Let us look at the factors that will determine the selection of the best life insurance companies.
Being the sole provider for the family can sometimes lead to stress due to the family’s financial burden if the breadwinner were to die. People in this dilemma turn to life insurance companies to provide peace to their minds by financially securing their family’s future. People take out a certain amount from their income and pay it as a premium for life insurance. The premium amount safeguards the family’s future and dreams, which requires funds.
Life insurance can serve many purposes depending on the nature, need, and preference to sign up for one. Older people would like to secure their future and life after retirement by applying for life insurance during their career development. For instance, to be stable to afford all living expenses in the future and any unnecessary costs for medical fees. Similarly, people with young kids would like to secure their kids’ future if an unfortunate incident were to happen to them.
A life insurance policy would require a policyholder to assign beneficiaries that would receive the death benefit after their death. To keep the policy active, the policyholder would need to pay a premium either every month or on an annual basis depending upon the terms and conditions of the policy. The premium amount is directly related to the death benefit and the coverage period of the life insurance policy that the policyholder signs up for.
There are mainly two types of life insurance: basic life insurance and bundled life insurance. Basic life insurance, also known as term life insurance, is the most cost-effective and straightforward life insurance an applicant can sign up for. Bundled life insurance is segregated into several branches. They include whole life insurance, universal life insurance, permanent life insurance, and other life insurances where the cash value component is used.
Life insurance is considered a remedy or backup solution if things do not go as planned for the parents, thus making their children’s lives financially proof. Some parents would buy life insurance to cover the costs until the children reach the legal age of 18 years. Other parents would buy life insurance to cover all educational and personal expenses that their children would ensure. Life insurance comes in different types and can be bought to suit the needs of the life insurance holder.
Due to inflation, market, and political variables, there are incidents where people would lose their jobs. Specific jobs become redundant, and a person working in that area might find themselves unemployed. So while they have a constant source of income, people apply for life insurance that protects them if they lose their job or incur a loss of income and other financial hurdles.
Different life insurance companies offer policies that may vary from other companies and depend upon the applicant’s need. For example, the top life insurance policies will provide robust coverage to assist the family in times of loss and emotional distress. Other life insurance companies might bring some flexibility to when the premium should be paid and change it as per the applicant’s budget.
The guide will discuss the best life insurance companies that a person can apply to get a life insurance policy. We will look at the top life insurance companies in each category and highlight the reasons for their inclusion in this guide. We will discuss the factors a person should go through to determine the best life insurance companies.
How to Choose the Best Life Insurance Company?
People have different wants and needs when they approach a life insurance company for a policy. Being a life insurance provider, companies need to possess certain qualities that would enable them to seem attractive to the prospective policyholder.
Since several life insurance companies are in the industry, it can get challenging for an applicant to pinpoint the best insurance providers. It is essential to study the market and discuss it with financial advisors and designated life insurance agents who have experience. Doing this will enable a person to get factual information about the ins and outs of the best insurance companies and make decisions based on their goals and budgets.
The following factors will help you and your family select the best life insurance providers.
Review Customer Satisfaction Scores
The ideal way to know about the insurer’s reputation is by looking at their current and past customers who have had experience with the company. Prospective insurance holders can view the National Association of Insurance Commissioners (NAIC) website to check for the complaints left by customers with the state regulators. These complaints would serve as a guide and let you know of the drawbacks of insurance companies.
Almost every company has faced some customer complaints, and they can be viewed on the abovementioned website. Your task should be to look at those frequent complaints because that would mean a particular insurance company has specific drawbacks.
Customer reviews usually consist of their satisfaction with the application process for insurance companies, communication, and customer interaction with the company’s representatives. Moreover, the customer reviews would highlight the product offering of the insurance companies along with their prices. All these items accumulate towards the satisfaction scores of the customers.
People can look at the J.D Power website and view the customer reviews for each insurance company resulting in satisfaction scores for every company mentioned in the reviews. The website evaluates the customers’ reviews and rewards each life insurance company with a score out of 1000 points that serve as the companies’ rating respectively.
Assess Financial Strength and Stability Ratings
It is crucial to look at the company’s financial position to ensure that they are financially credible to pay the death benefit and claims when the policy matures. The data regarding statements can be made available from different rating agencies that have public records of every registered insurance company. It is vital to select those insurance companies with a B or higher rating. Some top rating agencies that could be referred to are Moody’s, A.M Best, and Fitch.
Prospective customers can use the above mentioned rating agencies for their reference and check out the data about the financial strength of the insurance companies. The best life insurance companies have an industry average of 776 points out of 1000. So people should only go for companies with scores equivalent to or greater than the industry average.
There have been incidents where a company with lower financial strength and stability ratings failed to provide its customers with the death benefit when several claims were filed at once. This would mean that the company’s financial position is weak, and it cannot be trusted to pay back the premium amount plus coverage to the beneficiaries. People in need of life assurance should go after companies with a history of paying on time without unwanted and unnecessary details.
Choosing a company with a robust financial strength would mean that the person would never need to worry about the company going bankrupt. Having such people would keep your mind at ease and build trust with the insurance providers. Hence, companies with excellent financial strength would not alter their internal policy. For instance, they would not change the premiums, rates, and coverage as a response to changes in the financial conditions around the world, like inflation.
Evaluate the Best Life Insurance Products
There are mainly two types of life insurance: term life insurance and permanent life insurance. Each individual has a different requirement on the type of life insurance it would suit them, so they should do their due diligence on both types.
Term life insurance, as the name suggests, is for a specific number of years and is usually enough for all the family members. With this type of life insurance, an average person can pay the premium amount without facing any financial difficulties.
As the name suggests, permanent life insurance lasts the whole life and is usually given to the beneficiaries after the policyholder’s death. This particular life insurance has an investment component that can be activated to enjoy profits and yield benefits. People can sign up for different permanent life insurance policies according to their wants and needs.
It is crucial to know why you need the policy and then look at the different policy types and the companies offering such policies to pick the one that best fits your preference.
Ask for Price Quotes
Several companies in the market offer life insurance, each having a different coverage cost. It is essential to ask for quotes from the insurance providers and compare them with other companies quotes. In this way, a person would understand how different companies are charging and which company would be a good fit for them. Having life insurance quotes from several insurance companies would give you a diverse choice, which is a smart move.
Several companies offer similar policies but specialize in certain policies, including whole life insurance or universal life insurance. Insurance companies have different strategies to implement in issuing a life insurance policy. Some companies only target seniors who need the policy, while some target the youth for the long run. Through elimination, you can narrow down the insurance companies to those specializing in offering the policy you seek and compare their rates to find the suitable one.
Size of Financial Assets
Prospective policyholders need to cater to the insurance companies’ market share to be aware of their financial position, which will prove whether they can pay back the coverage and death benefit. People can check the S&P index to find out the data for all the registered designated insurance providers and their financial standing. The higher the market share, the greater the probability that the beneficiaries will get the death benefit on time. Having a significant market share assures the people that the company is financially proof to meet its ends when the policy matures.
Alternatively, having a smaller market share shows that the company does not influence the industry. Hence, they might not be able to pay off the coverage promptly. So people should avoid buying life insurance from such insurance providers.
Ask for Recommendations
The ideal way to choose the best life insurance company is to reach out to your extended family members, friends, and work colleagues about life insurance. It is better to get first-hand information from them as they experience the respective insurance providers and can update you about their benefits and drawbacks.
People are primarily concerned about the customer service at life insurance companies. Hence, they can ask their friends about the experience they shared with their insurance provider. Also, what do they suggest who you should go with for the life insurance policy.
Seek Professional Counsel
Prospective policyholders should consider talking to a financial advisor or a licensed life insurance agent that can provide them with factual information about the best life insurance providers in the industry. These professionals can help you get the life insurance coverage suitable for you by viewing your financial standing and the best type of life insurance. It is crucial to get a second opinion from other professionals to understand the life insurance policy ideal for you.
Sample Premiums
Each life insurance company offers the free usage of their life insurance calculator on their website to determine a prospective policyholder’s premium that they would have to pay for specific life insurance. People can get a quote within a few minutes by filling out the relevant information on the company’s calculator to evaluate the premium amount. People need to provide basic and personal information to help the company know about your financial position and the policy you are seeking.
Individuals can use different insurance providers’ life insurance calculators to acquire quotes and premiums and then compare them to find the most suitable insurance provider for themselves. This is part of the due diligence process, and companies assist people in avoiding the hassle of waiting for a quote.
The following image will give you some idea of the information you would need to provide at an insurance company’s website to evaluate insurance premiums.
Let us look at the best life insurance companies providing life insurance policies to customers.
Best Life Insurance Companies
The previous section covered an individual’s factors before deciding on a life insurance policy. Here, we will discuss the different life insurance companies that are best in the given category. Let us dive in!
Bestow Life Insurance
Bestow life insurance is considered ideal for those who would like to apply for a life insurance policy without going through a medical exam. The company is well known for providing insurance policies efficiently, effectively, and straightforwardly, thus bringing convenience to its customers. The company specializes in offering term life insurance to the people looking for this specific insurance policy. Bestow is known to provide a relatively higher death benefit to the beneficiaries than other companies that do not require a medical exam for the policy.
Pros include:
- Customers can enjoy a higher coverage on the life insurance policy, up to $1.5 million, without needing a medical exam for that policy
- Bestow offers an online platform where the prospective policyholders can apply for the application, followed by an efficient processing time for the policy
- The company offers term ranges starting from 10 years to a maximum of 30 years which is beneficial for those policyholders that want to keep the policy active for a long time
- The free look period is as long as 30 days, typically ten days for most insurers
Cons include:
- The company is known not to provide any ‘riders,’ which means that the insurance policy cannot be changed regarding coverage and other benefits; hence people cannot make any amends to their insurance
- Bestow only offers term life insurance, so those people that require some other life insurance like permanent life insurance would have to look at other insurance providers
- People applying for the insurance policy have to follow the strict requirements set by the insurance provider, such as their age should be less than 60 years old to qualify for competitive coverage
- The insurance policy is not available in certain states in the USA, which means that people residing in those states cannot apply for bestow life insurance, such as residents in New York
Ethos Life Insurance
Ethos life insurance is considered ideal for people that require flexible coverage on their insurance policies to yield more significant benefits over the long run. Ethos is known to attract a diverse set of people as prospective applicants, including those who have not successfully landed a life insurance policy. The company gives a chance to older people for insurance policies despite previous rejections from other insurance providers.
Ethos is famous for providing quotes to people efficiently without waiting for insurance agents, which smooths the application process as only interested applicants stay back. The quote delivery time is only a few minutes after the necessary information provided by the applicant is reviewed. Hence, a sample premium is generated that the person would have to pay if they choose to agree with the terms.
Pros include:
- Ethos satisfies a diverse set of applicants by offering term and permanent life insurance
- The company offers guaranteed issue policies which means that if you feel to cancel your policy within 30 days after it was issued, a full refund will be given back by the company
- Ethos operation is entirely online through its streamlined online platform from where the people can apply for quotes and complete their application process
- Several policies issued by Ethos are subject to accelerated death benefit rider, which means a person is allowed to make amendments to their policy and get funds at an earlier date
Cons include:
- Ethos is not known to disclose its private information in specific categories on public reforms or websites, so there is little information available on optional riders that a person can opt
- The permanent life insurance policies have limited options available for a prospective policyholder, which may only be limited to whole-life insurance only
Policygenius Life Insurance
Policygenius life insurance is considered the best online broker in the industry, providing life insurance policies to people. Policygenius is a leading insurance marketplace with several insurance providers offering term and permanent life insurance. Policygenius connects the prospective policyholders to appropriate insurance companies that are the best fit for each other. Policygenius assures that they will not sell the personal information of a prospective policyholder to an unknown third party.
Policygenius has partnered with numerous reputed life insurance companies, including AIG, Banner Life, Pacific Life, SBLI, Lincoln Financial, etc.
Pros include:
- Choosing Policygenius will result in a smooth comparison of quotes from the various insurance provider, which will make the application process efficient
- Policygenius pledges that the insurance agents do take any commission from securing the deal with the respective insurance company
- Policygenius attracts a diverse set of individuals as all types of policies are available under particular insurance providers
Cons include:
- The quotes that are only available online are out of the reach for some insurance providers
- Some insurance policies may take some more time to get the final price relative to other policies
Haven Life Insurance
Haven life insurance is considered the best term life insurance policy relative to other life insurance providers. The company provides a wide range of term life insurance products to prospective insurance holders with varying plans and death benefits.
Haven Life also provides additional perks, including online services for people who want to create their will for their family members. The company provides different insurance policy terms for various coverage from ten to 30 years. The coverage starts from a minimum of $100,000 to a maximum of $3 million for people wishing to apply for Haven’s life insurance policy.
Pros include:
- Haven Life offers two types of life insurance policies to people, which include Haven Term and Simplified Issue depending upon the preference
- Haven Simplified Issue life insurance is perfect for people that do not want to go through a medical exam
- The coverage amount at Haven Life is up to $3 million, which attracts prospective policyholders
- Haven Term life insurance consists of additional perks such as discounts for anyone wishing to apply for this particular policy
Cons include:
- The company has stern requirements where policyholders will have to undergo a medical exam for coverage greater than half a million dollars
- The company’s policies might not be available across several states in the USA
- Once you have signed up for a policy, you are not required to change it or make any amendments to it
Ladder Life Insurance
Ladder life insurance is considered the best insurance provider regarding flexible coverage, which most policyholders want for their insurance policy. Just like the name of the policy provider, it is known for its adjustability. With ladder life, people can make amends to their policies due to a change in their financial situation. Some people choose to decrease the coverage, while others wish to increase it depending upon how stable their finances are.
The premium amount that a policyholder has to pay is flexible and can change as the person’s coverage shifts. The minimum premium a person needs to pay is $5 per month. Hence, people that are low on funds can also purchase a policy from Ladder Life.
Pros include:
- Since the company is known to be flexible around coverage, term insurance policyholders can make amends to their insurance policy as per their will
- The coverage amounts are flexible, starting from $100,000 to a maximum of $8 million
- The free look period is as long as 30 days, typically ten days for most insurers
- People who do not wish to get a medical exam can benefit from Ladder life as they provide no medical exam criteria for up to 3 million coverage
Cons include:
- The company has strict plan requirements where people between the age of 20 to 60 years can only apply for the policies that the company offers
- The company is known not to provide any ‘optional riders,’ which means that the insurance policy cannot be changed completely; there will be some oversight at the company’s end
- Ladder life only provides term life insurance coverage limiting the policy products for the customers
State Farm Life Insurance
State Farm life insurance is considered the best insurance provider for offering top customer satisfaction and stability. The company highly values the customer’s experience, so those who look forward to purchasing policies from companies that respect customer satisfaction should apply at State Farm.
State Farm Life is known to be financially stable, and with its reputation in the industry, it can be an ideal choice for prospective policyholders.
Pros include:
- Best company in the market for customer satisfaction based on the reviews left by the policyholders
- The company pledges to receive minimal minute complaints from the existing or prior customers
- State Farm provides a diverse set of insurance policy products for people
- People that do not want to undergo a medical exam can apply for a simplified issue policy
Cons include:
- The quotes that are only available online are out of the reach of all insurance providers
- Most insurance policies that the company offers require the individuals to undergo a medical exam
- The company gives discounts to selective policyholders, so not all the customers can enjoy such a perk
New York Life Insurance
New York life insurance is considered the best whole life insurance, although the company provides both term and permanent life insurance. The term policies have an additional perk where the person can switch to a permanent policy later.
Although permanent life insurance is not cost-effective, its cash value and the death benefit are worth the wait.
Pros include:
- Apart from a term life insurance policy, the person can also opt for different branches of permanent life insurance, including universal and whole life insurance
- The company is known to provide ‘optional riders,’ which means that the insurance policy can be changed regarding the coverage amount as the policyholder perceives their financial situation
- New York life is a highly rated company because of its reputation in the industry
- Because it is a mutual insurance company, the customers can earn dividends by owning some shares in the company
Cons include:
- The company does not have an online platform, so the customers and prospective policyholders have no choice but to work with the company’s agent to get the policy they need
- Since there are no online quotes available so all the policyholders will have to apply for them individually
Nationwide Life Insurance
Nationwide life insurance is considered best for bundling discounts, meaning customers can enjoy such perks in accumulation. The customers can enjoy back-to-back and frequent discounts on their policy which is cost-effective.
The company is well known for its reputation in customer satisfaction and financial stability, which attracts people to purchase a policy from Nationwide.
Pros include:
- Several discounts are available for the customers that can enjoy a cost-effective life insurance policy
- The company is known to provide ‘optional riders,’ which means that the insurance policy can be mended in a way where discounts are included
- The company provides several insurance plans, and discounts and other perks are applicable on all the policies that the company offers
- Several third parties like A.M Best vouch for Nationwide life insurance, which means that people can trust this website and avail life insurance
Cons include:
- Nationwide offers various policies to the people and asks the customer to undergo a medical exam as a requirement for all the policies
- Although the company does allow some policies to be purchased online, most of the policies that the company offers need to be purchased through the designated company’s insurance agents
Northwestern Mutual Life Insurance
Northwestern Mutual life insurance is considered the best for policy customization, and those people that wish to make amends often would be ideal to purchase a policy for this company. With this life insurance, a policyholder can access the benefits early, given that it is a special occasion, and, in other conditions, waive off their premium in case of illness.
The optional rider feature is readily available compared to other insurers offering a similar feature. The company specializes in giving the customers the monopoly to make changes to their policy as they see fit. Many people customize their life insurance based on their current or ongoing financial condition.
Pros include:
- The company offers a variety of optional riders that the policyholder can choose from depending upon their preference
- There are several policy products that a person can choose from depending on their wants and needs, including coverage, premium, etc.
- As the name suggests, it is a mutual insurance company; the customers can earn dividends by owning some shares in the company
- The company is highly rated by third parties, which speaks about its reputation and makes it more attractive to the customers
Cons include:
- The company has a limited online platform, so the customers and prospective policyholders have no choice but to work with the company’s agent to get the policy they need
- Northwestern Mutual offers various policies to the people and asks the customer to undergo a medical exam as a requirement for all the policies
- The limited online platform means that the tools available online such as looking at quotes and other relevant information are restricted
Other Life Insurance Companies
We suggest you check out several other life insurance companies as they are the second-best in their respective categories. They include the following:
Lemonade Life Insurance
Lemonade life insurance offers restricted insurance policies to the people. The company has not updated its latest information about policies and riders on its website, making it an unattractive option for prospective policyholders.
Pros include:
- The premium amount is cost-effective, starting from $9 per month, which anyone can pay
- The online platform brings convenience to the customers as they can fill out the application online without going through the agents
- If the person cancels the application in the first 30 days of its issuance, the company will provide a full refund
Cons include:
- The company has strict plan requirements where people between the age of 18 to 60 years can only apply for the policies that the company offers
- The company offers time life insurance, but it is not available in some states in the USA like New York
- People suffering from illnesses like cancer or had a life-threatening event can only apply for this life insurance
Sproutt Life Insurance
Sproutt life insurance targets a narrow and specific type of prospective policyholders. Moreover, the company’s website is not updated with the latest information like insurance coverage, term policies, etc.
Pros include:
- The company has highly invested in information technology that studies the profile of the person and partners them with the associate policy
- Sproutt life uses the quality of life index to underwrite policies
Cons include:
- Customers cannot get in touch with the customer service representative on the phone during the weekend, which means the company lacks around the clock customer service
- The company will not grant coverage to those who are in poor health like having obesity
- If the prospective policyholder has ever filed for bankruptcy, then they will not qualify for no medical exam policies
MassMutual Life Insurance
MassMutual life insurance provides various life insurance policies to the people but the policies are prone to very few optional riders which means people can’t make amends to their policy.
Pros include:
- Prospective policyholders that are young and healthy are not required to undergo a medical exam
- The company provides multiple life whole life insurance policies that have the ‘riders’ feature
- The company offers direct term life insurance and its related operations to be carried through their online platform
- The policyholders can also earn dividends by owning shares of the company
Cons include:
- Some policies do not have a conversion option which means the policyholders cannot make any changes to their policy as per their needs
- The dividends earned only apply to those that have a whole life insurance policy
- The company has very little to no policy riders, hence the certain application features like coverage cannot be changed
Guardian Life Insurance
Guardian life insurance is considered to be a non-favorite insurance provider for most insurance agents due to their lower rating and limited rides availability in their policies.
Pros include:
- The company has an online platform from where the customers can view quotes and manage their account
- People suffering from HIV can also apply for a life insurance policy with the company
Cons include:
- If someone needs to purchase a new or cancel an existing policy, they will need an insurance agent to help them through this process
- The company does not provide any policies that have no medical exam requirement
USAA Life Insurance
USAA life insurance can only be offered and applied by military personnel and their families. The company has a strong reputation for providing policies that add to customer experience and satisfaction. Moreover, the company has also received minimal complaints about current and prior customers.
Pros include:
- Military members who are out on active duty like in war zones get life insurance coverage from the company
- The company also offers survivor support to the families or beneficiaries of the policyholder if they have lost a loved one, particularly the policyholder
- The cap on the insurance policies is relatively high due to the nature of the policy and the people who can only apply to this company
Cons include:
- All applicants have to undergo a medical exam to get approved for the policy
- Certain policies are not available in certain states in the USA like in New York so residents of that state cannot apply for life insurance with USAA
Conclusion
This guide covers the best life insurance companies that any person who is looking to purchase a policy can benefit from. But they all need to consider those important factors that make up the best insurance company. We have covered some factors that you should consider applying for yourself before approving an insurance provider and the insurance policy.
The guide covers the best life insurance companies in their category and we have also listed some alternative options. Although the alternative options should not be your immediate priority, they will give you more options to choose from. We encourage prospective policyholders to consider their choice very carefully after doing the necessary due diligence and looking at their wants and needs. Since each person will have a different preference, so their insurance policy and policy providers would also be different.
