[Last updated January 10, 2024]
Life insurance can ease your loved one’s burdens in the event of your passing by building up funds and financially preparing for the future. Depending on the policy, you may also be able to use funds to help pay for your senior care needs during your lifetime. Many providers offer this kind of insurance, so it’s important to find an insurance policy and provider that suit your needs. Here, we describe some of the best life insurance providers and define terminology you may need to know.
What is life insurance?
A life insurance policy pays a predetermined amount of money to designated beneficiaries after the policyholder passes away. Prior to that, the policyholder pays a premium throughout their life — either in monthly installments or as a single, upfront payment.
The right kind of life insurance — and the cost — will depend on factors such as medical history, family history, lifestyle, gender, and age. For example, smokers or those with heart conditions may find it difficult to obtain a policy with the optimal amount of coverage due to the risk factors associated with their health.
Different types of life insurance policies exist to meet individuals’ varying needs, whether you want coverage for a certain number of years, the rest of your life, or other options. A few main types of policies you can get are:
•Permanent life insurance: These types of policies last for the rest of the policyholder’s life. There are various options for permanent life insurance, including whole life insurance, universal life (UL) insurance, and indexed universal life (IUL) insurance.
Permanent life insurance policies can end, though, if the policyholder doesn’t pay the premium payments or if they relinquish the policy. Policyholders will pay more for permanent life insurance but with the added benefit of having coverage for longer than a term life policy.
•Term life insurance: This type of policy offers coverage for a set term or period of time, typically between 10 and 30 years. At the expiration of the term, policies can be renewed to remain active.
Typically, term life policies are cheaper than permanent policies. In addition, policyholders can expect to make consistent payments. Those looking to purchase term life insurance will find a few options: decreasing term life insurance, convertible term life insurance, or renewable term life insurance.
The top life insurance providers
Now that you know the basic types of policies that are available, let’s take a look at the top life insurance companies in the United States that offer these policies.
Best overall: Bestow
Bestow offers term policies but does not offer riders (optional policy add-ons) or permanent policies. Coverage lasts between 10 and 30 years and ranges between $50,000 and $1.5 million. With Bestow, medical exams aren’t necessary to obtain coverage. However, according to U.S. News, Bestow will reference credit and medical history, driving records, and previous purchase attempts for insurance policies when evaluating potential policyholders.
Best for no medical exam: Corebridge Financial (formerly AIG)
With Corebridge Financial, applicants can apply for either term, permanent, or final expense life insurance. Even more, policyholders under certain term policies may be able to convert their policy to a permanent policy. Certain policies don’t require a medical exam, and Corebridge Financial provides free quotes within minutes if you submit information online or call its dedicated quote hotline. Corebridge has life insurance agents to help guide applicants through the process.
Best for online applications: Haven Life
Digital life insurance agency Haven Life is a great choice for a provider as they offer two policy options: Haven Term and Haven Simple. Haven Term policies offer coverage spanning 10 to 30 years, with up to $3 million in coverage. Haven Simple offers policies with coverage amounts ranging from $25,000 to $1,000,000 that last between five and 20 years. You can purchase policies online, and some applicants don’t need a medical exam to obtain coverage.
Best for estate planning: Lincoln Financial
Lincoln Financial, established in 1905, offers competitive rates on hybrid long-term life insurance policies with no waiting period. Term life policy customers will find that the maximum age to convert to a permanent policy is higher than many competitors, as Lincoln Financial will allow you to convert your term policy to a permanent policy until age 70. When it comes to whole life policies, many life insurance providers will deny customers over age 70, whereas Lincoln Financial approves applicants up to age 80, making their policies a great option for those planning their estates.
Best for Gen X and Millennials: Mutual of Omaha
Mutual of Omaha has been around since 1909 — and for good reason. The company is financially sound, meaning it should have no problem paying out claims years or even decades down the line. On its easy-to-understand website, Mutual of Omaha offers various whole, term, and universal policies, along with the option to add a variety of life insurance riders to fit each policyholder’s needs.
Best for variable universal life insurance: Pacific Life
Founded in 1868, Pacific Life offers indexed universal, variable universal, term life, and fixed-rate universal life insurance policy options. It was voted by Forbes as the “Best for Variable Universal Life” and offers competitive rates. With Pacific Life, policyholders will find that their cash value will typically build faster than with other providers, as Pacific Life has a long track record of making great investments for its clients.
Best for term life insurance: Protective
Protective offers term and permanent life insurance policies for those ages 18 to 90. The Protective Classic Choice Term life insurance policy allows people between 18 and 52 to get a policy with term periods between 10 and 40 years. These policies have coverage ranging from $100,000 to $50 million, and they are renewable until the policyholder turns 90 years old.
Best for universal life insurance: Prudential
Prudential offers term and permanent life insurance policies and rider options (depending on the plan). Prudential’s online benefits include viewing account information, accessing resources using an online database, and filing claims online. Applicants can use the online service to receive term quotes quickly without a medical exam. They can also get assistance finding the right policy via a Life Insurance Virtual Chat assistant.
Best for coverage amount customization: New York Life
As the U.S.’s largest mutual life insurance agency, New York Life offers permanent and term plans with a wide variety of riders, making their policies incredibly customizable. Their policies come at a higher cost than some competitors, but the highly rated company offers exceptional whole and universal policies and term policies that can be converted. Additional benefits include rider options such as living benefits, accidental death benefits, and disability waiver of premium.
Best for customer experience: Northwestern Mutual
Known for its superb customer support, Northwestern Mutual provides permanent life insurance policies and term policies, which offer coverage between 10 and 20 years and can be converted to a permanent policy without additional fees or a medical exam. Customers can purchase policies through Northwest Mutual by calling a life insurance agent, allowing customers to ask questions and learn about options and policy customization.
Essential terminology for life insurance
Understanding the terminology used in life insurance policies is crucial for making informed decisions. Here’s a guide to some key terms:
- •Accidental death benefit: A rider that provides an additional benefit if the insured’s death is accidental.
- •Beneficiary: The person or entity designated to receive the death benefit from a life insurance policy upon the insured’s death.
- •Cash value: A savings component included in some permanent life insurance policies, which can accumulate tax-deferred value over the policy’s lifetime.
- •Convertible term insurance: A term life policy that offers the option to convert to a permanent policy without a medical exam.
- •Death benefit: The money paid out by the life insurance company to the beneficiary upon the insured’s death.
- •Exclusions: Specific conditions or circumstances for which the policy will not provide coverage.
- •Grace period: A period after the premium due date during which the policy remains in force even though the premium is not paid.
- •Insurability: The eligibility to obtain life insurance based on factors like health, age, and lifestyle.
- •Lapse: The termination of a life insurance policy due to nonpayment of premiums.
- •Premium: The payment made to the insurance company in exchange for coverage. Premiums can be paid monthly, annually, or in lump sums.
- •Rider: An add-on to a life insurance policy that provides additional benefits or adjustments to the coverage. For instance, a long-term care insurance rider may be added to a policy to help the insured pay for assisted living or home care.
- •Underwriting: The process used by insurers to assess the risk of insuring a potential client, which involves evaluating the applicant’s health, lifestyle, and medical history.
- •Universal life insurance: A flexible type of permanent life insurance that allows policyholders to adjust their premiums and death benefits.
- •Whole life insurance: A type of permanent life insurance with fixed premiums and guaranteed cash value growth.
Understanding these terms can help you navigate life insurance’s complexities and choose a policy that aligns with your needs and financial goals. Consult with a financial adviser or insurance specialist for more detailed information or specific advice.
