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Life insurance is as complicated as the policyholders and beneficiaries who use it. That means there's no single "best" life insurance company. Instead, you can find the best option based on what you want or what you prioritize.
Business Insider's editorial team has independently reviewed over 30 life insurance companies to find the best, based on insurance premiums, policy terms, overall benefits, and customer satisfaction.
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While there is no such thing as the objective best life insurance policy, you will be able to find the best insurance policy for your specific needs. Here are our picks for the best life insurance companies, whether you want to use your life insurance policy to build wealth through cash value or you're just looking for a term life insurance policy.
Here are Business Insider's picks for the top life insurance companies.
Northwestern Mutual Life Insurance offers a range of products, including term life, whole life, and universal life. It has a 790/1,000 J.D. Power customer satisfaction rating and an A++ AM Best financial strength rating.
Northwestern Mutual's whole life insurance is available for people up to 85 years old. It's available for purchase with several riders, including accelerated care benefits, waiver of premiums, and additional purchase benefits. The whole life insurance policy particularly stands out for the dividends it pays out to whole life insurance policy holders on an annual basis. The company is expected to pay $7.3 billion in 2024.
Guardian life insurance has a 743/1,000 J.D. Power customer satisfaction rating and an A++ financial strength rating. It offers term, whole, and universal life insurance. Guardian stands out for its no-exam life insurance, offering up to $3 million in coverage, which is high for the industry. You can also convert Guardian's term life insurance to a whole life insurance plan.
State Farm Life Insurance is consistently one of the leading life insurance companies in the industry, receiving the best life insurance ranking in J.D Power's Individual Life Insurance Study, with a score of 843/1,000. The company is also ranked A++ with AM Best for its financial stability with term, universal, and whole life insurance options.
All State Farm policies have to be purchased through a State Farm agent. Your agent can help you bundle and save or buy one policy. State Farm is also among the companies offering "survivorship universal life insurance," which means the policy covers two people, and it kicks in after the second person dies. Couples looking to maximize their death benefit for beneficiaries with one premium payment each month may enjoy lower overall costs.
State Farm agents can run quotes and compare options to find the right plans for each applicant. The range of options, discounts, and familiar name all contribute to the popularity of State Farm's life insurance.
Prudential Life Insurance is available in all states except New York. New York residents can buy the Pruco Life of New Jersey VUL Protector plan. This plan allows buyers to pull money out of their plan to pay for nursing home expenses. Cash value policy premiums are fixed, so you won't have to worry about extra costs later on. Internal costs are low, which minimizes risk. Due to age, many older adults want a safe investment option for their money. Prudential VUL Protector invests to avoid loss. That also means you're not as likely to see big increases in your available funds outside of what you deposit.
Brighthouse Financial Life Insurance offers term and indexed universal life insurance options. Its hybrid permanent life insurance policy SmartCare offers, is an indexed universal life insurance that offers long-term care benefits through a collection of riders, including an LTC accelerated death benefit rider.
Brighthouse's other policies are also worth a look. It offers a one-year term life insurance policy that can be converted into a whole life policy. It also offers traditional term life insurance with 10, 20, and 30-year terms and up to $3 million in coverage.
Another benefit of Brighthouse Life Insurance is that most of its policies do not require a medical exam, as long as you get regular checkups. However, for patients over 60 who have not seen a doctor within two years, you may have to take a short physical exam.
Allianz Life Insurance plans are geared towards high-income adults looking for more tax-free income. Allianz offers a 40% multiplier bonus with a 1% annual assets charge. In short, the professionals managing your investments take 10%.
Overall, your investments would pull in an extra 14%-1% asset charge. This means you end up with 3% more than what you deposit every year your life policy is active. This plan offers strong returns when using a life policy to supplement your retirement savings. Allianz also offers specialized plans to grow your income by as much as 20% according to some estimates.
Of note: Allianz also offers plans for foreign nationals, including those with H-1B visas.
New York Life Insurance agents go through extensive training before they ever hit the sales floor. What does this get you? Policies vary widely, and New York Life offers both large and small payouts. Some policies have significant penalties for early withdrawal, but taking a loan offers more options.
Whatever your questions, New York Life agents are trained to offer comprehensive support giving you accurate information about its policies every time. The company comes in at position eight in J.D. Power's latest life insurance customer satisfaction study, with a 794/1,000.
North American Company offers term policies alongside accelerated death benefits for critical, chronic, and terminal illnesses and more. The company allows one conversion on a 20-year policy at 15 years or 70 years old (whichever is earlier). The conversion cannot happen later than the five-year marker regardless of which policy you choose or the length. North American Company also offers a term policy with a lower premium renewable up to the age of 95 for qualifying insureds.
While there's many different types of life insurance policies, broadly speaking, there are two types of life insurance: temporary and permanent. Let's go over each in detail.
Temporary life insurance is often called term life insurance. This type of policy covers you for a set amount of time before expiring, usually between 10-30 years. If you pass away after your policy expires, your family won't receive any benefits. Additionally, your policy won't accrue cash value like a permanent policy. That said, some term life insurance policies offer a conversion from term to whole life insurance, so you can extend your coverage.
Because its benefits aren't guaranteed, term life policies are generally cheaper than permanent life insurance. That said, the vast majority of term life insurance policies never pay out. on
Permanent life insurance is an umbrella term for a variety of life insurance policies that will insure you indefinitely and guarantee a payout as long as you maintain your policy. Policy types that fall under permanent life insurance includes:
These policies vary widely in purpose and intended buyers, but all guarantee death benefits to your loved ones. Some permanent life insurance policies, like whole, universal, and variable have a cash value component, which you can use as a savings tool or to leave your heirs a larger death benefit.
Unlike homeowners or auto insurance, which is required by most states, life insurance is a voluntary purchase. As a result, it's not as easy to purchase life insurance online. As a result, finding the best life insurance for your needs starts with finding a trusted insurance agent. Agents can help buyers figure out what they need and when they need it.
However, there's a few things you can consider before approaching an agent:
Age
Some companies will sell you a policy for your child as soon as they're born. While this may seem morbid, early sign-up means lower rates for a policy your child could enjoy in the future. Regardless, early sign-up equates to more policy for lower premiums and a higher likelihood of acceptance. At 20, you may be healthier and be able to pay into the policy for a longer period compared to when you're 50 with more age-related conditions.
Price
As a general rule, never agree to more than you can afford. For the average life insurance agent, their job is to sell you a large policy with a large commission. Consider not only how much you make now, but how likely your current income is to continue. If you work on a project basis and your project is scheduled to end in 12 months, you may want to reconsider a policy premium outside your monthly savings.
Limits
How much are you prepared to buy? Some people only want a small policy to cover funerals and other end-of-life expenses. Others build a life policy into their retirement plan. Whatever direction you're going, involving a financial planner could help you make the right decisions. Depending on the carrier, customers can also compare set limits with index universal life policies, which set no limit. These policies never expire, and the value builds over the entirety of your life.
Living Benefits
Life happens unexpectedly. You could be healthy one day and in the hospital the next. Many life policies offer living benefits. These allow you to draw a limited amount out of your policy to cover medical and other bills you cannot pay while sick.
Penalties
Much like a 401(k), many life insurance policies have penalties for early withdrawal. No matter what policy you want, this question is critical to an informed decision. It's a question of how early you can withdraw and how much you'll lose from the total to have the money in 10 years instead of 30 or after death.
Exclusions
Some policies require insured parties to pay premiums for at least one year before any significant payout would be available. Suicide exclusions are common. Even with no medical exam policies, the company may still do a check for known conditions. An insurance company has to mitigate its risk.
Flexibility
Once you've been denied a life insurance policy, a mark goes on your record. No matter the reasons, other insurance companies may deny you coverage based on the first denial. So consider your whole situation and choose your policy carefully before you submit any applications. Some policies have greater flexibility if you lose your job or otherwise can't make payments. Others will lapse if you miss even one payment.
Payment Type
The best of life insurance for you will depend on how you want to pay for it. Universal policies have flexible premiums and adjustable death benefits, which may be appealing if you're worried about periods of financial hardship.
Even within whole life or term life insurance policies, customers have the option to choose guaranteed fixed or variable rates. Some have guaranteed payouts, but you'll need to ask your agent for details.
Plan
What is your intended use? Why are you shopping for a life insurance policy in the first place, and what are your goals? Many successful financial planners also have a background in life insurance. So while they may not be able to find you a specific life insurance policy, financial planners can help you set out a blueprint for your purchase.
In life insurance, it's easy to get "sold a bill of goods." Many life insurance agents pass a state test to be thrown into the deep end. Agents sell the company product, but not all know the products. In this vein, we look at the products each company offers. We also look at agent training.
A good life insurance agent may not volunteer all facts upfront. But a company's agents should answer questions about its products accurately and in a way the average consumer can digest. Agents should be able to inform you about the long-term benefits and limitations. This will help customers find the right policy for their long-term plan.
We consider affordability, policy sizes available, and performance for a comprehensive assessment. If you can, we recommend also working with a financial advisor to make a plan for your future with life insurance.
To inform our choices for the best life insurance companies, we spoke with the following experts:
Paul LaPiana, Head of Product at MassMutual
"There are different approaches to determining how much life insurance you need. One is the 'human life' approach, which estimates the current value of your future earning potential. Another is securing specific coverage to pay off debts such as a mortgage or provide for the education of children. A comprehensive protection plan should provide the right amount of coverage over the course of your working life and into retirement."
Barbara A. Pietrangelo, Chair of Life Happens
"There is no one-size-fits-all life insurance policy because everyone is different. One way to get a rough estimate is to multiply your income by 10 to 15; another is adding $100,00 to that amount, should you have a child and anticipate college education expenses.
Your best bet is to talk to a financial professional or use the Life Insurance Needs Calculator on LifeHappens.org to analyze what's right for you."
Wykeeta Peel, Corporate Vice President & Market Manager African American Market Unit at New York Life
"As you consider what policy best meets your needs, it can help to answer four key questions: First, how much death benefit do you need? Second, how long will you need that coverage? Third, what is your budget (or how much monthly premium can you afford to pay?), and finally, what is your investment risk tolerance?
To determine how much death benefit makes sense, it's helpful to think beyond using life insurance to cover funeral expenses and consider whether anyone is relying on the policy owner's income to maintain a lifestyle, pay rent or a mortgage, or fund a child's education and for how long.
There are various rules of thumb regarding the right amount of Life insurance coverage. Some tips can be found online, but they only provide an estimate and don't necessarily factor in an individual's specific needs. In my opinion, human guidance, powered by technology, is required. Basically, it comes down to how much money your loved ones would need to remain on firm financial ground if your earnings were no longer in the picture and that is different for everyone."
Paul LaPiana, Head of Product at MassMutual
"Increased accessibility through digital and other channels as well as through underwriting enhancements. Increased tailoring of products and features. And an increased emphasis on health and wellness programs."
Barbara A. Pietrangelo, Chair of Life Happens
"Having enough qualified insurance professionals to walk potential buyers through the multiple benefits of life insurance will be pivotal to the growth of the industry. Education is a key factor here, as professional agents also need to be able to explain life insurance and its benefits in an easy, digestible way, especially when there are so many misconceptions about life insurance."
Wykeeta Peel, Corporate Vice President & Market Manager African American Market Unit at New York Life
"The need for life insurance is greater than ever. In fact, a recent New York Life Wealth Watch survey found that 37% of adults have been thinking about life insurance more often these days – and half of adults report that financial products that provide protection (50%) and reliability (50%) are more important now compared to last year. This may be especially true for middle-market and Cultural Market families.
Our organizational structure of having Cultural Market agents embedded in the communities where we live and work allows us to understand the needs of diverse communities and develop solutions that resonate with them."
Paul LaPiana, Head of Product at MassMutual
"It is difficult to say with any certainty how healthy you will be years from now. That's why securing life insurance, and insuring your insurability, today, when you are the youngest you'll ever be again, and perhaps your healthiest is a wise decision."
Barbara A. Pietrangelo, Chair of Life Happens
"Do you love someone? If the answer is yes, then life insurance is certainly something you should consider. Many buy gifts and experiences to express their love, but haven't considered that life insurance is just another way to say I love you. Nothing says support like ensuring your family's financial security and peace of mind."
Wykeeta Peel, Corporate Vice President & Market Manager African American Market Unit at New York Life
"If you have someone depending on your income, you should consider purchasing life insurance. A death benefit from a life insurance policy can replace income from the loss of a breadwinner, ensure a family can stay in their home, fund educational or retirement expenses, address debt and so much more.
A life insurance policy can also help you grow your family's wealth over time. Once the risk of an unexpected loss has been managed, you can begin to think more broadly about your family's financial future. Life insurance can enable your mindset to shift from death to growth."
Paul LaPiana, Head of Product at MassMutual
"With life insurance, you are securing a future commitment that may be decades away. Research the company behind the policy to ensure it has high financial strength ratings, longevity, and an excellent track record of paying claims."
Barbara A. Pietrangelo, Chair of Life Happens
"When looking for an insurance agent or company, be sure to do your research. When comparing companies, be sure to remember that the policy features that fit you and your loved ones best is the most important factor. Don't automatically assume you should buy from the higher-rated company.
If the policy from the other company has more of what you're looking for, it might be the better choice. If you're unsure where to start, try the Life Happens Agent Locator to find an insurance professional in your area."
Wykeeta Peel, Corporate Vice President & Market Manager African American Market Unit at New York Life
What happens if my life insurance is paid up? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.
A whole life insurance policy has a schedule of payments to earn the total death benefit. Past a certain waiting period, you'll get the full payout if something happens. However, you can also pay it off entirely if you live longer or make larger payments early. In either of these situations, you are no longer required to make further payments to keep the policy active.
Which life insurance company is best? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.
There isn't one best life insurance company, because the best option for you will depend on the type of policy you're looking for. It's best to work with a qualified insurance agent to help you find the best coverage. If you're deciding between multiple similar options, it's also worth consulting J.D. Power's life insurance customer satisfaction study. The latest study ranks State Farm as the top pick for individual life insurance, outpacing Nationwide by three points.
How do I find the best life insurance policy for me? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.
Each situation is different and requires a knowledgeable life insurance agent to assess your best options. Bring all your questions and the coverage you're looking for to an insurance agent near you to explore your options.
Are medical exams required for life insurance? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.
No, medical exams aren't necessarily required for life insurance. Some life insurance policies are advertised as "no medical exam." This doesn't mean the insurer won't ask you about known conditions or look at medical records. You can find our guide on the best no exam life insurance here.
What is the most-used life insurance? Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.
The most popular type of life insurance is term life insurance. Term policies are only good for a specified term that you select when opening the policy — the fact that they don't last forever also makes these policies the most affordable. That said, a very slim minority of term life insurance ever pays out.