What Is Life Insurance?
Life insurance is a kind of insurance that pays to your beneficiary of choice upon your death. You select an insurance provider which offers the type of policy and death benefits you would like to apply for and, if accepted, the company will promise to transfer the agreed amount to the beneficiary (this could be a family member or a loved one, or even an institution) at the time of your death if you pay the premiums required.
The purchase of a life insurance plan will provide financial security for your beloved ones; however, choosing the best policy could be confusing. There are a variety of approaches to life from which to choose. Certain types, such as term life insurance, run for a specified time. Other policies, such as perpetual life insurance, will provide protection that lasts for a lifetime and can also offer more savings or investment options.
A life insurance plan can give you peace of heart when you’re the primary caregiver for your family members and you’re worried about their financial future if you pass away or pass away.
Life insurance is a great way to assist your family with funeral expenses, educational expenses for children’s income loss, or other financial requirements.
Finding the right life insurance company weighs data on customer service, customer experiences, and the insurer’s financial quality. To assist you in evaluating your choices, NerdWallet scores companies based on these aspects. Take a look at the top companies in life insurance in 2022.
Below is our list of the top life insurance companies in April 2022. We’ve highlighted their differences, the various policies, and the rates they charge.
The Best Life Insurance Companies for 2022
1. Best Term Life Insurance: Haven Life
We picked it: Haven Life provides a vast range of term life insurance choices that include plans that offer the highest death benefit. The plans also include extra benefits, such as online tools to make the will.
PROS
- offers two kinds of term policies, including Simple Issue and Haven Terms
- Haven Simplified Issue doesn’t require a medical exam
- up to $3 million for term coverage
- Haven Term is comprised of Haven Plus with perks and discounts
CONS
- Medical tests are required for more than $500,000 of coverage
- Simplified issue policies are not accessible in CA, DE, SD, ND, or NY
- Haven Plus is not available in FL, NY, ND, SD, and WA
- Policies can’t substitute for another Life Insurance policy
Haven Life is awarded our vote as the best term insurance policy due to its extensive range (10- 15-, 20-, 10-25- and 30-year) of policies and the coverage amount ranging between $100,000 and $3 million.
Haven Life offers two life insurance policies for the term: Haven Term and Haven Simple. Haven Term comes with Haven Life Plus, a rider that can access an online platform to create an estate plan or trust, fitness and sleep tracking applications, and an online vault to store important documents.
Haven Simple is only available to applicants between the ages of 20 and 55. Applicants less than 64 are eligible for $3 million coverage with Haven Term. It also comes with the rider Accelerated Death Benefit.
2. Best No-Exam Life Insurance: Bestow
We selected the format Bestow offers term life insurance more rapidly and effortlessly than many companies and provides a unique death benefit on policies that don’t need a medical exam.
PROS
- HD protection (up to $1.5 Million) without medical examination
- Application online and speedy processing
- Terms span between 10 and 30 years
- Long (30-day) free look period
CONS
- No riders available
- Offers only one kind of life insurance, namely term insurance
- must be under 60 to be eligible for coverage
- Policies are not available for residents in New York
Bestow is an excellent option for those who wish to purchase life insurance but do not want the hassle of having a medical examination. The company offers a policy based on a term (and only policies that cover term insurance) which means applicants can submit an application online and buy an insurance policy without going to a physician or getting tests like bloodwork. You can receive a maximum of $1.5 million in coverage higher than other no-exam insurance policies.
The company analyzes your data and responses to questions about your background, health, hobbies, and other activities to determine your coverage for life insurance and the cost. Bestow says you can obtain an estimate and buy an insurance policy in just a few minutes, all on the internet.
Bestow policies are offered by the top-rated insurer North American Company for Life and Health Insurance. Furthermore, Life assurance from Bestow is now integrated into the Lemonade app and website. Bestow also has a vast database of details.
3. Best for Guaranteed Coverage: Ethos
We chose Ethos because Ethos stands out as an insurance company capable of offering a variety of potential customers and those who have had difficulty obtaining insurance previously – like older people. In addition, potential customers can get a quote in minutes without speaking with an insurance broker.
PROS
- Offers term and long-term coverage
- Policies on Guaranteed Issues are available
- Quotes and the application process are completely online
- Death benefit riders that accelerate death benefits are is available on the majority of policies
CONS
- Very little information is publicly available on additional riders
- Limited permanent life insurance options
Ethos provides three kinds of underwriting options:
- Simple issue guidelines oblige you to answer your health and medical history questions. However, medical tests are not required.
- Guaranteed issue: You can’t be denied due to your medical background or health through the guarantee of issue policy.
- Completely underwritten Policies that are fully backed need medical exams and blood tests.
Ethos utilizes either a simplified issue or fully underwritten methodologies for its term policies and guarantees issue underwriting for all of its Life Insurance policies (no firm we have heard of has term policies that come that guarantee insurance coverage).
The guaranteed issue life insurance policy is offered for those between 65 to 85. The approach allows applicants to get an instant approval for up to $25,000 in insurance, regardless of medical background.
Most have an enhanced death benefit rider, allowing policyholders to access some of their benefits when diagnosed with a terminal illness.
4. Best Online Broker: Policygenius
We picked it. It is a full-service online marketplace for life insurance; Policygenius offers one-stop access to both whole and term life insurance from many partners, including some of our top life insurance firms. Contrary to other comparison websites that claim to be secure, this one promises not to market your information to any third party.
PROS
- It is quick and easy to find quotes from several insurance providers
- Agents aren’t paid a commission, according to the company.
- Different types of insurance are available.
CONS
- All providers don’t offer online quotes.
- takes longer than other options to determine the final price
Policygenius ranks first as the most effective comparison tool and broker due to its satisfactory one-stop shopping service across various insurers. The Policygenius partners include AIG, Banner Life, Brighthouse, John Hancock, Lincoln Financial, Mutual of Omaha, Pacific Life, Principal, Protective, Prudential, SBLI, and Transamerica.
This marketplace on the internet also provides a vast library of educational materials for those who are just beginning to learn about life insurance and includes guidelines for life insurance policies for those with depression or diabetes. Along with the wide range of options for coverage, including temporary or permanent coverage, These resources make Policygenius an outstanding choice for comparing quotes on life insurance.
If you require assistance in choosing the appropriate insurance policy or coverage amount, PolicyGenius’ agents can provide individualized service. According to the company, they’re paid by the hour rather than commissions. They, therefore, aren’t enticed to sell more products or direct you to specific products that could result in a higher percentage of commission.
5. Best for Flexible Coverage: Ladder
We chose this because Ladder’s appeal lies in its flexibility, true to its name. When your needs alter, you can reduce or increase your protection. The cost of premiums starts at just $5 per month*, meaning you can get an insurance policy even in a financial pinch.
PROS
- Coverage for a term can be modified in time
- from $100,000 to $8 million in terms of coverage is available
- 30 days free-look period instead of the standard 10-day timeframe
- No medical examinations up to $3 million in coverage
CONS
- Plans are restricted to individuals between the ages of 20 and 60
- Only term coverage is offered
- No optional riders
Even though it writes only term insurance for young applicants, Ladder is the best flexible insurance choice. It’s an online application that requires only three steps and provides affordable insurance plans that start at just $5 per month. The company doesn’t charge cancellation fees, and you can end your insurance at any time, without conditions attached.
Another appealing feature of Ladder differs from other insurance companies; it allows policyholders to alter their coverage online anytime they want and with the accompanying increases in rates. This benefit can help policyholders keep their policy affordable throughout the year and could be particularly appealing for those concerned about the future financial situation changes.
Based on a twenty-year female who is rated Preferred-Plus and has 100k in a policy with a term of 10 years.
6. Best for Customer Satisfaction and Stability: State Farm
We chose State Farm because of Why we chose it: If providing a positive customer experience is crucial to your needs, State Farm should be an ideal choice. State Farm has a stellar reputation for customer service, with a stellar track record of financial stability.
PROS
- Awarded the top spot for a company that provides satisfaction to customers
- A low number of customers complaints
- Multiple options for policy
- Simplified-issue (no exam) policies are available
CONS
- Quotes online are not available for all options of insurance
- Most policies require medical exams
- There are no discounts if you bundle it with auto or homeowners insurance
State Farm is a leading insurance provider and is our top choice for an insurance provider in terms of customer satisfaction and trustworthiness. In 2021, it was recognized by J.D. Power as the best life insurance company, based on consumers’ responses. It topped the other 21 life insurers in terms of its offerings in terms of products, communication prices, and customer interaction.
The company is awarded an A+ (superior) score by AM Best — the most prestigious rating obtained, which means that it’s financially sound. Additionally, State Farm received fewer complaints than expected from the company’s size.
State Farm sells term, universal, and whole Life insurance plans. While most of its policies require medical tests, there are some simpler-issue plans.
7. BEST FOR FINANCIAL STABILITY: MassMutual
Why We Chose It
MassMutual is notable for many reasons. Most notable is its A+ score from AM Best. This is the highest grade an organization can get and signifies a “superior” capacity to pay claims.2 The company’s history of paying dividends helps boost its standing each calendar year. Since the beginning of 1869, eligible policyholders were paid life insurance payouts. In addition, it has had shallow complaints, as measured by the NAIC complaint index in the last three years.
Pros
- Graded A+ in financial stability
- Long-standing history of dividend-paying
- Very very few complaints
- Liberal term conversion options
Cons
- A few benefit riders that are accelerated are offered without cost
- Doesn’t accept credit card payments
It is important to note that policyholders of MassMutual term policies can change to any of the MassMutual’s permanent policies. This is essential because some firms limit the kinds of policies that you can change your term policy to. (Convertible term insurance permits the exchange of a portion of the full-term insurance for a permanent one without applying for life insurance again. )
However, unlike other competitors, this company does not provide many benefit riders that are accelerated that are free with most of its policies. Additionally, it does not accept credit card transactions.
Types of Life Insurance Policies
There are two kinds of life insurance policies: term and permanent. The most common permanent insurance policies include general and entire life. Learn more about the different types.
What Is Term Life Insurance?
A term life insurance plan is a temporary form of life insurance. An insurance term can be defined by the time it is in force or the length of its duration. A period may be shorter than a year, or it could last for thirty years. These policies could also allow conversion into a life insurance policy or being renewed for a different time.
What Is Permanent Life Insurance?
A permanent life insurance policy is intended to be an insurance policy to cover the long term. The policies typically have two elements: the death benefit and an amount of cash. The cash value may function as a savings component or investment, contingent on the particular policy. Examples of permanent life insurance include universal and whole life insurance policies.
What Is Whole Life Insurance?
A life insurance policy that is whole is a kind of life insurance that comes with the death benefit and cash value. The cash value can increase depending on whether the company you purchase insurance from distributes dividends. Bonuses may be contingent on the performance of the financials of the company. Insurance policies for mutual life and the policies sold by stock insurance companies typically contain dividend options.
For more information, could you read our complete life insurance guide?
What Is Universal Life Insurance?
Universal Life Insurance is a different illustration of permanent life insurance. One of the main differences between universal and whole life insurance is its flexibility. You can adjust your premiums and the death benefit with most universal policies as long as the policy is in force. Different universal life insurance policies include universal index life (IUL), VUL, variable universal life (VUL), and guaranteed universal life insurance.
For more information, read our universal life insurance guide.
What Is No-Exam Life Insurance?
No-exam life insurance is a kind of insurance that doesn’t require you to take a medical test before applying. They can be permanent or term policies. The process of approval for these policies is usually quick because you do not have to make an appointment or undergo a medical examination in the process of applying.
While some companies will let medical tests be waived for certain applicants, however, a no-exam rule doesn’t make anyone take an exam for medical reasons.
How Much Does a Life Insurance Policy Cost?
The price of an insurance policy for life can vary greatly, even within policies that cover people of the same age group. The factors determining the cost of premiums for life insurance policies include the life insurance company’s age, gender, health, and the policy’s additions (also known as riders). ).
Suppose you only look at the sex of a person. In that case, the difference in price for a woman aged 35 and a male in the Standard Risk class, with a $1,000,000 20-year life insurance plan of Banner Life, is just over 15 dollars per month. If you take these two individuals and the same insurance and compare it with New York Life, the difference is nearly 50 dollars per month.
Age is another aspect. There is a difference between a 35-year old female who is in the Standard Risk Class as well as the same in the Standard Risk Class and risk class when she is 65 years old, with an insurance policy with a term of 20 years and $1,000,000 with Haven Life is almost $975 per month.
Last thoughts
If you’re looking for an insurance provider for life, it’s hard to make a mistake with any companies listed. However, if you’re unsure what kind of policy you’re looking for, begin with Nationwide. It provides the broadest range of policy options. Nationwide is also a great choice if looking for the most comprehensive no-exam coverage and Guardian.
