Using data from 2013 Survey of Consumer Finances (SCF), this study explored the determinants associated with the amount of life insurance purchased by households. Based on Heckman’s two-stage analysis, this study focused on the interaction effect of risk-tolerance and various financial variables, such as income, assets, and debts on the purchase of term life insurance and the corresponding amount of coverage. The results indicate that the interaction of risk-tolerance with financial variables moderates the relationship between the amount of life insurance owned and financial variables. The interaction of risk-tolerance and income was found to be negatively associated with the amount of life insurance owned. The key findings of this study reinforce the notion that consumer educators and financial service providers should consider an individual’s level of risk tolerance when formulating life insurance purchase recommendations.