If you are a police officer or first responder, you’ve likely already determined that you are in a risky occupation.

Every shift you are out there protecting the citizens in your community, there is always a risk that you might be injured or in the worst case, never make it home.

Knowing this, it’s critical that you take the necessary steps to ensure that if you don’t make it home, your surviving loved ones will have the financial resources to continue.

Many police officers and first responders are under the impression that life insurance companies prefer to pass insuring police officers, but the good news is that insurance companies understand the risk and many will compete for your business.

To put it bluntly, a lot more people die from car accidents each year than police officers getting killed on the job. Finding affordable life insurance if you’re a police officer is surprisingly easy.

Why is Life Insurance Important for Police Officers?
Let’s start with an important and confirmed statistic from Officer Down Memorial Page (odmp.org). In 2020, 359 police officers were killed in the line of duty, of which, 332 were men and 27 were women.

Now, compare those stats with the number of people who died as a result of a car accident in 2020 which is 1.36. Certainly, many of those accident victims may have been police officers, but you’ll likely understand one risk compare to the other.

Whether a police officer dies on duty protecting the public or as a result of a disease or in an unrelated job accident, they must have life insurance so that loved ones will not be financially devasted after a loss.

The risky issues that police officers must deal with while on the job are more than the average employed individual must deal with:

Responding to Traffic Accidents
Officers who work in the traffic division spend the majority of their time on highways and county roads or those of the city they are charged to patrol. This certainly puts them at risk when assisting at a roadside collision or dealing with an offender who attempts to escape in a vehicle.

On the job Careless Shootings
Since a police officer has been trained and then authorized to carry a weapon, being on duty or sometimes off duty exposes them to the risk of being shot at by a perpetrator or even friendly fire because of a crossfire situation.

Acting as First Responders
It is certainly not unusual for a police officer to be placed in a position of a first responder. Whether it’s a bank robbery in progress or a collapsing bridge, police officers will assist other first responders by getting involved in an investigation or canvassing a community to gather facts and evidence.

In either situation, the risk is part of the job and loved ones must be financially protected.

Are Police Officers Considered High Risk?
Being employed as a police officer entails that the officer works in many different situations throughout their employment.

An officer may be working vice for several years and then be assigned as a school resource officer. When an officer is onboarded after graduating from the academy, just like a service member, they will likely be assigned to various departments or divisions during their employment.

But when we considered the statistics mentioned previously and consider the overall risk of being a police officer, insurance companies understand that, although police officers do take risks on the job, overall, the occupation isn’t considered high-risk by most insurance companies.

Are the Life Insurance Policies Provided through Work Enough for Police Officers?
In a nutshell, no. Unless an officer is single and there are no children. Although employer-sponsored life insurance is a great benefit to take advantage of, it will fall short of your surviving loved ones’ financial needs if that is the only life insurance an officer has.

There are three primary drawbacks to employer-sponsored life insurance:

• The death benefit is typically limited to a multiple of an officer’s annual salary and in many cases, the limit is not sufficient to replace the deceased officer’s salary for more than a few years.
• Most life insurance policies offered by the department or union pay a lower benefit if the officer dies while off duty.
• In general, an employer-sponsored life insurance policy is not portable. This means that when the officer retires (most can after serving 20 years), the coverage will not follow the officer.

How much Life Insurance Do Police Officers Need?
If an officer has a family, and most do, the purpose of his or her life insurance policy will be to replace the officer’s income so surviving family members can financially continue after the officer’s death.
Replacing your income is more than just buying a multiple of your annual salary. When you are determining the death benefit needed to replace an officer’s income (especially if he or she is the sole breadwinner in the household) the following financial obligations should be considered:

• The surviving family’s annual living expenses
• The mortgage balance, if any, on the family residence
• Any personal debt
• The estimated cost of college tuition for any children in the household
• Estimated contributions needed for a spouse’s retirement fund
• The estimated cost of the funeral and burial service 

We have found over the years that in almost every case, the calculated replacement income is much higher than a multiple of 3 or 4 times the annual salary of an officer.

What Types of Life Insurance Policies are Available for Police Officers?
Police officers will have the same access to life insurance products as any other individual. 

Although there are quite a few types of life insurance policies available, many of them are hybrids of the basic types of insurance policies available.

 

Term Life Insurance
 

Term life insurance continues to be the most affordable type of life insurance for income replacement.

Most companies will offer term policies with policy terms of five to thirty years. And, in the last few years, several companies began offering policies with terms of up to 35 and 40 years.

Since a term policy doesn’t provide permanent coverage and there is no cash component attached, term life insurance will always be the most affordable choice.

 

Permanent Life Insurance
 

Permanent life insurance guarantees a death benefit for the life of the insured as long as premiums are paid. A permanent policy (sometimes called cash-value life insurance) also has a cash component that will build value over time and earns tax-deferred interest based on the investment performance of the insurer issuing the policy.

The two most popular permanent life insurance policies are whole life and universal life.

• Whole life insurance provides permanent insurance coverage for the insured’s lifetime and cannot be canceled by the insurer as long as premiums are paid. Additionally, once the policy is issued the premium can never increase and the policyholder can access the cash whenever needed and for any reason.
• Universal life insurance is similar to whole life because it can provide permanent coverage if properly funded. The difference between the two is that universal life policies are flexible, meaning the premium payments and death benefit can be changed by the policyholder. Generally, universal life is cheaper than whole life and typically earns more interest on the cash value account.

No Exam Life Insurance
 

No exam life insurance is typically term life insurance but is also available as whole life insurance. 

No exam policies are generally preferred by applicants who are healthy and prefer to forgo the inconvenience and privacy issues associated with a life insurance medical exam.

Moreover, since the medical exam is not required, the insurance company can typically issue a policy in a matter of days rather than weeks and months when an exam is required.

The premiums are somewhat higher with no exam policies since the insurance company is accepting a higher risk because of waiving the medical exam.

How do Insurance Companies Determine Your Premium?
A police officer’s life insurance policy is underwritten virtually the same as any other applicant. Certainly, age and health are the most dominant factors for rating but many carriers use a supplemental questionnaire once you disclose that you are in law enforcement. 

You can expect to provide some information to the insurer on the following topics:

• Do you carry a firearm? Since an armed officer may be a higher risk than an unarmed officer, your insurance company will ask about when you are and when you are not carrying a firearm.
• Do you often go out in the field? Since many officers are assigned to “desk duty” either permanently or temporarily, the insurer will ask if you ever go to the field for tasks like investigations, canvassing, and questioning possible witnesses to a crime, or crime scene investigation tasks.
• What safety measures do you take? These questions are directedly related to following established protocols and whether or not you take additional safety measures while on the job.
• Do you handle major crime cases? Certainly, major crime cases can be more dangerous than misdemeanor cases so the company will likely ask if you work major crimes and what is your average monthly or annual caseload.
• What is your specialty? If you have gone through special training over and above normal academy training, the insurer will ask in what field you have special training.​
  

That number, one million, seems awfully large when you first consider it, especially when it comes to life insurance.

But for most individuals shopping for life insurance, the purpose for the insurance coverage should be used to determine how big or small that number should actually be.

If you’re shopping for a policy to pay off the mortgage if you die unexpectedly, a million-dollar policy could likely be too much. Or, if you want to guarantee the funds are available to send three children through an Ivy League college, a million dollars could easily fall short.

Moreover, if your intention is to leave enough money to cover living expenses for your family for a handful of years, a million-dollar policy could be sufficient.

However, if your need for life insurance is to cover all of the above, a million-dollar life insurance policy will probably not get you there. Keep reading to find out what a million-dollar life insurance benefit can or cannot do for your family when you’re gone.

 
What is a Million Dollar Life Insurance Policy?
 
Simply put, a million-dollar life insurance policy is a promise from an insurance company to pay a $1,000,000 death benefit in exchange for a premium.

This million-dollar promise and your obligation to pay the required premium are always spelled out in the terms and conditions of your life insurance contract with the company.

The contract between the applicant and the insurer will become effective when the application is approved (accepted) by the insurance company and the policy is issued.

Of course, the policy will only be issued after the insurance company receives your initial payment required by the company. And, your policy will remain in force as long as you continue to make the agreed-upon periodic payments. If you don’t, your policy will lapse.

If you die during the policy period (term of the policy), the insurance company will pay the death benefit to the beneficiary or beneficiaries who are listed in your policy. If you fail to list at least one beneficiary (person or entity) in your policy, the death benefit will be paid to your estate.

 
Who Should Get a Million-Dollar Life Insurance Policy?
 
Certainly, not everyone needs a million-dollar insurance policy. And in many cases, the insurance company will look for evidence that will demonstrate why an applicant is applying for a death benefit that size.

But if you think about it, in today’s economy it’s not difficult for a family to need a large life insurance policy on the breadwinners in the household when you consider the cost of a home, two or three vehicles, credit card debt, savings for college expenses, and savings for retirement. Not to mention the cost of a funeral and burial service.

So, once again, if your intention is to replace your income that your family depends on, you’ll likely need $1million in coverage to handle it.

 
What is Covered in a Million Dollar Life Insurance Policy?
 
Unless you’ve opted for some optional riders that provide living benefits, your million-dollar policy will only pay off if you die during the policy term.

Soon after your death, the insurance company will pay the death benefit to the beneficiaries you’ve listed in your policy in the percentage or amount you’ve listed.

However, be forewarned that your beneficiaries can spend that tax-free death benefit in any way they please and that money is outside of any will you may have left behind.

If your life insurance is intended to replace your income after you die, the common things that beneficiaries will spend it on are:

• Your funeral and burial
• Outstanding mortgage on the home
• Unpaid medical expenses
• Outstanding debts
• Monthly living expenses
• Childcare expenses
• College savings fund
• Retirement fund

Remember, if you opted for one or more insurance riders that provide living benefits like a terminal, chronic, or critical illness rider, and you had to trigger that rider, the amount you received as an advance on your death benefit will be deducted from the death benefit.

 
How Much Does a Million-Dollar Policy Cost?
 
There are many things that are factored in to consider the cost of a million-dollar life insurance policy:

• Type of Policy – Term, Whole Life, or Universal Life
• Policy term – 10, 15, 20, 25, or 30-years or lifetime coverage
• Age and health of the applicant
• Occupation and lifestyle of the applicant
• Foreign travel plans of the applicant (in some cases)
• Cost of additional riders if selected
• Term life insurance will always be the least expensive choice of the three policy types because there is no cash-value account attached to the policy.

The benefits of choosing term life insurance are:

• Lower periodic premiums (monthly, semi-annually, or annually)
• Guaranteed death benefit if premiums are paid
• Guaranteed level premium for the entire policy term
• Choice of 10, 15, 20, 25, and 30-year policy term (some insurers offer 35 and 40 years)
• Renewable as an annually renewable policy at the end of the initial term (rates go up each year at anniversary)
• However, if you prefer to have a cash account that earns tax-deferred interest attached to your policy, Universal Life would be the less expensive choice when compared to whole life.

The benefits of choosing universal life insurance are:

• The policy builds cash value over time and earns tax-deferred interest
• Easy access to cash value account via policy loans
• Lifetime life insurance if policy if properly funded
• Flexible death benefit and premium payments
• Whole life insurance is very similar to universal life except the death benefit and premiums are not flexible and the premiums are generally higher.

 
Eligibility Requirements for a Million-Dollar Life Insurance Policy
If you are considering a million-dollar policy, most insurers require information concerning your risk to the company and whether or not your earnings and expenses justify this amount of coverage. 

Not only will you have to pass the medical underwriting requirement, but the insurance company will also want to verify that you are an acceptable risk when it comes to:

Your Age – Most carriers are okay issuing an insurance policy with a death benefit that is up to 40 times the annual income for applicants under age 40. Up to 25 times the annual income for applicants between 40 and 60, and up to 10 times the annual income for applicants between age 60 and 70.
Existing Coverage – If you’ve justified your need for a million-dollar policy, the insurance company will want to know if you have other life insurance in force and whether you plan to keep that coverage. If you’re asking for a million-dollar death benefit but are already insured for $300,000 and planning to keep that policy, the insurer will likely make an offer for $700,000 in coverage.
Income – An insurance company is unlikely to offer a million-dollar policy to anyone whose income and net worth don’t justify the amount of coverage. Applicants should expect to show proof of annual income as well as his or her current net worth.
Health – Any current and past health conditions will certainly come into play when asking for a million-dollar limit of coverage. Health is always a primary underwriting issue when purchasing life insurance, and in many cases, the insurer will also inquire about the health of your parents and siblings.
Can You Get a Million Dollar Life Insurance Policy without a Medical Exam?
 
Yes, you can. Because of today’s technology and innovative underwriting processes, some insurance companies will offer life insurance with a million-dollar death benefit while a few carriers will go even higher.

Keep in mind that you’ll likely pay higher rates because the insurer has allowed you to forgo the life insurance medical exam and blood/urine analysis.

For example, we are aware of nine life insurance companies that we represent that will offer a million dollars in life insurance without a medical exam. Of those nine insurers, four of them would charge less than $50 per month for a 30-year-old male non-smoker in very good health.

More importantly, each of these companies is very well known and earned “A” or better ratings from the national rating services.