There is no such thing as a best term life insurance policy for everyone – what works for you may not work for someone else. When shopping for life insurance, it is important to consider factors such as coverage amounts, term lengths, age restrictions, and whether or not the policy can be converted to permanent coverage. Some of these factors may be more important to you than others.
Top 5 best overall
Ladder Life
Ladder Life is a life insurance company that offers a completely online experience for individuals who want quick and affordable term life insurance. Eligible applicants must be between 20 and 60 years old, and although guaranteed life insurance isn’t offered for all coverage levels, a medical exam is not necessary for those wanting $3 million or less in coverage.
Ladder Life matches applicants with its life insurance partners like Allianz Life Insurance Company and Fidelity Security Life Insurance Company. If you’re looking to buy life insurance on your own, Ladder Life could be a great fit. Keep in mind that the options are limited. Term life is the only type of policy available and there are no additional features or riders that can be added to further personalize your policy.
Mutual of Omaha
Mutual of Omaha has been providing quality insurance products since 1909. They offer whole life and universal life policies, as well as term life coverage with limits starting at $100,000. For term life coverage, they sell to customers between 18 and 80 years old, and offer terms ranging from 10 to 30 years.
Mutual of Omaha offers the option to add accidental death coverage to a life insurance policy. This means that if the policyholder dies as the result of a covered accident, their beneficiary will receive a payout. You can get a quote for this coverage online, but will need to speak to a representative to finish the application and purchase the policy. It’s important to note that Mutual of Omaha only has locations in 34 states, so if you prefer having a local agent, make sure there is one in your area before starting the quote process.
Liberty Mutual
Despite not being ranked in the 2021 J.D. Power U.S. Life Insurance Study, Liberty Mutual is still a company worth considering. They have received an A (Excellent) financial strength rating from AM Best, which means they have a strong ability to meet financial obligations, like paying out death benefits. They offer whole life insurance and term life policies, as well as simplified issue term and whole life policies that don’t require a medical exam.
You can begin the process of getting a life insurance quote from Liberty Mutual online, but will need to speak with one of its agents to finalize the purchase. Liberty Mutual has a lot of options for riders and added benefits to customize your life insurance policy to best fit your family’s needs. That being said, Liberty Mutual’s overall complaint index is higher than average, at 2.66, as reported by the National Association of Insurance Commissioners (NAIC). This might not be the best option for those customers who are looking for the company with the best customer service rating.
Northwestern Mutual
Northwestern provides a multitude of life insurance policy options, including term, universal, and whole life, as well as annuities and long-term care insurance. A 35-year-old man in good health can get a $500,000 policy from Northwestern for as little as $306 a year, an advertisement from the company states. This premium amount increases annually.
The provider in question only offers medical exam life insurance, so if you’re looking for guaranteed acceptance insurance, this provider may not be the right choice for you. However, Northwestern Mutual does offer conversion riders, which allow you to convert a term life insurance policy to whole life coverage without having to take another exam, and you can lock in your premium for the rest of your life. While you can’t get a quote online from Northwestern Mutual, you can use its life insurance calculator to estimate how much coverage you need.
State Farm
Thanks to its exceptional J.D. Power customer satisfaction score and its availability in most states, State Farm won a 2022 Bankrate Award for best term life insurer. State Farm’s term life policies go the extra mile by providing coverage that is renewable up to age 95, while most competitors terminate coverage after you turn 80.
If you qualify for State Farm’s Instant Answer policy, you can get up to $50,000 in term life coverage without taking a medical exam. You may also be eligible for a multi-policy discount on auto insurance if you purchase life insurance through State Farm. According to the National Association of Insurance Commissioners (NAIC), State Farm has fewer-than-baseline complaints for its individual life insurance. However, keep in mind that State Farm’s final expense policies have a maximum death benefit of only $10,000.
How to find the best term life insurance company
There are a few things to consider when finding a life insurance company that you can trust. To start, you can compare companies by their financial stability, customer service, and the types of policies they offer. You can also read reviews from other customers to get an idea of their experience with the company. Another option is to contact the company directly and ask questions about their policies and procedures. By taking the time to do your research, you can find a life insurance company that you can trust to be there for you and your family.
Look up the insurer’s financial strength
When looking at life insurance companies it is important to consider their financial strength rating in order to gauge how likely they are to be around in the future and able to pay claims. You can check the financial strength rating of each term life insurance company you’re considering through a rating firm such as AM Best.
Research the insurer’s reputation for customer service
When considering an insurance company, you should look into their customer service from the beginning of the shopping process until after you make a claim. You can see how other customers feel about the company by looking up their complaint index score on the National Association of Insurance Commissioners website. This score is based on the number of complaints filed against the insurance company with state regulators in relation to the company’s size (based on premiums written). The average score is one, so anything over one means the company got more complaints than expected.
Narrow down your list of life insurance companies to a few, then compare life insurance quotes from each company to get the best rate for the type of term policy you want.
Reasons to consider a term life insurance policy
Term life insurance is a less expensive option for life insurance coverage that is active for a set amount of time, usually 10-30 years. Families that want coverage for a specific period of time may prefer term life insurance. Reasons to research term life insurance as an option include its affordability.
- Low premiums: Term life insurance policy premiums are around five to 10 times cheaper than permanent life insurance policies, on average.
- Expires after a preselected period of time: Term life insurance policies remain in effect for a period of time that the policyholder chooses, usually between 10 and 30 years. Term life insurance may be right for policyholders who only want coverage for a certain period of time, such as when their children are young, or while they’re actively paying a mortgage.
- Option to convert to permanent insurance: If your term life insurance policy expires before you pass away, you’ll stop paying premiums and will not receive a death benefit. However, many of the best life insurance companies offer conversion riders that allow you to convert your term policy to a permanent policy before the term expires.
How to get cheaper life insurance
Life insurance rates depend on your age and health. In general, younger, healthier people pay lower premiums than older people who are at risk. If you want to lower your life insurance rate, these steps may help you save money on your monthly premium.
- Consider purchasing a policy when you’re young. Life insurance generally becomes more expensive as we get older, so it can be beneficial to purchase a policy when you’re young for lower rates.
- Manage the parts of your health that are in your control. This could include healthy habits like eating well-balanced meals, exercising daily and getting enough sleep.
- Cut out smoking and/or other nicotine products. Smoking can trigger long-term health problems, which is why insurers typically have much higher life insurance rates for smokers. Striving to quit can be difficult, but could provide long-term health benefits, along with lower rates.
- Avoid dangerous activities. Risky hobbies like skydiving and rock climbing could increase your life insurance premium significantly. Swapping out a risky activity for safer habits, such as going for long daily walks, could indicate a safer lifestyle to an insurer.
- Reevaluate your coverage level. Once you’ve paid off your mortgage and your kids have moved away from home, you may not need as much life insurance coverage. Reevaluating your coverage and choosing a policy with lower premiums and a lower death benefit may be right for you.
- Evaluate employment benefits. Life insurance provided through employer benefit programs sometimes offers lower rates because they benefit from group pricing. Keep in mind, these policies will typically end if you leave your employer or retire.
Other notable insurance
Haven Life: Best for same-day coverage
Guardian Life: Best for applicants with HIV
AARP: Best for coverage without the medical exam
Fabric: Best for online experience
MassMutual: Best for temporary coverage
New York Life: Best for high coverage amounts
Pacific Life: Best for conversion flexibility
Lincoln Financial: Best for over-the-phone applications
USAA: Best for military personnel
Frequently asked questions
Can I switch life insurance providers to save money?
The most significant factor in your premium will be the policy type and riders you choose, although it is worth comparing rates from one company to another. Your age, health, and other personal lifestyle factors will all play a role in determining your insurance premiums.
Do any life insurance policies provide an investment vehicle?
Do whole life insurance policies include a cash value account that earns gradual interest over time? Yes, however the cash value account is not considered to be an investment vehicle. Whole life insurance policies typically include a cash value account that earns gradual interest over time.
If I live longer than the term of my term life policy, will the insurance company refund part of my premiums?
In general, a life insurance company will not refund your premiums to you once your policy’s term expires. Once the term is up, your premium payments stop, and if you were to die, your beneficiaries would not receive a death benefit. Some life insurance companies do offer riders, though, that will pay back a portion of your premiums (a return of premium rider) or allow you to convert your term life policy to a permanent policy for a fee (a conversion rider).
How do I get affordable life insurance?
One way to get affordable life insurance is to apply when you are young and healthy. Your age and health are factors that play into how much your life insurance rates will be, and these rates do not differ much between providers. Term life insurance is often cheaper than permanent life insurance, so if you want a more affordable policy, term life insurance may be a good place to start.
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