneficiary.
How Much Is Life Insurance Per Month for Someone Single?
Life insurance rates are heavily dependent on your age since older people generally have higher mortality rates than younger people. For example, insuring a child younger than 18 years of age can cost as low as $12 per month, while an adult age 50 may pay over $100 per month.
Below are sample rates for a whole life insurance policy with varying death benefit amounts. If you’re 30 years old or younger, you can expect rates cheaper than the ones listed below:
|
Age |
$50,000 |
$100,000 |
$250,000 |
$500,000 |
|---|---|---|---|---|
|
50 |
$116 |
$217 |
$531 |
$1,057 |
|
55 |
$144 |
$276 |
$678 |
$1,351 |
|
60 |
$182 |
$350 |
$865 |
$1,725 |
|
65 |
$234 |
$454 |
$1,123 |
$2,241 |
|
70 |
$314 |
$611 |
$1,518 |
$3,031 |
|
75 |
$429 |
$840 |
$2,090 |
$4,176 |
Source: Lincoln Heritage Life Insurance Company
Besides age, a life insurance company will typically consider the following factors when calculating your premiums:
- Health conditions (you will typically be required to take a medical exam when buying life insurance coverage)
- Health habits (e.g., smoking, drinking)
- High-risk extracurricular activities (e.g., skydiving, rock climbing)
- Coverage amount
- Type of policy (term life insurance is generally the cheapest option)
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Key Takeaways
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Shopping for life insurance? From term life insurance to whole life policies, SmartFinancial can help explore coverages and prices within your budget. To match you with the right policy at the best price, you just need to answer a few questions and enter your zip code. Or, call 855.214.2291 to get started on your life insurance free quotes.
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Dan Marticio is an insurance specialist for SmartFinancial. His past experience writing in small business and personal finance verticals has earned him bylines on prominent fintech brands, including LendingTree, ValuePenguin, Fundera, The Balance, and NerdWallet. His guides always aim to assist everyday consumers and entrepreneurs make informed decisions about their finances and business.
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