There can be a lot to consider when shopping for life insurance. Cost and ease of application might sway your initial decision but does that make it the best choice?
When it comes to life insurance, things seem so complicated that you may not feel like shopping around. Maybe you just take the policy your company offers, and call it a day. But here’s the deal. Employer life insurance coverage is not likely enough to cover your family’s actual needs. So you’ll probably need to shop around for additional life insurance coverage of your own.
And that brings us to today’s topic. What are the best life insurance companies? Before answering that question, let’s first look at factors you should consider when making your choice.
Key Factors in Picking the a Life Insurance Company
Again, though, it can be easy to just take the most obvious option. Just sign up for insurance with the first company that pops up in an online search. But here’s why that’s not a good idea:
- Cost. By shopping around, you can ensure that you get the best possible coverage for the lowest possible monthly or annual premium. Even on small policies, costs can vary dramatically from one insurer to the next.
- Ease of application. Some companies still have laborious applications processes. You may want, for personal reasons, to skip the medical exam. Or you may want to submit 90% of your paperwork online. Either way, going with one of the best term life insurance companies will help you get through the application process easier and more quickly.
- Customer service. You may never need to call your life insurance company’s customer service line in your life. But if you pass away and your family needs to cash in the policy, will it be easy for them to do so? Checking out a company’s ratings and reviews can give you visibility into this important issue.
- Financial rating. Even though all life insurance companies seem like large entities that aren’t going anywhere, that’s not necessarily the case. You want to buy a policy with a company whose financial rating virtually guarantees they’ll be able to pay out your claim when needed. As we’ll discuss below, A.M. Best is the company that rates life insurance companies.
- Flexible options. If you just need a standard 20-year or 30-year term life insurance policy, this may not be important to you. But maybe you’re interested in additional riders, a very large or very small policy, or special terms like decreasing or increasing coverage. In this case, you’ll need to work with a company that lets you get outside the term life insurance box a bit.
With all that in mind, we’ve rated the best term life insurance companies. This will help you narrow down your list when you’re shopping for a policy. That way, you can cut down your shopping time while ensuring that you get the life insurance policy you need.
Our Picks for the Best Life Insurance Companies
So without further ado, here are the term life insurance companies we think best fit the criteria above.
Northwestern Mutual makes the cut because of its incredibly high financial rating and consistently good customer service ratings. A.M. Best gives it an A++ financial rating. And consumers consistently rate it well for customer service. What that means for you is that in the event of your death, your beneficiaries should be able to quickly and easily file your life insurance claim.
Northwestern’s customer service is good in part because it’s not completely automated. This, though, can make the application process a bit hairier. For instance, you can’t get a quote online or apply online.
However, this does mean that you won’t get an incorrect ballpark quote. The price you get when you apply with an agent in person or on the phone is what you’ll pay if you qualify.
Northwestern offers a good variety of policy types, including different term lengths. It also offers annually-renewable policies. If it turns out that you eventually need permanent life insurance, Northwestern is a good option. Its term policies are convertible to permanent life insurance.
State Farm Life Insurance
State Farm has a great customer satisfaction rating and a strong financial rating. But what really sets it apart is it robust online quote and application process. This tool walks you through every step of the process, including deciding how much coverage you actually need.
One of the strengths of this quote system, too, is that it gives you visibility into State Farm’s different life insurance policies. Once you put your information into the quote tool, you’ll be able to compare different policy lengths and types. You can also look at various riders, including a child life insurance rider or adding a second adult to your policy.
You can apply online after you get through the quote process and choose the life insurance product you want to purchase. You’ll still need to talk to an agent after your application goes through, but it does make the beginning part of the process simple.
This company actually operates a couple of subsidiaries, including Haven Life and ValoraLife. These two entities are set up specifically to move the life insurance application process online. Haven Life has consistently gotten excellent ratings since its launch, and it offers a user-friendly quote and application tool. Both Haven Life and ValoraLife offer medically underwritten life insurance, which can make your insurance cheaper if you’re in good health.
MassMutual also offers strong policies under its own name. You can get quotes directly from MassMutual online, as well, and then apply online.
MassMutual and its subsidiary companies offer a wide variety of term life insurance products. Between them, you can likely find the one that best fits your needs. Plus, they are rated A++ by A.M. Best and have high customer service ratings.
MassMutual sells life insurance online via HavenLife. One benefit is that many can qualify for life insurance without a medical exam.
Mutual of Omaha
This company underwrites policies by United of Omaha Life Insurance company. The company has an A+ financial rating from A.M Best. And they have generally good customer service ratings online.
One of the good things about Mutual of Omaha is that you can get a relatively small policy. Theirs start at $25,000. You can also get 10, 15,20, and 30 year terms. When you want a smaller policy–under $100,000–you can apply online. But if you need a bigger policy, you’ll need to connect with an agent by phone.
Mutual of Omaha has a nice online quote tool. And you can apply online, again, if you’re purchasing one of the smaller policies.
Which Should You Choose?
If you’re shopping around for a new term life insurance policy, I’d recommend getting quotes from at least two or three of the companies listed here. As long as you get a good price on a term policy that works for you, you really can’t go wrong with these companies.
With that said, if you want to be able to complete almost all the paperwork online, Haven Life through MassMutual is probably the place to start. They tend to have lower premiums than the other companies, and put most of the quote and application process online.
On the other hand, if you want to work with a longstanding company with excellent customer service ratings, consider State Farm. There’s a reason they’ve been rated highly for many years!
Really, though, you should be shopping around with at least a handful of life insurance companies before settling on the one that offers the policy you want to purchase.
Published or updated September 19, 2017.