- AM Best Rating: A+1
- Types of Life Insurance:Four
- Issue Ages:18-75
Prudential was chosen as the best life insurance company overall based on the company history dating back to 1873, the broad selection of policies available, and excellent ratings for financial strength.
- Get an instant quote for term life insurance online
- Excellent ratings for financial strength
- Multiple riders can be added to your policy
- No online quote for permanent life insurance coverage
Prudential Financial dates back to 1873, which bodes well for its reliability. The Prudential Insurance Company of America also boasts an A+ rating with AM Best, as well as an AA- rating with Standard & Poor’s in terms of its financial strength.2
Prudential offers term life insurance coverage, universal life insurance, indexed universal life insurance, and variable universal life insurance, and you can add riders to your policy that include an accidental death benefit, a living needs benefit, and a children’s protection rider.
Prudential does let you apply for an instant online quote for term life insurance. To learn more about life insurance from Prudential, have a look at our full review.
BEST INSTANT ISSUEState Farm
- AM Best Rating: A++3
- Types of Life Insurance:Three
- Issue Ages:18-75
We chose State Farm as the best company for instant issue policies based on the fact you can apply online and get term life coverage without a medical exam or any hoops to jump through. State Farm’s excellent ratings and long history also helped it gain a spot in our ranking.
- State Farm extends some term policies without a medical exam
- Free quotes for term life insurance coverage online
- Excellent ratings for financial strength and customer satisfaction
- No life insurance offered in Massachusetts
State Farm is another insurance company with a long and storied history. Founded in 1922 by a retired farmer, State Farm has grown from humble beginnings to offer a broad range of insurance products today. At the moment, State Farm comes in at number 39 on the Fortune 500 list of largest companies.4 This company also boasts an A++ rating for financial strength from AM Best, which is the highest rating possible.5
Also, note that State Farm secured the highest ranking in the J.D. Power 2020 U.S. Life Insurance Study, which compared the experiences of life insurance and annuity customers nationwide.6
When it comes to the life insurance products it offers, State Farm lets consumers purchase term life insurance coverage, whole life insurance, and universal life insurance. State Farm also makes it easy to enter your information and get a free quote online for term life.
State Farm extends instant answer term life insurance coverage you can apply for online, and these policies can be purchased with no medical exam. You do have to answer health questions in your application, however.
How much does life insurance with State Farm cost? Request a quote online or speak to an agent to find out.
- AM Best Rating: A7
- Types of Life Insurance:Five
- Issue Ages: 18-80
Transamerica offers very affordable term life insurance coverage and has a long history of financial strength and reliability, which helps the company stand out as the best value in life insurance in our review.
- Premiums for term life insurance represent a significant value
- Strong ratings for financial strength
- Must speak with an agent to get a quote for some products
While Transamerica may not be a household name, this company has been around since 1904 and boasts solid ratings for financial strength, including an A rating with AM Best and an A+ rating with S&P Global.7
8 Transamerica scored well below average in the J.D. Power 2020 U.S. Life Insurance Study, though, with only 734 points out of 1,000 possible.6
Transamerica also offers a broad selection of life insurance coverage including term policies, whole life insurance, universal life insurance, index universal life insurance, and final expense life insurance.
Transamerica has you speak to an agent in order to get a quote for most of its life insurance products. However, you can get quotes for term life online. Its premiums for term coverage tend to be an excellent value. To learn more about Transamerica Life Insurance check out our full review below.
BEST WHOLE LIFENorthwestern Mutual
- AM Best Rating:A++9
- Types of Life Insurance:Three
- Issue Ages: 18-80
While Northwestern Mutual is known for quality overall, its whole life insurance policies are especially popular. The company paid out a record $6.2 billion in dividends to its policyholders for the year 2020.10 Not only do its policies tend to pay generous dividends, but you get the benefit of working with a financial advisor who can help guide you to the best whole or another type of life insurance policy for your situation.
- Excellent ratings for quality and financial strength
- Term life, whole life, and universal life insurance offered
- Must work with a financial advisor to get a quote
Northwestern Mutual has been in business since 1857, and it has solid ratings that show its commitment to offering quality products and services. Not only does Northwestern Mutual boast an A++ rating from AM Best and an AA+ rating from S&P Global, but it also earned high marks for customer satisfaction in the J.D. Power 2020 U.S. Life Insurance Study.611
Northwestern Mutual offers term life insurance coverage, whole life insurance coverage, and universal life insurance coverage. However, due to the fact it employs financial advisors who oversee your full financial picture, you will need to go through a complete financial review to get a quote.
This means you’ll need to work with one of Northwestern Mutual’s financial advisors and provide more information on your finances and your life. This can be a major benefit if you need some help with comprehensive financial planning and want to make your whole life insurance a part of your overall financial picture.
BEST TERM POLICIESNew York Life
- AM Best Rating: A++12
- Types of Life Insurance:Four
- Issue Ages: 0-90
New York Life boasts excellent ratings for financial strength, as well as flexible term life insurance policies that you can convert to permanent insurance in the future—and the company makes it easy to tailor your term life coverage for your own specific needs.
- Company has excellent financial ratings
- A long history that began in 1845
- Four main types of life insurance coverage are available
- No online quotes
- Must speak with a financial advisor for coverage options
New York Life has been in business since 1845, which is a testament to its reliability in the market. This company also reports very solid ratings for financial strength, including an A++ rating from AM Best and an AA+ rating from Standard & Poor’s.13 Furthermore, New York Life sits in the sixth spot in the J.D. Power 2020 U.S. Life Insurance Study, which compared 23 companies based on customer service satisfaction and other factors.6
New York Life offers four main types of life insurance coverage—term life insurance, whole life, universal life, and variable universal life. It also offers an array of helpful life insurance resources on its website, as well as charts that can help you compare its policies and offerings.
We chose New York Life as best for term life coverage based on the fact it offers term life insurance that can convert to permanent life later on. It also offers customizable add-ons for disability or terminal illness, which you can utilize in order to build the type of coverage that best fits your needs.
Unfortunately, New York Life does not offer free quotes online. Instead, it asks you to enter your information in a form, after which a financial professional will speak with you to go over your full financial picture.
BEST FOR NO MEDICAL EXAMSMutual of Omaha
- AM Best Rating: A+14
- Types of Life Insurance:Four
- Issue Ages: 0-85
Mutual of Omaha offers term and whole life insurance policies with no medical exam for applicants who qualify. This means you may be able to fill out a health questionnaire from the comfort of your home, with no invasive health exam, and get coverage when you pay your first month’s premiums.
- Excellent ratings for financial strength
- Easy to get a quote online
- Apply for certain term and whole life products without a medical exam
- Must apply for eligibility of coverage with no medical exam
Originally founded in 1909, Mutual of Omaha has grown tremendously over the years and is now a provider of life insurance, long-term care insurance, annuities, investments, and more. In terms of financial strength, Mutual of Omaha has an A+ rating with AM Best and an A+ rating with S&P Global.15 Also, Mutual of Omaha secured the fifth spot out of 23 in the J.D. Power 2020 U.S. Life Insurance Study with 789 points out of a possible 1,000.6
Mutual of Omaha offers a selection of life insurance policies to choose from including term life insurance, whole life, universal life, children’s whole life insurance, and accidental death insurance. You have the option to speak with an agent in your area if you prefer, but Mutual of Omaha also lets you get a free quote or apply for any of its policies online. Mutual of Omaha also offers term and whole life coverage options with no medical exam, although not all applicants will qualify.
How much does its coverage cost? Request a quote or speak with an agent to find out. For more information, check out our full review of Mutual of Omaha.
Read the full Mutual of Omaha life insurance review.
BEST FOR MILITARYUSAA
- AM Best Rating:A++16
- Types of Life Insurance:Two
- Issue Ages:0-85
USAA auto and home insurance and banking products are only available for military members and veterans, but it’s life insurance products are available to the public. USAA boasts excellent ratings for financial strength, and it offers an array of riders you can add to your policy to bolster your benefits. Finally, USAA focuses primarily on military members, so it understands the lifestyle and risks and can make the underwriting process easier as a result.
- Easy to get quotes for life insurance online
- Purchase term coverage or permanent life insurance
- Excellent ratings for financial strength
- Life Insurance products are available to the public
- Premiums may be higher than some competing companies
USAA is a provider of insurance and banking products for U.S. military members and veterans. Founded in 1922, the company has grown from humble beginnings to become a provider of life insurance, auto insurance, checking and savings accounts, and many other products military members need in their lives.
Currently, USAA has just less than 13 million members and the life insurance component of the company boasts excellent ratings. These include an A++ rating from AM Best as well as an AA+ rating from Standard & Poor’s.17
When it comes to life insurance coverage, USAA offers term life insurance coverage for up to 30 years as well as permanent life insurance products that last a lifetime. It also makes it possible to get a free quote for both term and permanent coverage online, which means it is more transparent on pricing than many of its competitors.
USAA also offers some premium rider options to its customers, including a term life event rider that lets you increase coverage by up to $100,000 without a medical exam. Other available riders include a military severe injury rider, a future insurability rider, a waiver of premium rider, and the ability to add coverage for a spouse and children.
One detail to note about USAA is the fact that you have to be a member to apply for its auto and home insurance and bank products, and that membership requires some level of military service or veteran status. With that in mind, USAA life insurance products do not require membership and are available to the public.
Prices for policies vary, so if you’re eligible for USAA get a quote and see what it would charge you. To learn more, check out our full review below.
Read the full USAA life insurance review.
When looking for a life insurance company, it’s important to find a provider that has a strong and stable history, offers a full gamut of insurance options, and gives the added support and resources, including articles and calculators, to help you make an educated decision.
Prudential Financial checks all these boxes and even makes it convenient by allowing you to quote policies online for up to $250,000. Of all the companies we reviewed, Prudential can fulfill the life insurance needs of more people when compared side by side to the competition.
Compare the Best Life Insurance Companies
|Company||AM Best Rating||Coverage Capacity||Issue Ages||Policies Offered|
|A+||Not Stated||18-75||Term, variable, and universal|
Best Instant Issue
|A++||Not Stated||18-75||Term, whole, and universal|
|A||Not Stated||18-80||Term, whole, universal, and final expense|
Best Whole Life
|A++||Not Stated||0-80||Term, whole, and universal|
|New York Life
Best Term Policies
|A++||$5,000,000 and up||0-90||Term, whole, and universal|
|Mutual of Omaha
Best for No Medical Exams
|A+||$100,000 and up (term life)||0-85||Term, whole, universal, children’s, and accidental death|
Best for Military
|A++||$10,000,000||0-85||Term and permanent|
Guide to Choosing the Best Life Insurance
Selecting a life insurance policy can be a difficult decision, especially if you’ve never done it. Before you get started, it helps to understand not only the different options you have, but some basic terms and criteria so you pick the right policy for your circumstances.
What is Life Insurance?
What Are the Different Types of Life Insurance?
Life insurance comes in many different forms from short-term contracts to lifetime coverage. The best life insurance option for you depends on your financial goals, health status, age, and a variety of other factors.
Here’s a quick overview of each type of life insurance, and who it is best suited for:
- Term. Term policies offer temporary life insurance coverage for a fixed length of time. Most policies range from five to 30 years in length and typically offer a high death benefit for a lower premium. Term is best for young, healthy individuals looking for low-cost coverage.
- Whole. Whole life insurance is a type of permanent life insurance designed to cover individuals for their lifetime. Policies may accrue cash value that earns interest and can be borrowed against on a tax-free basis.
- Universal. Universal life insurance is a type of permanent life insurance, offering flexible benefit amounts and premiums. Policies may accrue cash value that can be invested for additional growth, and borrowed against on a tax-free basis.
- Indexed. Indexed life insurance is a type of universal life insurance that allows individuals to invest the cash value accrued within the policy in market indices (such as the S&P 500) for tax-deferred growth. The cash value balance can be borrowed against on a tax-free basis.
- Guaranteed issue. Guaranteed-issue life insurance policies are a type of permanent life insurance that offers guaranteed approval for a small amount of coverage, regardless of the applicant’s health status. No medical exam is required for approval of coverage.
- Final expense/burial. Final expense life insurance is a type of permanent life insurance designed to cover end-of-life expenses, such as funeral and burial costs. These policies are typically smaller amounts, and many offer coverage with no medical exam required.
- Annuities. An annuity is an insurance contract designed to provide a steady income stream in retirement. Annuities are typically funded in a single lump sum, or with multiple payments during the accumulation phase. Payouts start at the “annuitization” phase and vary depending on the details of the contract.
Life Insurance Terms You Need to Know
When researching life insurance policies, you’ll want to know a few terms to understand exactly what is included in the policy.
- Face value. The face value of an insurance policy is the amount of money your beneficiaries would receive should you pass away while the policy is in force.
- Death benefit. The death benefit is the same as the face value of the policy, which is the payout upon death to your beneficiaries. Policy death benefits may be reduced if any payouts are taken from the policy due to an accelerated benefit provision or if any withdrawals or loans are taken against the cash value of a policy.
- Cash Value. Some life insurance policies use a portion of the premium to accrue cash value within the policy. This cash value can earn a fixed amount of interest, or be tied to an investment index for more growth. The cash value is tax-deferred savings and can be borrowed against on a tax-free basis.
- Riders. A rider is a life insurance policy enhancement that offers additional benefits or custom coverage options to the insurance policy. This may include coverage for a spouse or children, additional payouts for accidental death, or the ability to access policy funds early. Rider fees are typically billed as a small percentage of the policy premium or as a flat annual fee.
Who Needs Life Insurance?
Life insurance is designed to protect your assets and pay your obligations should you pass away. A few reasons you may need life insurance include:
- You are married
- You own a house with a mortgage
- You are the sole provider for your family
- You want to cover funeral and burial expenses
- You want to build tax-deferred cash value
- You want to supplement your retirement income
- You own a business
- You have large debts
This is not an exhaustive list of reasons for life insurance, and most everyone benefits from having some type of life insurance coverage.
How Much Life Insurance Should I Get?
The amount of life insurance coverage you should carry depends on a few factors:
- Your age
- Your debt obligations
- Your income
- Years until retirement
- Your family
Many financial professionals recommend coverage of at least 10 times your annual salary as income replacement but you may need more or less, depending on your circumstances. For instance, if you have a large mortgage and are the sole breadwinner for your family, you may opt to get more than 10x coverage on yourself. Or this may be a simple final expense policy that covers end-of-life costs.
Here’s a quick example of how to determine how much life insurance coverage you may need:
John has a wife and three kids. He makes $100,000 per year as the sole breadwinner, and they carry $500,000 in debt ($450,000 mortgage and $50,000 in auto loans). John has decided to get 10x his salary in term life insurance coverage, plus another $500,000 to cover their debt obligations. Term coverage allows him to obtain coverage for a specific amount of time (say, 20 years), for the lowest monthly cost.
Life insurance coverage should allow your loved ones to grieve without worrying about the financial implications of your passing.
How to Choose the Best Life Insurance
The best type of life insurance is the one that fits you and your family. This includes understanding how much coverage you want, and what the money would be used for if you pass away. You will also want to consider whether you want temporary or lifetime coverage. You may want lifetime coverage, but then learn that term policies would save a significant amount of money, as well as cover you for the highest risk years (more debt, more familial obligations).
Finally, figure out what you can afford. Most policies change a monthly or annual premium, with additional costs for riders. If you are looking for a low monthly cost, term policies may be a better fit, but if you want to use your insurance policy to grow your wealth, a whole or universal life policy may fit the bill (though it is more expensive). Compare costs between term and permanent policies to find what fits best in your budget.
For example, a 30-year-old man with a 20-year $500,000 policy will pay an average of $27.69 a month. A 30-year-old man with a $100,000 whole life policy will pay $89 a month, payable to age 99. This is more than double the cost of term life while providing less coverage, but covering you over a longer and more risky time of your life.
To get the best life insurance policy for your situation, and one that fits your budget, follow these steps:
- Step 1: Decide what kind of policy you want: term or permanent.
- Step 2: Figure out how much coverage you need and how long you want to be covered. If you’re buying a term policy, figure out how long of a term you need. If you are looking to purchase a permanent life policy for lifetime coverage, figure out how the cash value component fits in your overall financial plan. You may want to talk to a financial planner about what makes sense for you and your family.
- Step 3: Talk to a life insurance broker and ask them to pull quotes for the type of life insurance you’re interested in. If you’re not sure whether to choose term or permanent life insurance, ask the broker to get quotes for both kinds.
- Step 4: Compare life insurance quotes from different providers and choose one that meets your requirements and fits your budget.
- Step 5: Schedule a medical exam if necessary. If not, apply for and wait to be approved for the policy.
Remember that it’s OK to get several different quotes to find the best policy. Do your research, ask questions, and/or speak with a financial or insurance professional if necessary.
What Does Life Insurance Cover?
Life insurance offers a death benefit to insured individuals that die while the policy is in force. Additional coverage may be added to the coverage of the death of a spouse or children. Riders may offer a payout if the insured is diagnosed with a terminal illness, or if they become permanently disabled and unable to work.
Life insurance covers most types of deaths and may offer additional benefits when the death is the result of an accident. Some life insurance policies may also accrue cash value on a tax-deferred basis, that can be borrowed against or withdrawn (after a certain age).
What Doesn’t Life Insurance Cover?
Life insured typically does not cover death as the result of suicide within two years of opening the policy. After the contestability period, suicide is typically covered on most policies. Life insurance also does not pay out a benefit if the insured lied on any of the medical questions asked when applying for the policy.
Some policies do not cover death as a result of high-risk activities, such as bungee jumping or skydiving. Exact coverage details will be determined by your policy, and it’s best to meet with an insurance professional to determine what activities may not be covered.
And, though it is awful to think about, if a policyholder is murdered by one of the life insurance policy beneficiaries, there is no payout to that beneficiary. Instead, the payout may be directed to a contingent beneficiary but this all depends on the circumstances surrounding the crime.
Can I Have More Than One Life Insurance Policy?
Yes, you may be covered by more than one life insurance policy. In fact, stacking multiple life insurance policies is a good way to add or remove coverage as your life circumstances change.
For example: Once you get married, you may get a $250,000 term policy to replace your income. Once you buy a house and have children, you may opt to pull out another $500,000 policy to cover the loss of income and help pay for the mortgage and additional expenses of raising children.
Can I Get Life Insurance If I’m a Smoker?
Yes, you can. Most life insurance companies offer life insurance to smokers, but rates are typically much higher. Some companies offer better rates for smokers than others, while some even offer an incentive to quit smoking, offering lower rates for a period of time while the insured works on kicking the habit.
Life insurance policies also may have contingencies for those that are considered “high risk”, including individuals with a family history of heart disease or cancer, or with an existing medical condition. Many policies require a medical exam as well to determine your insurability. If you qualify for coverage, rates could be significantly higher.
Overall, smokers and those with high-risk health factors will pay higher premiums, but coverage is available at most major life insurance companies.
Our life insurance methodology is comprehensive. In order to compile our list of the best life insurance companies, we researched and evaluated more than two dozen different life insurance companies. We gathered data (both qualitative and quantitative) about each company, including ratings for financial strength (using independent ratings from companies like AM Best), customer satisfaction scores (using J.D. Power ratings), as well as pricing and customer experience.
Our review process gave preference to companies that offered online quoting tools and transparent pricing. We also looked at the functionality, such as online forms and customer portals, offered by carriers for customers to manage their policies and file claims online. Companies that offered multiple forms of customer service, such as phone, email, and live chat through their websites, also received ratings boosts.
Lastly, we looked at the individual offerings available—types of policies and riders offered, as well as additional products and services, such as investment options—from each of the companies we reviewed and assessed the relative strengths of each. Of the companies we considered, those that offered numerous types of policies (e.g., term, whole, universal), riders (e.g., living benefits, waiver of premium, return of premium), and other services were given higher ratings, as we believe these companies are better positioned to help individual customers find the life insurance coverage they need.