Why Trust Us
Investopedia product reviews are the result of rigorous, unbiased research and analysis by staff researchers and editors. We created this list of the best life insurance companies after collecting data points related to dozens of criteria from 45 companies. The criteria helped us evaluate each company’s costs, coverage options, financial stability, and other features and come up with objective assessments to help you choose the best provider for you.
Investopedia has been a trustworthy source of financial information since 1999 and has been reviewing life insurance companies since 2020.
How Does Life Insurance Work?
A life insurance policy is a contract between a policyholder and an insurer. The policyholder agrees to pay ongoing premiums and in exchange the insurer pays out a guaranteed death benefit if the policyholder dies.
With life insurance, policyholders designate who they want to receive the death benefit, known as the beneficiaries. The death benefit is typically received tax-free.
The premiums—or the cost you pay for a life insurance policy—are influenced by many factors such as the type of insurance you purchase, your gender, age, health status, and medical history. Someone who is 30 years old with no pre-existing conditions will qualify for lower premiums compared to someone who’s in their 60s, smokes, and has diabetes.
Life Insurance Benefits
There are a variety of reasons why you might take out a life insurance policy. For example, some policyholders might want to leave behind a financial legacy while others may want to provide their family with an income replacement while they’re gone.
Additionally, some life insurance policies offer living benefit riders, which can pay out while you’re still alive. For instance, some living benefit riders enable people to access all or a part of their death benefit if they’re diagnosed with a chronic or terminal illness. Some of these riders are included automatically while others cost extra, depending on the insurer and type of benefit.
Finally, some life insurance policies build cash value which you can access and spend while alive. These policies combine a savings account with life insurance protection.
Life Insurance Underwriting
You are not guaranteed to buy most types of life insurance. When someone applies for a policy, the insurer will complete a process known as underwriting to assess the risk of an applicant. They’ll then use the information to determine whether someone is eligible for a policy, the cost of premiums, and the amount of coverage.
During the underwriting process, an insurer will require that you complete an application and undergo a medical exam where blood and urine samples are taken. They may also evaluate data like your prescription history, driving records, credit history, and more.
However, there are some types of life insurance policies that don’t require applicants to undergo the full underwriting process, but these policies may offer lower coverage amounts and charge higher premiums.
Types of Life Insurance Policies
There are broadly two types of life insurance: term life and permanent life. Term life insurance offers temporary coverage (and is typically much more affordable because of this) while permanent life provides lifetime coverage so long as you keep paying the premiums.
Term Life Insurance
Term life insurance is a type of life insurance that offers policyholders coverage for a fixed period of time—typically, between 10 and 30 years. If a policyholder dies while they’re covered, their beneficiaries will receive the death benefit. But if an individual outlives their policy, allowing the policy to expire without renewing it, their beneficiaries won’t receive the death benefit.
These policies usually have fixed premiums during the term, and tend to be much more affordable than permanent life insurance policies. That’s because most term life insurance policyholders outlive their coverage, so insurance companies take on less risk when insuring these policies. You and your beneficiaries are also much less likely to receive a payout from term life insurance.
If you want more flexibility with your term life insurance policy, you may consider opting for a convertible term life insurance policy. These policies give people the option of converting their term life policies into permanent whole life policies without undergoing an additional medical exam.
Whole Life Insurance
Whole life insurance is a type of permanent life insurance that offers lifelong coverage. This means that as long as a policyholder keeps up with their premiums, their beneficiaries are guaranteed to receive a death benefit when they pass away. Whole life insurance is typically much more expensive than term life.
Like other permanent life insurance policies, whole life insurance offers a savings feature known as cash value, which policyholders can borrow from, withdraw, and use to pay premiums. With whole life insurance policies, premiums are typically level, which means they’re fixed during your lifetime while you have the policy.
Here’s how permanent life insurance works: When a policyholder pays a premium, a portion of it goes towards the ‘cost-of-insurance’, which includes administrative costs and the cost of the death benefit. Another portion of the premium is allocated towards cash value.
Typically, whole life insurance policies offer a fixed rate on cash value, so the rate doesn’t fluctuate with changes in the economy or the market. Some insurers will even pay dividends on cash value. Dividends are profits from the insurer that are returned back to policyholders, but they may not be guaranteed.
Universal Life Insurance
Universal life insurance is another type of permanent life insurance. It offers more flexibility than whole life insurance. Universal life insurance policyholders can typically adjust their death benefit and premiums.
With universal life insurance, policyholders can make lower or higher premium payments within a certain range. If a policyholder chooses to pay less than the minimum premium, their cash value will be used to cover the rest of the cost. Yet if a policyholder regularly makes only the minimum premium amount, they could be at risk of their coverage lapsing if they don’t have enough cash value built up to cover their premiums.
Additionally, universal life insurance offers a variable rate on cash value, so the return may vary with changes in market conditions. However, there is still a minimum rate on cash value.
If you decide to terminate your universal life insurance policy, your remaining cash value will be returned back to you. There may be fees, known as surrender charges, and outstanding loans subtracted from that amount. The total amount you get back, sans surrender charges, is referred to as the cash surrender value.
Note that surrender charges typically decline the longer you’ve had the policy and may not be charged after you’ve had the policy for at least 10 to 15 years.
No-Medical-Exam Life Insurance
Like the name implies, no-medical-exam life insurance applicants are not required to complete a medical exam to qualify for a policy. This type of insurance allows applicants to simplify the application process, but these policies generally charge higher premiums and may offer lower coverage amounts because insurers may not have a complete picture of health. There are three categories of no-medical exam life insurance: accelerated underwriting, simplified issue, and guaranteed issue.
Accelerated underwriting: With accelerated underwriting, insurers may still require a health questionnaire, but they also evaluate data like an individual’s prescription history, criminal records, and more. Some insurers may charge higher premiums for these policies, but some may not. Accelerated underwriting has tougher standards than other no-medical exam policies. In exchange, you can usually apply for much larger amounts of coverage, up to $1 million or more depending on the insurer.
Simplified issue: Simplified issue life insurance also typically requires a medical questionnaire. Approval for these policies is fast, but companies may limit coverage to up to $100,000 maximum. These policies may be best for those with medical conditions, as you may be denied coverage or charged higher premiums on a traditional policy.
Guaranteed issue: Lastly, with guaranteed issue life insurance, applicants don’t have to complete a medical exam or a questionnaire. You are guaranteed to qualify, even with serious health issues. For this reason, guaranteed issue life insurance policies generally offer very limited coverage, ranging from a few thousands dollars to up to $50,000.
These policies also have a graded death benefit, which means there’s a waiting period of two to three years. If a policyholder dies during the waiting period, their beneficiaries won’t receive the death benefit, but they will get back any premiums plus interest. After the waiting period is over, beneficiaries receive the full death benefit. Guaranteed issue life insurance is a type of whole life insurance policy, which means it can include cash value.
How We Chose the Best Life Insurance Companies
Investopedia’s list of the best life insurance companies is based on comprehensive research of 45 companies.
To even be considered for this list, insurance companies had to first meet Investopedia’s standards for online transparency, financial strength, and customer complaint ratings. Investopedia commissioned a consumer survey about life insurance, and consulted market share intelligence and other information about insurance company relevance and popularity to come up with a list of 45 companies to research further.
We gathered 3,150 data points related to 70 criteria between May 20 and July 3, 2024. The data came from company webpages, media representatives, rating agencies (AM Best, NAIC, and J.D. Power), and customer service calls.
Then, staff editors and research analysts created a quantitative model that scores each company based on six major categories. We weighted the categories as follows:
- Policy Features and Riders: 35%
- Policy Types: 22%
- Application and Online Service Features: 15%
- Cost: 12%
- Customer Satisfaction: 10%
- Financial Stability: 6%
For more information, read our full methodology explanation.
:max_bytes(150000):strip_icc()/Yasmin-Ghahremani-BW-WebReady-01-b39791637712414ba1b30b2633b5c6d6.jpg)
:max_bytes(150000):strip_icc()/profpic-822923ed1d8f468ab378e3ac09808a96.jpeg)
:fill(white):max_bytes(150000):strip_icc()/Nationwide-ef67197be784422aa434bc3bb3b23031.jpg)
:fill(white):max_bytes(150000):strip_icc()/Legal_General-99c81dbfffae4c7f8e5862bb5f1c1a91.jpg)
:fill(white):max_bytes(150000):strip_icc()/Protective_Logo-c4eec069bba045908b26d4fbb52beee9.jpg){kind=logo}
:fill(white):max_bytes(150000):strip_icc()/SBLILifeInsurance-183f582165f54aff803749178074fdda.jpg)
:fill(white):max_bytes(150000):strip_icc()/Pacific_Life-b0c8ff4673204466b6a2e7245975f41a.jpg)
:fill(white):max_bytes(150000):strip_icc()/Lafayette_insurance-0439947e96294c259ba160ca612e29ae.jpg)
:fill(white):max_bytes(150000):strip_icc()/MassMutual-5542d799adfc45ebb6a7ab9b116e9c7c.jpg)
:fill(white):max_bytes(150000):strip_icc()/Penn_Mutual-70902c2bb7a04b4087d9cc4970c53f87.jpg)
:fill(white):max_bytes(150000):strip_icc()/Symetra-f8f441deb57640f7937257c32278117d.jpg)
:fill(white):max_bytes(150000):strip_icc()/Thrivent-d7dade2eede44dc896722b629376fac8.jpg)
:max_bytes(150000):strip_icc()/11BestTermWholeandNo-ExamLifeInsuranceCompanies-final-1659b4ecc9c3410494a71833647d98d4.png)
:max_bytes(150000):strip_icc()/BestChildrensLifeInsuranceCompanies-v1-6f02811dfdcb4f7a8ebe56ad202a62b4.png)
:max_bytes(150000):strip_icc()/BestWholeLifeInsuranceCompanies-final-492bf534ded442de830628287dd50409.png)
:max_bytes(150000):strip_icc()/BestTermLifeInsuranceCompanies-final-b2106835adde47b1ac9cf2942968ad13.png)
:max_bytes(150000):strip_icc()/BestUniversalLifeInsuranceCompanies-final-fb6a9bd142594fbebcc9eb7b41115da5.png)
:max_bytes(150000):strip_icc()/BestLifeInsuranceWithLivingBenefits-v1-f890632de4ba4e6398ceb7516a736b3a.png)
:max_bytes(150000):strip_icc()/DentalInsurance-Roundups-BestDentalInsuranceCompanies2-b2006ba5d079402bae6fe4d217ee1f43.png)
:max_bytes(150000):strip_icc()/BestSmallBusinessInsurance_final-bb9cd30c0e6f4a27a5affd3618001931.png)
:max_bytes(150000):strip_icc()/GettyImages-1314206939-2f1f27988343496083631b595e6c4ab7.jpg)
:max_bytes(150000):strip_icc()/GettyImages-485523412-4998f86ed50f4b6ea21eef358e281358.jpg)
:max_bytes(150000):strip_icc()/MostAffordableLifeInsuranceCompanies-v11-07c82438291c425a95c812c772195eb6.png)
:max_bytes(150000):strip_icc()/TrackerMortgageWhatItIsHowItWorks-0cfa74cb475049db8882a75d204780a8.jpg){kind=tracking}
:max_bytes(150000):strip_icc()/The-best-self-directed-ira-companies-11706224_final-8dbc772d24c64336b7e6457ee3781e88.png)
:max_bytes(150000):strip_icc()/Best4-YearCDRates-5b6612b8550e43a286088bee8a41d2c2.jpg)
:max_bytes(150000):strip_icc()/Best5-YearCDRates-44dbe3c135f3435bbf42f5cc09a92a2e.jpg)
:max_bytes(150000):strip_icc()/GettyImages-924570014-b47ea0d03b93414186b96cbe96b75a1f.jpg)