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Insider's experts choose the best products and services to help make smart decisions with your money (here’s how). In some cases, we receive a commission from our our partners, however, our opinions are our own. Terms apply to offers listed on this page. Life insurance will cover your dependents by paying them a death benefit: a sum of money your beneficiaries receive if you die during your policy. There are two types of life insurance: permanent life and term life. This article focuses on the best term life insurance companies because term life insurance is the most affordable option for most people.
Insider gathered data from 20 different life insurance companies based on customer service, financial stability, asset size rankings, and premium prices where available. You'll find our entire methodology listed below under "How we determined the winners." You'll notice that several top companies do not have quotes available online. Although it makes it harder to shop and compare, your goal should be to have the best coverage that fits your circumstances. Talk to an agent before purchasing so you know what kind of premium to expect. Best life insurance overall: State Farm Life Insurance
JD Power Customer Satisfaction Rating
AM Best Financial Strength Rating
JD Power Customer Satisfaction Rating
AM Best Financial Strength Rating
On Policygenius's website
It indicates an expandable section or menu, or sometimes previous / next navigation options.
A check mark. It indicates a confirmation of your intended interaction. Established insurance company
A check mark. It indicates a confirmation of your intended interaction. Nationwide presence
A check mark. It indicates a confirmation of your intended interaction. Highly rated customer satisfaction
A check mark. It indicates a confirmation of your intended interaction. Highly rated claims satisfaction
A check mark. It indicates a confirmation of your intended interaction. Discounts for bundling insurance products
A dash. It often indicates an interaction to shrink a section. None — State Farm scores high marks across the board
It indicates an expandable section or menu, or sometimes previous / next navigation options.
It indicates an expandable section or menu, or sometimes previous / next navigation options. Best for customer satisfaction: Northwestern Mutual Life Insurance
JD Power Customer Satisfaction Rating
AM Best Financial Strength Rating
JD Power Customer Satisfaction Rating
AM Best Financial Strength Rating
On Policygenius's website
It indicates an expandable section or menu, or sometimes previous / next navigation options.
A check mark. It indicates a confirmation of your intended interaction. Strong financial stability rating
A check mark. It indicates a confirmation of your intended interaction. High customer satisfaction
A dash. It often indicates an interaction to shrink a section. No easy way to get a quote to compare prices
It indicates an expandable section or menu, or sometimes previous / next navigation options.
It indicates an expandable section or menu, or sometimes previous / next navigation options. Best experience with insurance agents: New York Life Insurance
JD Power Customer Satisfaction Rating
AM Best Financial Strength Rating
JD Power Customer Satisfaction Rating
AM Best Financial Strength Rating
On Policygenius's website
It indicates an expandable section or menu, or sometimes previous / next navigation options.
A check mark. It indicates a confirmation of your intended interaction.
A check mark. It indicates a confirmation of your intended interaction. 4/5 customer satisfaction rating
A check mark. It indicates a confirmation of your intended interaction. Policies available nationwide
A dash. It often indicates an interaction to shrink a section. Policies must be purchased through an agent
A dash. It often indicates an interaction to shrink a section. No online quotes available
A dash. It often indicates an interaction to shrink a section. May require a medical exam
It indicates an expandable section or menu, or sometimes previous / next navigation options.
It indicates an expandable section or menu, or sometimes previous / next navigation options. Best for no medical exam policies: Nationwide Life Insurance
JD Power Customer Satisfaction Rating
AM Best Financial Strength Rating
JD Power Customer Satisfaction Rating
AM Best Financial Strength Rating
On Policygenius's website
It indicates an expandable section or menu, or sometimes previous / next navigation options.
A check mark. It indicates a confirmation of your intended interaction. Established insurance company
A check mark. It indicates a confirmation of your intended interaction. National presence
A check mark. It indicates a confirmation of your intended interaction. Discounts for bundling insurance products
A dash. It often indicates an interaction to shrink a section. Customer satisfaction varies across products
It indicates an expandable section or menu, or sometimes previous / next navigation options.
It indicates an expandable section or menu, or sometimes previous / next navigation options. Best life insurance for affordability: Life Insurance
JD Power Customer Satisfaction Rating
AM Best Financial Strength Rating
JD Power Customer Satisfaction Rating
AM Best Financial Strength Rating
On Policygenius's website
It indicates an expandable section or menu, or sometimes previous / next navigation options.
A check mark. It indicates a confirmation of your intended interaction. Wide array of term and permanent life coverage options
A check mark. It indicates a confirmation of your intended interaction. Established life insurance carrier
A check mark. It indicates a confirmation of your intended interaction. #7 in J.D. Power's life insurance customer satisfaction survey
A check mark. It indicates a confirmation of your intended interaction. Free $50,000, 10-year coverage for low-income parents
A dash. It often indicates an interaction to shrink a section. Costly for seniors and smokers
A dash. It often indicates an interaction to shrink a section. Many policies require a medical exam
A dash. It often indicates an interaction to shrink a section. Policies must be purchased through an agent
It indicates an expandable section or menu, or sometimes previous / next navigation options.
It indicates an expandable section or menu, or sometimes previous / next navigation options. Best for unique coverage options: Guardian Life Insurance
JD Power Customer Satisfaction Rating
AM Best Financial Strength Rating
JD Power Customer Satisfaction Rating
AM Best Financial Strength Rating
On Policygenius's website
It indicates an expandable section or menu, or sometimes previous / next navigation options.
A check mark. It indicates a confirmation of your intended interaction. Offered nationwide
A check mark. It indicates a confirmation of your intended interaction. Financial stability rating of A++ from AM Best
A check mark. It indicates a confirmation of your intended interaction. No medical exam is available
A check mark. It indicates a confirmation of your intended interaction. Unique coverage options like survivorship insurance and insurance for HIV applicants
A dash. It often indicates an interaction to shrink a section. Although you can get an online quote, you will need an agent to purchase a policy
A dash. It often indicates an interaction to shrink a section. Scored below the industry average in J.D. Power's life insurance customer satisfaction survey
It indicates an expandable section or menu, or sometimes previous / next navigation options.
It indicates an expandable section or menu, or sometimes previous / next navigation options. Find a life insurance policyCompare the best life insuranceState FarmWhile probably better known for auto and home insurance, State Farm also offers life insurance coverage. It ranked first place in customer satisfaction. Policy purchase can be done on your own and online and has no medical exam options. State Farm life insurance policies
Read our State Farm insurance review. Visit State Farm's life insurance website to learn more. Northwestern Mutual LifeNorthwestern Mutual Life has been around since 1857. It ranked third place for customer satisfaction by J.D. Power with strong financial stability. The emphasis is on the right coverage for your needs and where you are in life, so policy must be purchased through an advisor and will likely require a medical exam. Northwestern Mutual life insurance policies
Read our Northwestern Mutual life insurance review. Visit Northwestern Mutual's life insurance website to learn more. New York LifeAs the second-largest life insurance company in the US, New York Life is well known with top marks for financial stability and customer satisfaction, particularly with direct agent-to-consumer interaction. That being said, those who value digital experience with their insurance company might find New York Life underwhelming. The emphasis is on the right coverage for your needs and where you are in life, so policies must be purchased through an agent and require a medical exam. New York Life insurance policies
Visit New York Life's website for more information.NationwideNationwide is most known for bundling its auto, homeowners, and insurance products. Ranked second in customer satisfaction with a good financial stability rating. Cheapest quote for our sample premium and online tool to get premium quotes. Nationwide offers no medical exam policies for coverage up to $5 million but you may have to answer a few questions about your medical history. Nationwide life insurance policies
Read our Nationwide insurance review. Visit Nationwide's life insurance website to learn more. MassMutualMassMutual has been in business since 1851. They have good customer satisfaction marks and excellent financial stability. They also give free life insurance to healthcare workers during the coronavirus pandemic. Policies must be purchased through an agent and require a medical exam. MassMutual offers the cheapest term life policy at $32 a month. Mass Mutual life insurance policies
Read our MassMutual review. Visit MassMutual's life insurance website to learn more. Guardian Life InsuranceThe Guardian Life Insurance company has longevity like Northwestern Mutual and has been around since 1860. It received top marks for financial security ratings from A.M. Best. Guardian life also has an online calculator for premium quotes, but you will need an agent to purchase a policy. Additionally, Guardian Life offers unique coverage options such as survivorship insurance and insurance for applicants living with HIV. Guardian life insurance policies
Read our Guardian Life insurance review. Visit the Guardian's life insurance website to learn more. Best life insurance companies ranked by customer satisfactionAccording to a J.D. Power survey, these are the top life insurance companies in the US considering five factors — communication, interaction, price, product offerings, and statements — based on customer rankings: Additionally, here's how these life insurance companies stack up in terms of financial stability, based on ratings from AM Best, a credit rating agency. Why trust our recommendations?Personal Finance Insider's mission is to help smart people make the best decisions with their money. We understand that "best" is often subjective, so in addition to capitalizing on the benefits of a financial product or account, we outline its limitations, too. We thoroughly compared and contrasted various products' features and fine print, so you don't have to. MethodologyInsider collected data on 20 companies from S&P Global, J.D. Power, and insurers' sites. We picked our top five based on financial stability ratings, customer satisfaction, and the company's size based on market share. When available, Insider also gathered sample premiums. We didn't include companies that no longer offer individual life insurance or didn't have a minimum of 3 out of 5 for customer satisfaction. Here are the factors we considered in our methodology: Customer satisfaction: We use J.D. Power's life insurance customer satisfaction survey to evaluate the quality of service a company provides to its customers. Using the responses of over 6,000 life insurance customers, J.D. Power gathered information on customers' satisfaction with the application process, communications and interactions with the company, product offerings, prices, and statements. Life insurance companies ranked No.1 through #10 are above the industry average in customer satisfaction. Financial stability ratings: We use AM's Best to determine a provider's financial strength. AM's Best is a credit rating agency that assesses an insurance company's ability to pay claims to its policyholders. A company that receives an A++ to B+ is stable in financial strength, while anything lower than a B means that a company is unstable or unable to meet its financial obligations. Market share: The higher a company's market share, the more popular it is among policyholders nationwide. We gathered data on market shares from the S&P Global Market Intelligence. Sample premiums: While lower life insurance premiums do not mean quality insurance, we do our best to balance a policy's cost with the value an insurer provides. A good monthly premium is on par with or below the average cost of life insurance, which is between $40 to $55 a month, according to 2019 data from S&P Global Market Intelligence. Life insurance — frequently asked questions (FAQ)
Life insurance is a policy you pay for, usually in monthly installments, and it pays out a death benefit in the event of your death to cover expenses such as medical or funeral costs. If you choose a permanent life insurance policy with a cash value, this will be paid out to your beneficiaries in addition to the death benefit.
If you have dependents — people who rely on your income, like children, a non-working spouse, or aging parents you support — you need life insurance. If you don't have dependents but do have debt or own a business, you might also want to consider it.
The best life insurance policy for you depends on your budget and financial goals. There are two main life insurance policies: permanent life and term life. Term insurance lasts for a specified period, and when your term is up, you can reapply for coverage. However, premiums will most likely increase as you age and your health deteriorates. Permanent life insurance has a death benefit for your beneficiaries and a cash value that you can use during your lifetime. It's like owning a home, where you gain equity that can be used as collateral. After you pass, your home can be left to your heirs. Term life policies There are several types of term life insurance policies; some are more popular and expensive than others based on the specialty of the coverage. You may also opt-out of a medical exam with a term life-simplified issue.
Permanent life policies There are different types of permanent life insurance policies. All permanent life policies offer death benefits and a cash value that grows in a tax-deferred account. The most significant difference between permanent life insurance policies is how the cash value component is invested.
Traditionally, the rule of thumb is to get life insurance worth 10 times your annual income — so if you make $75,000 a year, you'd get $750,000 worth of coverage. However, some experts consider that to be a low estimate, especially if you'd want your life insurance payout to cover your child's college tuition or if you have a mortgage on your home you'd want to pay off. Others choose to get millions in coverage. Generally, you'll want to get as much life insurance as you can comfortably afford each month. If it would be a struggle to make your premium payments, it's probably too much for you.
There are a few ways to approach getting life insurance once you've decided how much coverage and what type of policy you need. You can find policies through insurance companies directly or through online agencies, which major insurance companies back. Online agencies let you bypass the need for an in-person insurance agent and often offer the ability to get a quote and buy your policy entirely online. If you want to go the more traditional route, you can work with an agent. Like Northwestern Mutual, you'll need to work with an agent to get a policy with some of the companies above. Companies will generally either help connect you with an agent or provide a list of agents in your area. If you're working with a company that doesn't require an agent, you can go ahead with the application process yourself. After completing some questions about your health history, hobbies, and travel plans, you may need to complete a medical exam. However, some companies are changing their medical exam policies due to COVID-19. Talk with your prospective insurer to arrange an exam you're comfortable with. After completing these steps and being approved by the insurer, you'll get your final monthly payment. From there, you'll start paying for your policy and have your coverage in place. It's important to talk to a financial advisor about your financial situation and goals to determine what life insurance is best for you.
Like any other type of insurance, term life policies have many factors influencing the price you'll pay for coverage. Your age, health, location, and amount of coverage necessary will all change the monthly premium. The company you choose will look at all of these factors differently. This will result in different prices for every company and policy. To get the best possible deal on life insurance, you'll want to shop around and compare quotes. Some carriers on this list don't offer online quotes, so it may be challenging to get an estimate. But when available, comparing four or five quotes is an effective way to save a few dollars each month on your premium. Since you'll pay life insurance for 20 or 30 years, that savings will add up.
The difference between term life insurance and permanent life insurance is similar to the difference between renting an apartment (term life) and owning a home (permanent life). When you rent, you have a lease for a certain term. When that lease is over, you can renew — but most likely with a rent increase. Likewise, term insurance lasts for a specified period, and when it's up you can reapply for coverage, but the premiums most likely will go up as you age and your health deteriorates. Term life insurance is best suited for those who want to protect their family since it's more affordable. Permanent life insurance never expires, has a death benefit for your beneficiaries, and a cash value that you can use during your lifetime. It's like owning a home, where you gain equity that can be used as collateral — and your home can be left to your heirs leaving a legacy. This is why permanent life insurance is considerably more expensive than term life insurance.
Most people only need term life insurance or coverage for 10 to 30 years. Term life insurance is usually the right choice for families with young children, people with mortgages, or anyone with debt. While the policy will expire eventually, it will expire when you pay your debts and children are grown and on their own. It covers you when you have the most at stake. Generally, they cost between $20 and $40 per month, depending on your health and the age when you start. Permanent life insurance, however, works differently. It never expires and has a cash value component in addition to the death benefit. You can use the cash value during your lifetime and use it to build wealth or leave a legacy. There are different types of permanent life insurance: whole life, universal life, and variable life. Permanent life insurance is significantly more expensive every month, but it is guaranteed to payout when you die, no matter your age. Permanent life insurance also offers cash value that accumulates interest over time. Financial advisors suggest a combination of permanent and term life insurance. For example, if you have $200,000 in permanent life and $300,000 in term for 20 years, at the end of 20 years, the term life insurance policy goes away, but you still have your $200,000 permanent policy that has earned cash value. Whether you choose permanent or term life insurance, you will need to undergo the underwriting process. The underwriting process is how the insurance company determines your insurability — determining how much of a risk you are and how much to lend you. It may require a medical exam, which includes the collection of a blood and urine sample. If you are on a fixed income with limited means, final expense, known as burial insurance, could be best for you. If you have health issues that may prevent you from traditional coverage, you may want to consider no medical examination life insurance. It's wise to consult an accountant, estate planner, and financial advisor to help you understand a life insurance's tax benefits and implications, as well as determine which insurance type is best for you. It's worth taking the time to find the best policy because once you've signed, it's tough to adjust your coverage.
Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by any card issuer. Read our editorial standards. Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available. **Enrollment required. |
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