The Best Life Insurance
The best insurance providers know that life insurance is personal: They offer customizable coverage, a range of policy options, and financial security for your peace of mind. Whether you choose coverage that lasts for five years or 85, it’s also important to find a company that offers you the best quote — prices depend on your individual circumstances. To get you started, we spoke with seven financial experts and evaluated over 70 national companies to find the four with top notch life insurance offerings.
Best Term Life Insurance
A.M. Best Financial Strength Rating A++
J.D. Power Satisfaction Rating 853/1000
Number of Available Add-On Riders 11
Best Whole Life Insurance
A.M. Best Financial Strength Rating A++
J.D. Power Satisfaction Rating 802/1000
Number of Available Add-On Riders 15
New York Life
Best Life Insurance for Seniors
A.M. Best Financial Strength Rating A++
J.D. Power Satisfaction Rating 782/1000
Number of Available Add-On Riders 11
Best Cheap Life Insurance
A.M. Best Financial Strength Rating A++
J.D. Power Satisfaction Rating N/A/1000
Number of Available Add-On Riders 8
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The Best Life Insurance
- State Farm
Best Term Life Insurance
- Northwestern Mutual
Best Whole Life Insurance
- New York Life
Best Life Insurance for Seniors
- TIAA Life
Best Cheap Life Insurance
If you only need coverage for a limited period of time, we suggest State Farm’s term life insurance. Its policies are flexible, with a wide range of term lengths, plenty of add-ons, and options for extending your coverage beyond the original term. This means you can customize your coverage and keep it as long as you need to. State Farm was also crowned best in customer satisfaction for four years running — a great recommendation in and of itself.
If you’re looking for a lifelong insurance policy, you can’t go wrong with either Northwestern Mutual or New York Life. Northwestern Mutual stands out for offering excellent Whole Life coverage. It’s exceedingly financially sound and has a good track record for dividends, which can help offset higher premium costs or grow your policy’s overall value. For seniors, we prefer New York Life’s Guaranteed Universal Life policies, which can be purchased up until age 85 and start at just $25,000 — the smallest policy we could find. You can purchase New York Life GUL at just about any point at a price that won’t break the bank.
In the market for a budget option? TIAA Life provides term life insurance policies at premiums that are hard to beat. While most term life policies are quite affordable compared to other forms, we found that TIAA could save some policyholders up to $100 per year. It also offers robust coverage and the most lenient term-to-permanent conversion options we saw anywhere — although it has a smaller selection of policy riders than our favorite term life provider, State Farm, making it less customizable.
Keep in mind that no matter what price range you’re aiming for, it’s a good idea to compare quotes from multiple providers before committing to a policy. Your price will look a little different with each company, depending on how “risky” they deem it is to insure you. While we can’t guarantee which will be cheapest, our top picks all offer comprehensive coverage — they’re a great place to start looking.
Which Type of Life Insurance is Right for You?
There are a few different types of life insurance, which generally fall under two umbrellas: Term and Permanent.
- Term life insurance provides coverage for a set timeframe — anywhere between five and 35 years. If you outlive it, the policy expires with no cash value.
- Permanent life insurance never expires, so long as you keep paying the premiums. This option guarantees a payout to your family and includes a “cash value” component that works like a savings account. The tradeoff? It’s much more expensive — up to 10 times.
The merits of term versus permanent insurance are hotly debated. Seriously: Some sing the praises of permanent insurance, while one expert we spoke with claimed the best way to approach it is “with a ten foot pole that is held by a qualified estate planner.”
The overwhelming consensus, though, is that term life insurance is best for most people. Its premiums are vastly more affordable — think $20-30 per month, rather than $300 — and it allows you to select the amount of coverage that’s appropriate for your needs. If you have kids, for example, you may want to be insured for the 20 years that they’ll be dependent on your salary. Once your dependents are self-sufficient, life insurance becomes much less imperative. Term policies are also really customizable. They come in a variety of lengths, with options to renew, convert to permanent, and add riders. We discuss the ins and outs in our review of the Best Term Life Insurance.
Some people do choose permanent life insurance over term for its cash value component. Permanent life premiums are much higher because a chunk of what you pay gets invested. Whole life is the most popular choice for permanent life insurance, as it has the largest cash component. This cash value functions like a savings account; it grows over time with interest and earns dividends, and you can even take loans from it tax-free. If savings are your main concern, though, most experts agree that you’re better off buying a cheaper term life policy and investing the difference through traditional channels like a mutual fund or 401(k). That said, if you’ve maxed out traditional retirement funds, permanent life insurance can be another avenue for passing money down to your family tax-free. If you're interested in learning more, you can read about our favorite whole life insurance providers here.
"[Generally] by investing money in other places such as the stock market, people will end up with a much higher return on their investment than they will with a whole life policy."
Guaranteed Universal Life (GUL) is the other popular type of permanent insurance. Although it’s classified as permanent, GUL functions like a term-permanent hybrid. Your coverage technically expires at a specified age (between 90 and 120 years) but it’s expected that the set age exceeds your life expectancy. That means your beneficiaries are guaranteed a death benefit payout. GUL is a good choice for seniors who have smaller death benefit requirements — funerary costs alone, for example — or who are on a budget. To learn more about GUL, check out our review of the Best Life Insurance for Seniors.
The Best Life Insurance for You Depends on Your Specific Needs
Whichever type you choose, it's important to find a life insurance provider that meets your needs and has a sterling industry reputation. We set out to find the best ones.
How We Found the Best Life Insurance Providers
In our quest to find the best life insurance, we looked at a total of 71 national companies. First, these providers had to pass a set of initial standards that guarantee availability and financial security. Then we did a deep dive into policy options, coverage limits, and add-ons to find the life insurance providers with the best, most robust policy offerings.
We focused on companies that make life insurance easily accessible.
There are plenty of regional and state-level insurance providers with solid coverage, and it’s worth looking in your area to see what the local options are. But our goal was to find the best life insurance providers for anyone — and that means being available to pretty much everyone. For this review, we only looked at companies that are available in 40 or more states.
For the same reason, we nixed companies with special membership requirements. USAA, for instance, earns consistently high praise for its insurance, but it’s only available to current and former members of the US Armed Forces and their families. All of our life insurance top picks are available to the average Joe (military members included, of course).
We also made sure that our top picks will actually sell you a policy. Some companies, like Federated and Protective Life, only offer group insurance — they have to be purchased through the workplace, not on an individual basis. If you’re purchasing life insurance through your employer, your options are limited to the provider they partner with. Here, we focused on insurance that you can buy as an individual policyholder.
We only considered providers with rock-solid financial backing.
This is the basis of insurance: You pay your premiums, and the insurer pays up on your policy if needed. Before choosing a provider, it’s crucial to do a background check. You want to be absolutely sure that a company has the capital to back the policies it writes.
"Always check and understand the financial strength rating of an insurer you are considering purchasing from."
We zeroed in on the companies with “superior” financial strength ratings (A or higher) from A.M. Best, an independent ratings agency that focuses on insurance. Then, because the Insurance Information Institute recommends comparing scores from two or more agencies, we required A-level ratings from either Standard & Poor’s or Moody’s. (You can see how their ratings stack up here). Providers with sub-par scores, or with fewer than two ratings, were cut from the running. All of our top picks are guaranteed to have the means to pay out on your policy if and when you need them to.
Term Life and Cheap Providers (19): Allianz Insurance, Ameriprise Financial, GEICO, Globe Life, Guardian, John Hancock, Massachusetts Mutual Life, MetLife, Minnesota Life/ Securian, Mutual of Omaha, New York Life, Northwestern Mutual, Ohio National, Primerica, Prudential, State Farm, TIAA Life, Transamerica, Western & Southern Financial Group
Whole and GUL Providers (15): Guardian, Massachusetts Mutual Life, Minnesota Life/Securian, Mutual of Omaha (United of Omaha), New York Life, Northwestern Mutual, Ohio National, Penn Mutual, Primerica, Progressive, Prudential, State Farm, TIAA Life, Transamerica, Western & Southern Financial Group
We dug into coverage options and riders to see who offers the most customizable policies.
The are three stages to building a great life insurance policy. First, as we’ve mentioned, is deciding whether you need term, whole, or guaranteed universal life insurance. Second is choosing your policy’s face value — in other words, how big of a death benefit you require. We recommend using a calculator like this one from TIAA to help figure out the logistics.
The third step is where you really have room to customize your life insurance. Policy add-ons — known as “riders” — can be used to extend your coverage and protect against life’s contingencies. By choosing the right riders, it’s possible to craft a policy that not only ensures a death benefit, but can provide living benefits as well.
On this our experts agree: The most important add-ons to look for are the ones that cover medical costs should you fall ill during your policy. The Accelerated Death Benefit, for example, allows a portion of your payout to be reallocated for medical treatment. John Espenschied, Agency Principal at Insurance Brokers Group, points out that these funds can be used for “anything, including experimental treatments.” In the same vein, Gordon Conwell of AmericanTerm.com highly recommends Chronic Illness Benefit and Long Term Care Riders. These cover some of the costs associated with a serious diagnosis and the long-term expenses that follow. Although these riders deplete the overall value of your death benefit, they can help to alleviate the financial burden that medical care could place on your family. All of our top picks offer at least one of these important options.
Some riders are specific to the type of insurance you choose. When we found the Best Term Life Insurance, we highlighted Guaranteed Renewability and Conversion options, which allow you to extend your coverage beyond the initial term if you need to. We also looked for Guaranteed Level Premiums, which protect you against unexpected price hikes. Our top pick for best term life insurance, State Farm, has one of the largest selections of riders on the market — 11 out of the 14 we considered.
For the Best Permanent Life Insurance, we looked for companies that provide great coverage and returns on your cash value. That means offering options like a Term Rider (which lets you add term insurance on top of your permanent policy for an additional death benefit) as well as things like Cash Dividends and a Paid Up Additions Rider (which up the value of your policy’s savings component). Our favorite whole life provider, Northwestern Mutual, offers all of these and then some.
These are just a few possible riders — take a look at the complete list here for every rider we considered and which of our top picks offer them. All four companies have a good range of options. Whichever you choose, you can tailor your policy to your specific insurance needs.
Our Picks for the Best Life Insurance
Best Term Life Insurance: State Farm
With top-tier customer satisfactions ratings, unwavering financial strength, and excellent term life options, State Farm is a solid bet for Term Life Insurance. And, with its liberal policy conversion options, it’s also worth looking into if you’re on the fence about getting permanent life insurance. Buying a much cheaper term policy with the ability to convert later on is a safe place to start.
If “like a good neighbor” translates to being friendly and easy to work with, then we’re fully on board with State Farm’s ad campaign. This company has held J.D. Power’s #1 customer satisfaction rating for four years running, which speaks volumes to its great service and claims handling processes. Coupled with superior financial ratings — A++ from A.M. Best, AA from Standard & Poor’s, and Aa1 from Moody’s — this means you can count on State Farm in times of need. It’s sure to make good on your policy in a timely and painless manner.
Of course, State Farm’s sterling reputation comes as a result of excellent insurance offerings. State Farm’s term life policies are some of the most robust on the market. Its terms are flexible: between five and 30 years of coverage, with guaranteed renewal through age 95. It also gives you the option to convert to a permanent policy through age 75, so if your finances, estate planning, or medical needs change unexpectedly, coverage can be extended indefinitely.
In addition, State Farm offers a wide range of policy add-ons, or “riders,” that can be used to customize your term life policy. Options like Accidental Death and Disability Income riders protect against unforeseen circumstances. Others, like the Spouse and Child Term Insurance riders, extend coverage to your whole family for an additional fee. It’s worth noting that State Farm lacks the Accelerated Death Benefit, which covers medical costs prior to death. However, it partially makes up for this with a Critical Illness rider, which affords one lump sum at the time of diagnosis. All in all, this company has one of the best policy selections of any term life provider.
Best Whole Life Insurance: Northwestern Mutual
Northwestern Mutual has been around since 1859 and is the largest direct writer of life insurance in the US. It also boasts elite financial strength ratings: A++ from A.M. Best, AA+ from S&P’s, and Aa2 from Moody’s. All of this means that Northwestern Mutual is a reliable choice — it’s around for the long haul, and it’ll remain financially stable. This is imperative for a company that will be with you for the rest of your life.
Because Northwestern Mutual is a mutual company, it’s owned in part by its policyholders. When the company profits, it puts money back in its customers’ pockets in the form of annual dividends. Northwestern Mutual’s dividend record has remained remarkably stable in recent years, an assurance that it will continue making good on its payments. That extra cash can be used to offset your premiums or, with a Paid Up Additions rider, can be applied back to your whole life policy to increase its overall value. The biggest benefit of choosing whole life over term is its savings component — so the more returns, the better.
Northwestern Mutual’s whole life insurance offers the most add-ons of any provider we looked at across the board, giving you a ton of flexibility when creating a policy. Some highlights include a Waiver of Premium rider that forgives payments if you become disabled before the age of 60, Accelerated Death Benefit and Long Term Care riders, and a Term rider that allows you to double-down on protection for a period of time. All in all: Northwestern Mutual offers truly comprehensive whole life coverage, coupled with the peace of mind you deserve when picking a lifelong provider.
Best Life Insurance for Seniors: New York Life
New York Life checks all the important boxes for guaranteed universal life insurance (GUL). Its policies can be purchased up until 85 years of age — and can extend through 120 — so you can opt in pretty late in the game. It also offers the lowest minimum we saw anywhere, starting at a $25,000 policy. If you‘re on a budget, or have fairly minimal death benefit requirements, New York Life’s smaller policies are an affordable way to get the coverage you need.
New York Life’s GUL plans are flexible, too. The company lets you decide on the size and frequency of your premium installments, giving you the freedom to choose a payment plan you’re comfortable with. It also brings a wide array of riders to the table. Most importantly, it has a generous Accelerated Death Benefit, which allows you to use up to 90% of the death benefit for living medical costs (most companies max out around 75%). This can relieve a big part of the financial burden associated with a serious diagnosis. New York GUL also offers a rider that usually only appears with whole life insurance — the ability to keep your coverage while forgiving your premiums should you become totally disabled.
As a thoughtful add-on, New York Life’s GUL policies give the option of insuring one or two people. The two-person version, known as Survivorship Life Insurance, pays out upon the second individual’s death. Survivorship insurance is cheaper than purchasing two separate GUL policies and is a particularly effective option in the case of a joint estate or inheritance.
Finally, in keeping with our high standards, New York Life has exceptional financial strength ratings: A++ from A.M. Best, AA+ from S&P’s, and Aaa from Moody’s. What’s more, New York Life upheld these ratings when we re-evaluated our top picks in December 2017. Some other companies fell in the ranks, and one — the North American Company for Health and Life Insurance — even dropped below our cutoff. Maintaining long-term financial strength is especially important for permanent life providers, who will be with you for the long haul.
Best Cheap Life Insurance: TIAA Life
TIAA consistently ranks among our best life insurance providers, both in terms of industry reputation and quality of coverage. This company enjoys near-perfect financial strength ratings — A++ from A.M. Best, AA+ from S&P’s, and Aa1 from Moody’s — which it has maintained since we first began reviewing insurance in 2016. It also a decent policy selection, with term lengths from ten to 30 years and plenty of term-to-permanent conversion options.
Term will always be the cheapest option.When we evaluated the Best Cheap Life Insurance, we only factored in quotes for term life policies, which tend to run about one-tenth of the cost of permanent life.
It’s worth mentioning that TIAA has fewer riders than State Farm. It lacks some important options like an Accidental Death, Disability Income, and Critical Illness Rider, which is why it wasn’t our top pick for the best term life insurance. However, TIAA does carry an Accelerated Death Benefit rider, which our experts generally believe to be the most important. It also has Guaranteed Level Premiums throughout your term, plus Waiver of Premium if you become disabled, both of which help to guarantee affordability in the long run.
Just remember: Life insurance premiums are highly personal. They’re based on a wide pull of information, including your health, your age, your family history, and your lifestyle. In other words, we can’t guarantee that TIAA will offer you the cheapest policy of any provider. To find the best price, you’ll have to compare quotes from multiple providers. However, when we got quotes for a range of profiles — different ages, male and female, smoker and non — this company consistently offered the lowest quotes of the group.
How to Build a Strong Life Insurance Policy
Do you even need life insurance? If there’s anyone depending on your salary for their livelihood — a spouse, children, an elderly parent — then the answer is probably “yes.”
The first step is choosing the right kind of insurance. As discussed earlier, the type you need depends on where you’re at in life. Here’s a brief recap:
- Term Life Insurance: Best for most people, especially younger folks whose assets will only grow over time — thus reducing the need of a death benefit.
- Whole Life Insurance: Best for people with complex estate planning considerations or those who have already invested heavily in other savings outlets.
- Guaranteed Universal Life Insurance: Best for seniors who would like to set up funds for post-life expenses or a channel for passing down an inheritance.
The next step is to determine the overall face value or death benefit for your policy. Again, this will look a little different for everyone. Your age, the number and age of your dependents, your salary, your family’s current expenses — all these are important considerations. If you purely need a death benefit for funeral costs and post-life expenses (taxes, estate handling, etc.) then you’re looking at around $15,000, according to the Insurance Information Institute. With multiple dependents and expenses, though, things become murkier. As one financial planner puts it:
“If you find yourself getting bogged down, step back and ask yourself this question: ‘What is the absolute minimum amount my loved ones would need if I passed away, not to have to worry about money, change their lifestyle, or get new jobs?’ Now double it.”
In other words, don’t undercut coverage. Think not only about salary, but also about all the “hidden expenses” your dependents could be missing out on, like health insurance and retirement funds. Ohman recommends using an online life insurance calculator to get a concrete estimate. These tools are specifically designed to factor in hidden costs and come up with the correct death benefit for your situation, all with a few simple questions. We particularly like the LifeWizard tool from TIAA for this purpose.
Look for the right riders to amp up your policy benefits.
Add-ons allow you to build life insurance that protects everything you need protected. We scoured the web and called up our top contenders to put together a list of all the life insurance riders we could find. Here’s what they mean, and which of our top picks offer them:
● = Covered by Northwestern Mutual
- Guaranteed Renewability: Purchase additional term life insurance without undergoing a second medical exam. ●●●●
- Term Conversion: Convert your term life policy into a permanent one without undergoing a second medical exam. ●●●●
- Guaranteed Level Premiums Rider: Premiums are guaranteed to remain the same through the duration of your term life policy. ●●●●
- Waiver of Premium Rider: Future premiums are waived if you become permanently disabled due to illness or injury and can no longer afford them. ●●●●
- Accelerated Death Benefit Rider: Use a portion of the death benefit (usually around 75%) to cover medical or assisted living costs if you become terminally ill. ●●●
- Spouse Insurance Rider: Extend your policy to cover your spouse for an additional fee. ●●●
- Child Term Rider: Extended your policy to cover a child for an additional fee. ●●
- Accidental Death/Double Indemnity Rider: An additional death benefit will be paid in the event of an accidental death, generally in an equal amount to the policy’s face value. ●●●
- Disability Income Rider: Provides a supplementary income if you become disabled and can no longer work, usually determined as a set percentage of the policy’s face value. ●●●
- Critical Illness Rider: The insurer pays you a lump sum of money in the event that you’re diagnosed with any of a pre-set list of illnesses (generally cancer, heart disease, stroke, etc.). ●●●
- Return of Premium Rider: Some or all of your premium will be returned if you outlive your term life policy. ●●●
- Family Income Benefit Rider: The death benefit will be paid to your dependents as a regular income (in monthly installments) rather than as one lump sum. ●●
- Long Term Care Rider: The insurer will provide a monthly stipend to cover assisted care or nursing home costs if you require long term care. ●●
- Cost of Living Rider: Your death benefit will grow to accommodate for cost of living increases in accordance with the Consumer Price Index. This generally also means an increase in premiums. ●●
- Term Rider: Add additional term life insurance on top of your permanent life policy, ensuring a larger death benefit if you die within that term. ●
- Paid Up Additions Rider (PUA or PUAR): Apply dividends to increase the cash value of your permanent life policy. ●
Get multiple quotes to find a company that compliments you.
Finding the right policy at an affordable price point is tricky — life insurance is incredibly personal, so it’s impossible to evaluate which company is the “cheapest” overall. Carriers price their policies according to all sorts of risk factors, which differ from company to company. They all take into account things like age, physical build, medical history, heredity, driving record, and “risky” hobbies. In order to stay competitive, every life insurance company has a certain type of risk it’ll tolerate more of. “Life insurance companies vary widely in their underwriting criteria and how they assess certain risks. Something that is a preferred risk for one company might be regarded as standard by another,” explains Insurance Literacy Advocate Tony Steuer.
This means that if you’re considered “high risk” for certain factors — being a smoker, for example, or have a family history of heart disease — you should be looking for a company that offers a little extra forgiveness in that category. The catch? Risk formulas are private, and underwriting happens behind closed doors. You generally won’t see a company advertising “Cheap rates for tobacco users!” (although that would make shopping quite a bit easier).
Since you can’t know ahead of time how “risky” any given company will consider you, it’s important to get quotes from multiple providers. Our top picks all offer a wide range of coverage and riders; they’ll help you build a policy with excellent protection for you and your family. Your job is to request quotes from all of them and see where you can find the best price. Many providers will also cut you a deal for paying your premium as one annual sum, rather than in monthly installments, so be sure to ask.
Save money by controlling risk factors and preparing for your medical exam.
That said, there are some steps you can take to ensure that you get the most affordable life insurance premium. The trick is knowing which factors you can control and which you can’t. Things like age and family history are out of your hands — how much they affect your premium will depend strictly on the underwriting process. Taking certain proactive measures though, like preparing for your medical exam, can save you a decent chunk of money.
"Age is simply the one factor we can’t change and the reason a healthy 50 year old will pay twice as much for the same policy as a 30 year old. This is followed by the individual’s use of tobacco, current and prior health conditions and prescription use, and family history. A smoker will generally spend twice as much as a non smoker for the exact same policy based on the same age."
Most insurance companies require you to take an initial medical exam to inform the underwriting process. Based on your results, they estimate how long you’re likely to live, and what health problems you’re at risk for (morbid, yes, but that’s how they balance their profits versus potential losses). In almost every case, taking the medical exam means saving money in the long run; no-exam life insurance carries much higher premiums because companies have to make up for not being able to assess potential losses. We discuss tips for preparing for your medical exam in more detail below.
"Just because you can skip an exam, doesn't mean you should. Just because you can get a policy with no health questions, doesn't mean you should. A little extra work on the front end can save you hundreds (or thousands) over the life of the policy."
No matter when you undergo an exam, preparation will help ensure you’re well-representing your health.
- Detox — For the week leading up to your exam, swap out salt for leafy greens and guzzle as much water as you can hold. Reducing sodium and upping hydration can help lower both blood pressure and cholesterol levels.
- Fast — 8-12 hours before the exam. It’s a good idea to schedule it in the morning for this reason. Eating before having bloodwork done can give inaccurate results and perhaps even paint a bad picture of your glucose levels and liver function.
- Avoid anything that might skew your results — alcohol, caffeine, tobacco, strenuous exercise. All of the above can cause aberrations in your results or simply draw the truth in harsher strokes.
- That said, staving off cigarettes for a brief spell before your exam won’t do much good if you’re a longtime smoker. The exam doesn’t test for nicotine, which actually disappears from the body fairly swiftly. Instead, they look for cotinine, which shows up in blood, urine, and saliva and leaves traceable amounts for about ten times as long.
No prep can totally erase long-term bad habits — it’s akin to riding a C average throughout the semester but then taking a good look at your notes the night before the final. It won’t bring you to the top percentile, but it may scrape you a low B. And that can save you some hard cash.
Feeling overwhelmed? A life insurance broker can help.
Insurance companies sell their products either directly or through an agent or broker. Brokers are typically paid on commission, which gives them a shady reputation, but financial counselor Mark P. Cussen says it’s not so black-and-white: “An adviser’s experience and knowledge of your background can help you find the life insurance products that match your needs and budget, saving you both the headaches and uncertainty about choosing the right policy.” Regardless of which life insurance route you take, it’s important to ask lots of questions and to work with an adviser you trust. Going the broker route? The Society of Financial Service Professionals can suggest a reputable one.