Reviews Report
- Nationwide is Reviews.com’s best cheap life insurance company, earning a 5/5 score.
- Term life insurance is generally cheaper than whole and universal.
- Young, healthy customers pay lower premiums than older people.
Life insurance is a good investment to financially cover your loved ones in the event of your passing, but it’s not always easy to fit it into your budget. That’s why we’ve reviewed the best cheap life insurance companies so that you can find coverage that doesn’t break the bank. In addition to premium costs, we evaluated the financial strength of the companies, their customer service ratings, and the variety of insurance options offered.
The 5 Best Cheap Life Insurance Companies of 2021
- Principal Financial: Best for Low Premiums
- Guardian Life: Best Online Tools
- Mutual of Omaha: Best for Families
- State Farm: Best Customer Service
- Nationwide: Best for Variety of Insurance Options
| Principal Financial | Guardian Life | Mutual of Omaha | State Farm | Nationwide | |
| Our review | Our review | Our review | Our review | Our review | |
| Best for | Low premiums | Online tools | Families | Customer service | Variety of insurance options |
| AM Best financial strength rating | A+ | A++ | A+ | A++ | A+ |
| S&P Global financial strength rating | A- | AA+ | A+ | AA | A+ |
| Moody’s financial strength rating | Baa1 | Aa2 | A1 | Aa1 | A1 |
| J.D. Power 2020 U.S. Life Insurance Study score | 772/1,000 | 743/1,000 | 789/1,000 | 838/1,000 | 803/1,000 |
Information accurate as of February 2021.
Best for Low Premiums
Why we chose it
Why we chose it
Pros
- Low premiums
- Up to 30 years of coverage
- Short online quote tool
Cons
- Must mail in forms
- Lower financial strength ratings
Products Offered
- Term life insurance
- Permanent life insurance
Standout Features
- Can convert term to permanent
- Offers four permanent life insurance policy types
Further Reading:
Best Online Tools
Why we chose it
Why we chose it
Pros
- Plenty of online tools
- Policyholders receive dividends
Cons
- Only term life insurance quotes available online
- Limited coverage options
Products Offered
- Whole life insurance
- Term life insurance
- Universal life insurance
Standout Features
- EstateGuard covers two people with one policy
- Coverage for people with HIV
Further Reading:
Best for Families
Why we chose it
Why we chose it
Pros
- Wide variety of insurance coverage
- No medical exam or health questions for whole life insurance
Cons
- No bundling available
- Limited coverage options
Products Offered
- Whole life insurance
- Term life insurance
- Universal life insurance
Standout Features
- Offers policies for children and grandchildren
- Accidental death rider
Further Reading:
Best Customer Service
Why we chose it
Why we chose it
Pros
- Excellent customer satisfaction ratings
- High financial stability ratings
Cons
- No online quote tools
Products Offered
- Whole life insurance
- Term life insurance
- Universal life insurance
Standout Features
- Four policies under whole life insurance
- Accidental death rider
Further Reading:
Best Variety of Life Insurance
Why we chose it
Why we chose it
Pros
- Four different types of life insurance
- Plenty of riders available
Cons
- Higher premiums
- No live agent chat option
Products Offered
- Whole life insurance
- Term life insurance
- Universal life insurance
- Variable life insurance
Standout Features
- Home, auto, life, and business bundling
- Term-to-permanent conversion
- Children’s term life insurance rider
Further Reading:
*J.D. Power’s 2020 Life Insurance Satisfaction Study. Based on a 1,000-point scale.
What Affects Life Insurance?
The cost of life insurance can vary substantially depending on many factors. First, there are several different types of life insurance. You can expect to pay more for a whole life or universal life policy than you would for a term life policy.
Your insurance rates will also depend on your personal characteristics. Young, healthy individuals will pay significantly lower rates. Locking in your rate when you’re younger can help you to save money for many years. Your premiums will also increase based on the amount of insurance coverage you have.
How Much is Life Insurance?
As we mentioned, life insurance premiums vary depending on someone’s age, health, and type of coverage. A young adult in good health could pay just $15 for term life insurance. But a 45-year old buying the same policy could pay closer to $55. The good news is you can lock in rates, meaning you can buy a policy when you’re younger and pay the same rate the entire term (often up to 30 years).
Whole and universal life insurance policies have higher rates because part of your premium goes toward the cash value component of the policy. While it’s not uncommon for a young person to pay $25 or less for term life insurance, the same person might pay hundreds of dollars for a whole life insurance policy.
Cheap Life Insurance: What You Need to Know
Understand underwriting
Insurance underwriters evaluate information about your health, lifestyle, and insurance needs to decide whether or not the insurance company should approve your application for insurance. These professionals also create the terms of your policy and determine your premium.
Take the medical exam
The state of your health can affect your premium, as the healthier you are, the less likely you are to make a claim. So many insurance companies require labs or medical exams as well as information about your medical history before approving your application or determining your premium.
Consider term life insurance
Term life insurance is the most affordable kind of life insurance, giving you the most coverage for the lowest premium. It’s often affordable because it’s only valid during a certain period of time and your premium is fixed during that period.
Shop around for your best offer
Compare premiums from various companies to get a sense of what the premiums are. Don’t forget to check the details of the coverage before making your final decision.
Further Reading:
Need help learning more about life insurance or choosing the right life insurance company for you? We’ve rounded up a few resources to help you get started:
- What is Life Insurance?
- Types of Life Insurance Policies
- Best Life Insurance Companies
- The Best Term Life Insurance Companies
- The Best Whole Life Insurance Companies
Life Insurance FAQs
Methodology
We evaluated life insurance companies based on riders, coverage, resources, financial strength and customer satisfaction to determine Reviews.com scores and create our best life insurance reviews. To compare life insurance companies with other providers across the board, we calculate each Reviews.com score based on the following:
- Number of riders: The more riders a life insurance company has, the higher it scores in our Reviews.com methodology.
- Financial Stability: Reviews.com utilized AM Best ratings to assign a score based on each life insurance company’s financial stability.
- Customer Satisfaction: With J.D. Power’s 2020 Life Insurance Satisfaction Study, we assigned a score to each company based on the rating it received.
- Coverage: Life insurance companies scored higher if customers can convert term to whole and if they offered multiple options under different types of life insurance policies.
- Resources: Reviews.com compared website functionality for life insurance companies based on ability to receive online quotes, submit online claims, and read information on different policies available.
