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Best Life Insurance Companies in 2024
Regardless of how old you are, getting life insurance is one of the most important investments you can make because it provides a safety net for your loved ones after you’re gone, especially if you’re the main breadwinner of your family.
Still, before you find the right insurance policy to suit your lifestyle and wallet, you’ll also need to find a company you can trust. We’re here to help you with that.
Best Life Insurance Companies for November 2024
Everyday Life Insurance
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
Created in 2018, Everyday Life Inc. is a reputable online insurance provider aggregator offering term, whole life, and accidental death insurance. Instead of simply offering a static quote, the company uses a calculator to crunch the numbers and provide custom-based coverage that best fits your needs and budget. Read more
AIG
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
With roots dating back to 1919, AIG is one of the older insurers in the United States. Thanks to its no-nonsense approach and diverse product offer, you can rely on this company for quality insurance. Read more
Haven Life
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
Haven Life is an up-and-coming agency founded in New York, in 2014. It’s a young company and one of your best bets if you’re looking for cheap term life policies. Read more
Mutual of Omaha
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
Mutual of Omaha prides itself on its commitment to the consumer. Its high customer satisfaction scores and history of transparent business dealings make it one of the leading life insurance companies in the US. Read more
Lincoln Financial
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
Founded in 1905 and named after Abraham Lincoln, Lincoln Financial is one of the most reputable companies on our list. It excels at providing life insurance to older customers and customers with complex health conditions such as diabetes. Read more
SBLI
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
SBLI offers competitive prices and quick underwriting processing, and is one of the most affordable companies for individuals across all age groups. Read more
John Hancock
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
The history of John Hancock dates back to 1862. This life insurance company is one of the biggest globally. The thing that makes this company unique is that it ties its policies to the John Hancock Vitality Program. Read more
Sproutt
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
Sproutt is an online insurance marketplace that harnesses technology to make life coverage more accessible. Although focused on young and healthy individuals, the provider still offers solid options to older applicants with existing health conditions. Read more
Top 5 Life Insurance Companies - Our Picks for 2024:
- AIG: Best premium rates
- Haven Life: Best for simple application
Everyday Life Insurance: Best for no medical exam applications
- Mutual of Omaha: Best for customer service
- Lincoln Financial: Best for seniors
Detailed Reviews of Life Insurance Companies
Everyday Life Insurance
- • No health exam from over 90% of the applicants
- • Policies from trusted underwriters
- • Rapid approval
Everyday Life Insurance is a digital insurance company with a twist that’s licensed to operate in all 50 states. The company offers policies designed to lower coverage and costs as your demands change over time, instead of providing the same coverage for the duration of a client's life and thus charging a higher monthly premium.
Everyday Life aims to make life insurance more affordable and accessible by avoiding unnecessary coverage add-ons and using technology to streamline the process.
Financial Security and History of the Company
Everyday Life Inc. is a digital life insurance advisor and brokerage founded in 2018 and headquartered in Boston, Massachusetts.
The company boasts an A+ rating with the Better Business Bureau (BBB) and is backed by the Financial Health Network. Everyday Life Inc.’s list of insurers includes: FidelityLife, William Penn, Bestow, Assurity, BannerLife, and SBLI.
Everyday Life offers its users a unique online calculator equipped with its proprietary Predictive Protection™ Technology, to determine exactly how much coverage they need within minutes, without any paperwork.
Not only will you get your quote in no time, but you'll be able to sign up just as swiftly, since 90% of applicants won't need to go through a health exam. Finally, you'll be 80% more likely to get approved at the quoted price, which is double what you can expect from other providers.
Product Range
The company has several types of policies: term life insurance, whole life insurance, and accidental death insurance. Everyday Life reviews whether you need temporary coverage or a more permanent solution, and matches you with the best option.
Accidental death insurance is a flagship product of Everyday Life Inc. It is a policy that pays out a death benefit if the policyholder dies as a result of an accident. Its coverage ranges from $50,000 to $350,000 for ages 18 through 60, and it's renewable until the age of 80.
This package doesn't require a medical exam and boasts a quick and easy application process that takes just two business days.
Term life insurance provides coverage for a set period. Everyday Life’s partners have policies lasting 10, 15, 20, 25, 30, 35, or 40 years; the amount can range from $25,000 and might not have an upper cap, depending on your plan.
Everyday Life will review your term life insurance application as long as you’re between 18 and 75 years old. You won’t need to undergo a medical exam either, and you'll get Instant coverage upon approval.
Finally, whole life insurance is the most comprehensive plan, but it also comes with a higher price tag. Everyday Life offers whole life insurance policies from $5,000 to $35,000 for applicants ages 50 through 85.
You can get perks such as cash value accumulation, RPU, and automatic premium loans. Everyday Life guarantees level premiums for the life of the policy, so you'll never have to worry about your rates going up.
Monthly rates start at as little as $6.91 per month, depending on your chosen policy, which is lower than most companies on our list.
Customer Satisfaction
Everyday Life Inc boasts a high 4.4-star rating (out of 5) on Trustpilot, with most of the customers praising the swift and easy application process, as well as the honest and straightforward approach to quotes.
The company has also acquired an A+ rating with the Better Business Bureau, and all of its underwriters boast ratings with BBB and AM Financial Strength that span from A- to A+.
Bottom Line
Everyday Life Inc. is an online insurance brokerage that connects its applicants with reputable underwriters. It's a one-stop shop for all your life insurance needs, with comprehensive coverage options and competitive rates.
Everyday Life offers an excellent value proposition to most people looking to get insured.
You can get a quote and apply for coverage in just minutes, and you're likely to be approved at the quoted price. All in all, applying to Everyday Life is a no-brainer for those in need of affordable long-term insurance policies.
AIG
- • Competitive rates
- • High financial security
- • Various policy riders
With roots that date back to 1919, AIG is one of the oldest insurance companies in the United States. It has a long history of customer satisfaction and prosperous business dealings.
Expect to see the most competitive rates in the industry and experienced insurance agents who will make sure you pick the product that’s right for you.
AIG should be the first choice for customers who have complex health histories and are worried that they might not be able to get a good deal on monthly premiums. AIG will provide you with excellent term insurance options at great rates.
Financial Security and History of the Company
AIG is the fifth US insurance company by total assets, and it has been around for over a century. This company has an A rating by AM Best, indicating that it’ll be around for a long time to come.
Product Range
AIG offers both term life insurance and whole life insurance, plus several policy riders for consumers who want to customize their policy.
When it comes to term insurance, here are the riders you can expect: child protection rider, accelerated death benefits, and disability waiver of premium.
A child protection rider provides insurance for children from 15 days to 19 years of age, and it allows for $500-$25,000 worth of coverage.
An accelerated death benefit lets you speed up your death benefit by 50% if you’ve been diagnosed with a terminal illness, and a disability waiver of premium lets you waive all premiums if you become completely disabled.
The company’s average monthly premiums for healthy people in their twenties are about $25, compared to the industry standard of $26. Those in their fifties can expect the quotes to be tripled.
When it comes to whole life coverage, AIG offers guaranteed issue insurance. You won’t have to subject yourself to a medical exam, but the policy is very expensive.
As for payment, AIG accepts bank checks, automatic account drafts, and credit card drafts (for the first payment only).
Customer Satisfaction
Consumer reviews of AIG are quite mixed. There’s a huge number of satisfied customers who have left positive reviews over the years, but nonetheless, AIG only earned a 2/5 J.D. Power rating.
The most common complaint is that it takes a long time for applications to get processed - in fact, AIG is one of the slowest companies on our list.
Despite this, consumers are satisfied with payment terms, and the sheer number of customers makes it obvious this is a trustworthy company.
Bottom Line
AIG offers some of the most favorable rates on the market. If you’re looking for competitive pricing, this company should be your very first choice.
Haven Life
- • Simple application process
- • Affordable rates
- • Special features with every policy
Haven Life is an up-and-coming agency founded in New York in 2014.
Despite being new in the market dominated by venerable centenarians, Haven Life is a fairly secure insurance provider backed by MassMutual, a Springfield-based company that’s been in business for over 160 years.
Haven Life’s main aim is to make the hassle of insurance shopping as straightforward and easy as possible. Everything is managed online through a simple interface.
Financial Security and History of the Company
According to the AM Best rating, Haven Life is a secure company you can trust your money with. Their biggest downside is the fact it doesn’t have a long record - with not even a decade in business, it doesn’t have the experience larger companies have acquired over the years.
However, it’s backed by a much larger company, MassMutual. MassMutual has more than a century and a half in business, and the fact that it’s backing Haven Life makes it obvious that the company is worth your time.
Product Range
Haven Life doesn’t offer permanent insurance. Its product range is limited to term insurance only.
According to the company, this is what its client base demands the most, so it specializes in it and offers some of the most affordable rates on the market.
It also has a special feature called Haven Life Plus you can add to your policy. This feature enables several benefits:
- 15% discount on one CVS MinuteClinic service
- An online deposit box for you and five family members
- A digital service to create an online will with no charge for the first year
Customer Satisfaction
Haven Life has excellent customer service, and consumers are generally satisfied with its insurance products. Its 3/5 J.D. Power score is average.
On the one hand, most reviewers praise Haven Life’s quick policy turnaround and an easy online application process.
On the other hand, everything is done online, so you won’t get in contact with agents who could help you. However, the company’s website offers a live chat option you can access at any point.
Bottom Line
Haven Life is a new insurer, but it offers cheap coverage options and is backed by MassMutual, which has a long, successful history.
Everything here is done online, so if you’re looking to avoid insurance salesmen and need something affordable, this is a great option to test.
Mutual of Omaha
- • Transparent fees
- • Great customer service
- • Wide variety of products
Mutual of Omaha is the kind of company that prides itself on commitment to the consumer. Its high customer satisfaction scores and a history of transparent business dealings make it one of the leading insurers.
They are generally oriented toward younger customers, and if you’re currently in good health, you could get some of the most competitive rates on the market.
Mutual of Omaha is also great for people with specific health conditions. Since different companies treat various health conditions differently, it’s often worth shopping around to see who will give you a better rate.
Financial Security and History of the Company
The company has been in business for more than a century. You don’t need to worry about whether it’ll be around when you need it the most, and more than half a million customers can confirm it’s the real deal.
Mutual of Omaha is a good choice if you’re on the hunt for straightforward insurance contracts where all of the important details are clearly outlined. It has an A+ rating with AM Best and a long list of insurance products to suit your needs.
Product Range
Mutual of Omaha has a great range of products to choose from. It offers both term and whole life insurance and various riders to help you customize your policy.
The most straightforward term life insurance is called Term Life Answers, and you can choose from five riders: child protection rider, other insured rider, disability waiver, unemployment waiver, and accelerated death benefit. Overall, this is one of the finest life insurance policies in regards to premium rates.
Mutual of Omaha also offers Term Life Express, which gives a no-exam option to customers who are applying for a policy that starts at $25,000 and goes up to $300,000. Term Life Express offers the same types of riders as Term Life Answers.
Mutual of Omaha’s whole life insurance is called Living Product, and it doesn’t require a medical exam. It’s a very costly policy. You can expect accelerated death benefit and accidental death benefit riders.
Customer Satisfaction
Overall, customers are very satisfied with Mutual of Omaha. Complaints are mostly related to the fact that you can’t update your policy online and the fact there’s a slower turnaround for activating the policy.
Bottom Line
Mutual of Omaha is a great company, but the policies are better suited to either healthy people or those with common health conditions such as cancer, sleep apnea, or high cholesterol. The company offers great rates to customers with these conditions.
Lincoln Financial
- • Best choice for seniors
- • Excellent for people with complex health histories
- • Many life insurance policies offered
Founded in 1905 and named after Abraham Lincoln, Lincoln Financial is one of the most reputable companies on our list.
It excels at providing life insurance to older customers and those with complex health conditions such as diabetes. It offers them some of the most competitive rates.
Financial Security and History of the Company
With over 17 million customers, Lincoln Financial is a reliable company that most certainly won’t go bust. When the time comes for your beneficiaries to make use of this investment, they’ll be fully covered.
Lincoln Financial has an AM Best rating is A+, meaning this is a certified and trustworthy carrier.
Product Range
Lincoln Financial offers the following products: term life insurance, universal life insurance, variable universal life insurance, and indexed universal insurance. Indexed universal insurance offers cash-value opportunities linked to the market’s index performance.
When it comes to term life insurance, these are the riders you can choose from: child protection rider, accelerated death benefit, and disability waiver. You can expect affordable offers for seniors, but slightly more expensive premiums for younger individuals than is the industry standard.
Premiums can be paid through automatic bank withdrawals or checks on a monthly basis, but you can also use your credit or debit card for the very first payment. If you want to change your policy, you won’t be able to do it online — a phone call is required.
Customer Satisfaction
Lincoln Financial’s J.D. Power rating is 3 out of 5, meaning this company could be doing a little better.
The company has a lot of customers, and complaints mostly involve the overly long application process.
Bottom Line
Lincoln Financial is one of the largest insurance companies in the United States, and it’s a great choice for senior customers and customers with complex medical histories.
If you’re young and healthy, other companies could give you better rates, but otherwise, this is a great choice.
SBLI
- • Company with over a century of experience
- • Fast turnaround
- • Online processing
SBLI offers competitive prices and quick underwriting processing, and is one of the most affordable companies for individuals across all age groups as long as they are in good health.
SBLI is a smaller carrier, so it hasn’t been graded by J.D. Power or Consumers Advocate. Expect a faster turnaround time than usual, good insurance agents to help you out, and added benefits such as online processing.
Financial Security and History of the Company
SBLI has been around for over a century. It has more than half a million customers. The company is financially stable and reliable and has an AM Best rating of A, meaning that it can easily handle demands and meet the obligations of policyholders.
This company is likely to be able to pay out any amount for death benefits after your passing, so you’ll be putting the future of your family in very safe hands.
Product Range
SBLI offers both term and whole life insurance, and finds itself on our list because it offers competitive rates along with transparent terms and conditions.
SBLI offers the following riders to its customers: child protection, disability rider, accelerated death benefit, and accidental death benefit.
SBLI also offers a unique insurance product - SmartTerm 360. Since customers sometimes end up overpaying for their life insurance, SmartTerm 360 was designed to evolve over time as your needs change during your lifetime.
You still get a federal income tax-free death benefit, but the insurance provides more specific coverage and makes sure you save money by keeping you from being overinsured.
SBLI offers competitive rates to policyholders of all ages, but only if they’re in good health. If you have common conditions such as diabetes or high cholesterol, you might end up having to pay more for your monthly premiums.
If you don’t have any health conditions, then this is an excellent choice. SBLI term life products are available in all the states except for New York.
Customer Satisfaction
Customers generally praise SBLI’s fast application process and turnaround time, and the company gets good reviews across the board.
Its fast turnaround process is due to accelerated underwriting you can apply for, which doesn’t require an attending physician statement.
To apply for fast underwriting, you must be under 60, a nonsmoker, in good health, and live a low-risk lifestyle.
Bottom Line
This is a good choice for people who don’t have any serious medical conditions and want a reliable, professional agency to handle their insurance.
John Hancock
- • Financially secure company
- • Great for applicants with certain medical conditions
- • Online processing
The history of John Hancock reaches all the way back to 1862, and the company is now regarded as one of the leading insurers in the world.
The thing that makes John Hancock unique is that it ties all its types policies to a health and lifestyle program called the John Hancock Vitality Program. It comes with a free FitBit and encourages you to lead a healthy life.
Financial Security and History of the Company
John Hancock holds an A+ AM Best rating, meaning that it’s financially strong and will be around when the time comes for your beneficiaries to collect insurance death benefits.
The company has been in business for over a century and a half, and it’s not likely to go belly up any time soon.
Product Range
John Hancock has a useful calculator that makes it easy to get approximate rates if you answer a few questions about your age, sex, and lifestyle.
John Hancock offers term life insurance, permanent life insurance, and guaranteed-issue whole life insurance. Compared to other agencies, it has competitive pricing, even for customers who are dealing with health issues.
John Hancock offers excellent coverage for heart attack patients, high cholesterol patients, high blood pressure patients, and even former tobacco users.
This company allows for electronic applications, but you can’t make too many amends to your policy online.
To do things like changing your beneficiaries or change your address, you’ll have to give them a phone call and provide a few paper forms.
Customer Satisfaction
John Hancock is widely regarded as one of the leading companies in the US, but a number of policyholders have had issues with its customer service in the past.
Some of the biggest complaints about John Hancock is that it has long, complex application forms and that it takes longer than average for applications to get approved.
Bottom Line
If you have a health condition and you’re worried about the cost of insurance, check John Hancock’s quotes. The company offers competitive prices and is both reliable and financially solvent.
Sproutt
- • Connects prime candidates with low rates
- • Medical exam isn’t always required
- • Access to human advisors if necessary
Sproutt is a fintech lending marketplace that promises to match your needs and budget with the right products, taking into account your lifestyle choices such as your sleeping pattern and how much time you spend with your family.
Although primarily geared toward young and healthy people, Sproutt also caters to high-risk applicants who may struggle to find affordable options from other companies.
Financial Security and History of the Company
Sproutt is an insurance marketplace that connects customers with the most suitable carriers.
Launched in December 2019, this platform is a part of the insurtech network, a new wave of insurance startups that aim to simplify the process of buying insurance by using proprietary technology to match applicants with suitable vendors.
Product Range
Types of life insurance offered on Sproutt’s website include term, whole life, universal, variable, simplified issue, and guaranteed issue life insurance. Coverage amounts range between $50,000 and $5 million.
Requesting a quote takes about 10 to 15 minutes. To start the procedure, you’ll be prompted to fill out a health assessment questionnaire.
In addition to sharing your personal and contact details, annual income, and the number of dependents, you’ll also be asked to provide information about your basic health history and lifestyle, including travel plans and potentially hazardous hobbies.
Note that Sproutt also inquires about recent traffic violations and felony convictions.
After filling out the form, you’ll receive your Quality of Life (QL) Index score, which will be used to match you with the most suitable provider based on your preferences, budget, and lifestyle.
The cost provided by Sproutt will ultimately depend on your preconditions, term, and coverage amount and may vary between $10 and $90.
Customer Satisfaction
Accredited by the Better Business Bureau since 2019, Sproutt currently holds an A+ rating for interaction and customer support.
On Trustpilot, the marketplace earned 4.8 out of 5 stars based on a few hundred reviews.
Satisfied customers commented on the speed and simplicity of the buying experience, particularly praising the team’s response time.
Those few who weren’t so happy with Sproutt’s policies mentioned they received incorrect information about third-party vendors.
Bottom Line
Sproutt has already managed its place in the competitive market. Given its quick and easy application process and affordable policies provided by reputable insurers, this tech-based insurance startup seems to be heading in the right direction.
The only problem may be that the company doesn’t offer as many options for older and unhealthy people as it does to young and healthy individuals.
The Main Reasons You Need Life Insurance
You might be wondering why you even need life insurance and whether insurance companies are just lying to you when they claim it’s a necessity. We’re here to answer, and we’ll be straightforward - life insurance is generally a good idea.
It’s not necessary, and there are other ways to cover for your family and make sure they’re settled, but insurance does make it easier. As long as you pick the right life insurance, you’ll benefit.
We’ve decided to outline the reasons we think insurance is good for you:
It Makes Sure Your Family Is Covered
This is the main reason people purchase life insurance plans. In the case you suddenly pass away, your family could be left stranded. No one expects great misfortunes to befall them, and yet they do sometimes happen. While most families have family members who live well into old age, not everyone is so lucky.
Disease and accidents also happen, and if you’re caught completely off guard, you might have a very hard time taking such a hit. Your family could be left with more household and childcare expenses and no financial backing.
If you parse through some of the quotes online, you’ll see that insurance can actually be quite affordable, especially for younger people in good health. It’s a small price to pay for something that’ll ultimately give you and your family a strong safety net.
It Gives You Peace of Mind
No matter what happens, you’re covered. Your family is covered. Everyone is safe. There’s a lot of comfort in knowing that you’ve done all you could to keep your loved ones out of harm’s way and provide for them.
If you find the right insurance option, you’ll be able to sleep better at night because everything will practically be arranged. If you start investing in this while you’re still young, it definitely won’t eat too much into your monthly budget, and you’ll get plenty of benefits for a small price.
It Helps You Pay Off Debt
Funerals are expensive, car loans are more expensive, and mortgages are yet even more expensive. Debt can pile up, and if you’re not there to pay it off, the burden will fall onto your family. When it comes to life insurance, a good company won’t let this happen.
Don’t allow your children and spouse to suffer a financial burden in addition to an emotional burden in the case of your sudden death.
It Improves Your Children’s Financial Security
As your child grows up, they’ll start having dreams about how they want to live their life. Perhaps they’ll want to get into a pricey college and get the best education in the world, or maybe they’ll want to start their own business.
Until they grow up and become fully independent, extra money could help them get the financial backing to pursue successful careers and relationships.
It Helps You Leave An Inheritance
If you don’t have any assets to leave to your children, life insurance could actually help you create an inheritance. Once you choose the right policy and find the company that best suits your needs, you can name your family members as your beneficiaries.
Pay your premiums regularly, and your children will still have some solid financial backing even after you’re gone.
How We Evaluate Life Insurance Companies
We believe that everyone should have a firm grip on their finances, and knowing what you’re getting into when you buy a financial product is the first step toward that goal.
As with every review, we’ll provide you with each and every detail of how we picked the most reliable life insurance companies.
Company History and Financial Strength
There are a lot of startup insurance companies popping up every year. They offer great deals made to draw new customers in, and you might be tempted to jump at a good opportunity.
However, caution is advised here. You’re committing to something that you’ll have to keep paying for decades to come, and you want to find the kind of company that can really pay its claims many years down the road.
You’ll find the right life insurance policy only if you carefully consider the company’s history and its financial strength. We’ve done just that for you.
We made sure to research the history and financial backing of every company on our list. These companies won’t scam you or waste your money.
AM Best Rating
AM Best is a global agency that provides credit ratings for insurance companies. It’s internationally recognized for its analysis of a company’s creditworthiness and financial strength. If you want to know which places are worth their salt, AM Best can tell you.
We advise that you only go with companies that are rated B or higher with AM Best.
J.D. Power
J.D. Power is an agency that rates companies on customer satisfaction and reviews provided over the years. J.D. Power uses a scale from 1 to 1,000, and it can help you see how companies fare based on consumer reports. Good companies generally have a score higher than 700.
Customer Satisfaction
In addition to the official J.D. Power scores, we’ve also examined a randomized assortment of reviews we found online.
We’ve looked through reviews from the Better Business Bureau along with a few other sources - just to make sure we get a more complete picture. In our experience, it’s not a good idea to only trust one extremely positive or extremely negative rating.
Product Selection
There are many types of life insurance. We gave the highest ratings to companies that offered a wide variety of products to their consumers.
Every individual’s needs are unique, and you’ll need to find the kind of place that is both reliable and has the type of life insurance that you can afford. We also want you to know what kind of options you can expect to find.
Here’s a rundown of the types of life insurance you can find:
- Term life insurance
- Whole life insurance
- Permanent life insurance
- Universal life insurance
- Variable life insurance
- Universal variable life insurance
- Final expense insurance
- Group life insurance
- Guaranteed life insurance
Term Life Insurance
Term life insurance is the most straightforward kind of insurance. You’re paying exclusively for the death benefit that goes toward your beneficiaries after you pass away, and all of the largest companies offer this type of product.
This benefit is usually paid out as a lump sum, but it can also be paid in monthly payments or annuities.
These policies are usually aimed toward young, healthy people, and they are paid over a period of 20-30 years. The premiums for young, healthy people are usually around $30-$40.
Whole Life Insurance
Whole life insurance is about six to ten times more expensive than term life insurance. It stays in effect as long as you pay your premiums, and it’s a financial product that’s supposed to be a mix of insurance and investment.
Your beneficiaries will still get a death benefit after you pass, but there’s also a cash value component to whole life insurance. Cash value is basically a savings account.
In general, this isn’t a great way to get the lowest rates because you’ll have to pay much more toward your premiums than with term insurance, and for the first 5 to 10 years, most of the premiums will go toward the death benefit instead of the cash value.
After you start paying more toward the cash value, you might get dividends, depending on the terms of the company where you purchase insurance.
Universal Life Insurance
Similarly to whole life insurance, universal life insurance comes with both a death benefit and a cash value. Its main selling point is that policyholders can change the premium and death benefit amounts without having to get a whole new policy.
You will have to pay a premium minimum to keep the policy in force, but you can use the cash value to pay off your minimum. When comparing companies, we found that a lot of the best ones offer this financial product in their repertoire.
Universal life insurance changes according to the market. The current market interest rates will influence the insurance interest rates, making this a tricky financial product to manage.
Variable Life Insurance
Variable life insurance is also similar to whole life insurance, but the cash-value component is different. The cash-value is placed on the stock market, so it varies a lot and can cause both potential gains and losses.
This is a series of mutual fund-like subaccounts, and you can only choose from the investment options available through your policy. The rest of the stock market investments won’t be available to you.
This insurance product is risky because it requires some stock market knowledge to make it work. However, if you have investment experience, this can be a great choice. Just make sure to pick insurance carriers that will outline the terms of this product transparently.
Variable Universal Life Insurance
Take variable life insurance, universal life insurance, and voila, you get the mishmash that is variable universal life insurance. This product takes adjustable premium and death benefit amounts from universal life insurance and the investment options from variable life insurance.
It’s kind of a jack of all trades and master of none. You get life insurance, but it can be pricier than term life insurance, and you get investment options, but it’s a lot more complicated than simply investing in the stock market separately.
However, it can be a good choice for people who want to keep everything in one place. If you like this type of product, read our reviews to find out which companies offer it.
Final Expense Insurance
Final expense insurance is all about your literal final expense - the funeral. This product covers everything from medical stays to cremation, which can pile up to $8,000.
This insurance can be attractive to older people who haven’t applied for insurance of other types and don’t want to burden their families with the cost of their funeral. It’s relatively expensive given the low coverage and high premiums you’ll have to pay.
However, every good company will almost always offer this type of product, and it’s a great option to consider if funeral costs are your only worry.
Bear in mind that this type of product often has a cash value component that grows over time, and that you’ll have to fill out a health questionnaire.
Simplified Issue Life Insurance
The biggest benefit of simplified issue life insurance is that it lets you skip the medical exam that’s usually required by insurance agencies. Medical exams are standard procedures that help agencies determine what kind of premium to set, and they’re usually not an issue for people who are young and healthy.
Simplified issue life insurance lets you skip exams entirely, but you’re still required to fill out a questionnaire that contains questions about your health and lifestyle. You’ll be asked whether you’re a smoker, whether you’ve been diagnosed with a serious illness, and whether you exercise regularly.
Every company with an AM Best rating will offer this type of service but bear in mind that it comes at a cost. Premiums will generally be more expensive by default, and it’s not guaranteed that you’ll get better rates than you would with simple term life insurance.
Guaranteed Life Insurance
Guaranteed life insurance is similar to simplified life insurance, but you get to skip even the health questionnaire. All you need to tell your insurer is your age, sex, and state of residence, and they’ll cover you for a pretty hefty price.
This is an expensive financial product, but it’s a good option for older people who have a hard time finding life insurance. Basically every company will offer it as an option if you’re a senior citizen and don’t mind paying higher premiums.
Just to make sure this really pays off, try getting quotes for regular term insurance first before opting for this product.
FAQ
What is term life insurance?
Term life insurance is the kind of insurance that lasts for a predetermined period of time - a term. It’s among the most affordable insurance products, and all of the life insurance companies offer it in their repertoire of products.
Term insurance is there to create a safety net that’ll help you cover unexpected costs or debt, and if you die before the term is up, your beneficiaries (usually family members), will get the death benefit that is usually paid in the form of a lump sum.
This lump sum can be used to cover the costs of the funeral, to pay the bills, to pay college for your children, or in any other way your beneficiaries want.
What is whole life insurance?
Whole life insurance covers you throughout your whole life, but it’s a lot more expensive than term insurance. You’ll be paying more on a monthly basis to get the benefits of coverage, but you’ll also enjoy some cash value benefits that term insurance doesn’t have.
What is the difference between whole and term life insurance?
Term insurance covers you for anywhere between 10 and 30 years. Whole life insurance covers you for your entire life. Whole life insurance is more expensive and more difficult to adjust, but it gives you some cash value which functions as an investment tool.