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How to find the best life insurance companies

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Finding the best online life insurance company and policies takes research, digging and patience. There are dozens of options that can fit your specific needs. 

Let’s take a look at the steps you can take to find the best life insurance companies -- offering both term life and whole life -- and some possibilities to explore. 

Shopping for a life insurance policy online can make things easier. You can do it from your couch and even get life insurance quotes online. That said, even if you buy an online life insurance policy, you may still need to get a medical exam. The upside of buying online is its convenience, but you shouldn’t think of it as a way to get a policy without an insurance company knowing about you and your health. 

Similar to any major purchase, the first step to finding online life insurance is to do your homework. Patrick Hicks, head of legal at Trust and Will, said a major problem is not shopping around. Beware of a policy that’s too good to be true. 

Online life insurance companies

You may find a company that will give you a term life policy for less money. Going that route could be a mistake. 

“Choosing the cheapest plan isn’t always the smartest option... Some companies will offer lower rates for term policies, but what you aren’t seeing initially is all the hidden exclusions and costs. It’s better to research trusted companies than to immediately choose the lowest price,” Hicks said. 

Alice Stevens, senior content strategist at Best Company, said many companies allow you to get a quote, apply and buy term life online. 

“Working through these companies will give you access to more accurate quotes and have the potential to offer coverage that starts fast,” Stevens said. 

The biggest issue is making sure you get the right product and coverage amount, said Manny Lirio, assistant vice president of consumer direct marketing at Vantis Life Insurance.

“That is why it is so important to do some upfront work and truly understand what your current and future financial obligations are so you can make sure your family’s financial well-being is protected should you pass away unexpectedly,” Lirio said. 

Another issue is that some online life insurance quotes are only for the healthiest people. For instance, the vast majority of websites will give you quotes for Preferred Plus or Preferred rates, Stevens said. 

These quotes are for people in good or great health. You might not qualify for that rate and will have to pay much more. So, make sure to get a quote for your specific health situation. 

Buying life insurance when you’re not in perfect health makes things more difficult. Matt Schmidt, CEO of Diabetes Life Solutions, said people with chronic illnesses like diabetes can be “misled by fake rates and options.” 

“Those types of underwriting classifications are not usually available for a person with a chronic illness,” Schmidt said. 

Schmidt added that you’ll likely have to provide your health history to get an accurate quote. 

“It's highly recommended they have a phone call, or even an email dialogue with a licensed agent, to fully determine what possible ratings may be extended. They cannot let themselves be tricked into thinking that they'll qualify at these low rates that many websites show consumers. Otherwise, they'll go through the underwriting process, and their actual offer of coverage will be 500% to 1,000% higher than originally quoted,” Schmidt said. 

That said, don’t let a chronic illness prevent you from getting a policy. Stevens said life insurance companies have different underwriting policies. One insurer may underwrite your policy more favorably than others, Stevens said. 

What to think about when buying online life insurance

The first question to ask yourself is: Why do I want a life insurance policy? 

You may want one to:

  • Pay off a mortgage and other debts
  • Fund a child’s college education
  • Provide long-term care for a loved one
  • Cover final expenses, such as funeral and burial costs

The reason that you want a policy will help you choose which  life insurance path to take -- term life or permanent life. The most common type of permanent life policy is whole life

Whole life includes a cash value component. Cash value allows you to tap into your policy later. Whole life is also more expensive and with lower death benefit payouts. However, your loved ones are guaranteed a payout at the end of your life. 

Term life, meanwhile, has lower rates and higher payouts, but you may outlive your policy and your loved ones won’t get anything. 

Which is the best life insurance for you? Lirio offered these suggestions:

Term life

  • People with debt and financial responsibilities like a mortgage and future college costs.
  • Someone who wants the “most death benefit protection at the lowest cost.”

“Term insurance is so affordable because it provides protection for a specific period of time and does not build cash value. If you outlive your policy term, you do not receive any money back,” Lirio said.

Whole life

  • People who want to make sure of a death benefit and don’t mind paying more for that guarantee. 

“Whole life is more expensive than term insurance, but that is because a whole life insurance policy builds cash value tax-deferred that you can borrow from tax-free and provides coverage that will remain in place for your entire life as long as your policy is paid for,” Lirio added.

Find out more about the difference between term life and permanent life. 

Katia Iervasi, life insurance writer for Finder, said when shopping for life insurance online, you’ll want to consider:

  • Premiums
  • Policy features
  • Riders
  • A company’s financial strength and reputation

Riders allow you to customize your policy. Popular riders include waiver of premiums, which lets you skip payments if you’re disabled and unable to work; disability income, which provides money if you become disabled; and term conversion, which lets you change your term policy to a permanent life policy later. 

Riders are a way to customize your policy, but Iervasi warned that guaranteed and online instant-approval policies often don’t allow riders. 

Another issue with no-exam, guaranteed or instant-approval policies is you’ll likely find a cheaper plan through the regular life insurance application process if you’re in good health. 

“Unless you’re a senior or have a preexisting health condition, you might be able to cut costs by going with an insurer that requires a medical exam. Many traditional insurers now have online quoting systems, so take the time to compare rates from both online and traditional companies,” Iervasi said. 

Sara Routhier, financial advisor at Compare Life Insurance, said regardless of what you choose, make sure you sign up with a reputable insurer.

“With over 25 insurance companies in the U.S. having an A or better rating, there is enough competition amongst high-quality companies to get a favorable quote that you don’t have to resort to using a company with a less than stellar reputation. Using a company rated B or lower could mean poor or nonexistent customer service and having to suffer through an arduous claims process,” Routhier said. 

Best term life insurance companies

We’ve talked about how to shop online, what to look for and policy specifics. Now, let’s take a look at possible best term life insurance options for you. 

Here are eight of the best term life insurance companies:

Banner Life

Banner Life, which is part of Legal & General America, provides both term life and permanent life options. Banner Life said it has 1.3 million customers with life policies of more than $734 billion. 

Banner provides term, whole, universal life and final expenses insurance. So, with Banner Life, you’re able to compare multiple types of plans and figure out what is a better match for your needs. 

Banner Life’s term life is available in every state, though New York has term life length restrictions. 

The company offers online quotes, but you can also meet with a local Banner Life agent if you prefer. 

  • Types of life insurance: Term and permanent
  • Length of term life policies: 10 to 40 years
  • 2018 NAIC consumer complaint index: 0.31
  • 2018 share of U.S. market complaints: 0.26
  • Company’s share of premiums in U.S. market: 0.83
  • AM Best financial strength rating: A+

Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints. 

Bestow

Founded in Dallas in 2016, Bestow offers term life policies of two, 10 and 20 years. You can get a policy of between $50,000 and $1 million. 

Bestow is a complete online company and promotes approval “in minutes” and without a medical exam.  However, you’ll need to answer questions about your health, which is called simplified-issue term life insurance. Bestow asks about any major diseases, such as heart disease, cancer and HIV. 

North American Company for Life and Health Insurance issues Bestow policies.

The company doesn’t offer policies in New York. 

  • Types of life insurance: Term life
  • Length of term life policies: 2 to 20 years
  • 2018 NAIC consumer complaint index:  0.81
  • 2018 share of U.S. market complaints: 0.48
  • Company’s share of premiums in U.S. market:  0.66 
  • AM Best financial strength rating: A+

Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints. 

Ethos

Ethos offers 10- to 30-year term life policies for people between 20 and 65 years old. Policies go up to $1 million with no medical exam and $3 million with a medical exam. The process is completely online. 

Policies are guaranteed until the age of 95. The company said it can give you a decision on an application within 10 minutes. 

Ethos offers multiple riders, including critical illness and waiver of premium. 

Ethos doesn’t have policies in New York. Assurity Life Insurance Company underwrites Ethos policies. 

  • Types of life insurance: Term life
  • Length of term life policies: 10 to 30 years
  • 2018 NAIC consumer complaint index: 0.81
  • 2018 share of U.S. market complaints: 0.07
  • Company’s share of premiums in U.S. market:  0.09 
  • AM Best  financial strength rating: A-

NAIC numbers for individual life policies only. 

Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints. 

Fabric

Fabric, founded in 2017, offers term life policies of 10, 15 or 20 years of up to $5 million for people between 25 and 60 years old.

Fabric approves term life policies without a medical exam. It also offers accidental death and dismemberment insurance.

The company doesn’t offer term life policies in most states. Currently, the company offers term life in Colorado, Massachusetts, North Dakota, Pennsylvania, Virginia and Washington. 

Fabric is a nearly completely online company and offers policies without medical exams for many term life policies. 

Vantis Life Insurance issues Fabric policies.

  • Types of life insurance: Term life
  • Length of term life policies: 10 to 20 years
  • 2018 NAIC consumer complaint index: 0
  • 2018 share of U.S. market complaints:  0
  • Company’s share of premiums in U.S. market:  0.2
  • AM Best  financial strength rating: A+

NAIC numbers for individual life policies only. 

Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints. 

Globe Life

Globe Life has term life and whole life policies. Term life policies are up to $100,000 and $50,000 for whole life. Globe Life also has $30,000 whole life policies for children. 

You can get a policy without a medical exam by answering a few medical questions for a simplified-issue policy. These types of policies could be an option if you have health issues, but they usually cost more than regular term life policies. 

Globe Life lets you keep your term life policy until the age of 90. However, your rates increase every five years. This feature is based on your risk. As you age, you become a greater risk. Hence, the higher rates. 

Founded in 1951, Globe Life said it has 4.2 million policyholders.

  • Types of life insurance: Term life, whole life
  • Length of term life policies: Flexible
  • 2018 NAIC consumer complaint index: 8.33
  • 2018 share of U.S. market complaints: 2.83
  • Company’s share of premiums in U.S. market:  0.34 
  • AM Best financial strength rating: A+

NAIC numbers for individual life policies only. 

Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints. 

Haven Life

Haven Life offers term life policies between 10 and 30 years. There are no permanent or whole life policy offerings. 

MassMutual issues Haven Life policies. Most policies don’t require a medical exam. 

Term life policies are available up to the age of 64 for up to $3 million. Haven Life offers accelerated death benefits for no added cost. That rider lets you tap into the life insurance benefit while you’re still alive if you’re diagnosed with a terminal illness. Money taken from the policy reduces the death benefit your survivors receive when you die. 

Haven Life is an online company, so there aren’t face-to-face agents. 

  • Types of life insurance: Term life
  • Length of term life policies: 10 to 30 years
  • 2018 NAIC consumer complaint index:  0.12
  • 2018 share of U.S. market complaints: 0.55
  • Company’s share of premiums in U.S. market:  4.57
  • AM Best financial strength rating: A++

Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints. 

Ladder

Founded in 2017, Ladder provides policy flexibility. You’re able to change the amount of your term life policy. So, for instance, if you pay off your mortgage and don’t need as much term life coverage, you can decrease the amount and payments. 

Options vary by 10-year to 30-year term periods for 20 to 60-year-olds. Policies are up to $8 million. 

Ladder said applicants can receive an “instant decision.” However, the company doesn’t offer riders, so you can’t customize your policy. 

The company doesn’t offer policies in New York. 

Fidelity Security issues Ladder policies.  

  • Types of life insurance: Term life
  • Length of term life policies: 10 to 30 years
  • 2018 NAIC consumer complaint index: 12.72
  • 2018 share of U.S. market complaints: 0.11
  • Company’s share of premiums in U.S. market:  0.01
  • AM Best financial strength rating: A+

NAIC numbers for Fidelity Security. 

Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints. 

Protective Life

Protective Life gives term policies between 10 and 30 years, as well as other types of policies, including whole life, universal life and variable universal life. 

Term life coverage is between $100,000 and $50 million. You’re able to convert term life policies to a permanent life policy without a medical exam. 

Costco members save 15% on average for Protective Life policies. The Better Business Bureau gives Protective Life an A+ rating.

  • Types of life insurance: Term life, whole life, universal life, variable universal life
  • Length of term life policies: 10 to 20 years
  • 2018 NAIC consumer complaint index: 0.54
  • 2018 share of U.S. market complaints: 0.7
  • Company’s share of premiums in U.S. market: 1.3
  • AM Best financial strength rating: A+

Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints. 

Best whole life insurance companies

Life insurance companies also offer online whole life insurance policies, though they’re not as plentiful as term life policies. 

Here are some of the best whole life insurance companies that may offer whole life insurance quotes: 

AAA

AAA said that it has sold 1.4 million policies and paid out $3 billion in claims in 50 years. 

This guaranteed whole life insurance has coverage of up to $25,000. It's meant to cover final expenses and has no expiration. Premiums are the same every month until you turn 100 when there is no fee for the premium.

Because it is a guaranteed-acceptance policy for folks between 45 and 85, there are no medical questions or exams. You don’t need to belong to AAA to buy a policy, but non-members have to pay a $60 per year fee.

One policy add-on is your loved ones will receive double benefits if you die from a covered travel accident.

  • Types of life insurance: Term life, universal life and whole life
  • 2018 NAIC consumer complaint index: 0.62
  • 2018 share of U.S. market complaints: 0.04
  • Company's share of premiums in U.S. market: .06
  • AM Best financial strength rating: A-

    Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints.

    Farmers insurance

    Farmers offers an automated underwriting system that includes medical questions. Depending on the answers, you may or may not need to take a medical exam. 

    Farmers provides whole life insurance to those aged 15 days to 80 years old with claims paid to 121 years old.

    It also offers a graded whole life insurance product. Those who are not in perfect health can get this policy by answering three questions about their health. Ages for this policy are 18 to 80. And the policies can go up to $30,000

    • Types of life insurance: Term life, universal life and whole life
    • 2018 NAIC consumer complaint index: 0.28
    • 2018 share of U.S. market complaints: 0.02
    • Company's share of premiums in U.S. market: .07
    • AM Best financial strength rating: A

      Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints.

      Guardian

      Guardian life insurance offers flexibility when choosing whole life insurance. It provides both traditional and universal whole life insurance.

      Traditional policies have payments that remain the same over the policy’s life. With universal whole life, Guardian lets you adjust the premium payment amounts based on what's going on in your life, while still building cash value on the policy.

      Also a mutual company, Guardian was founded in 1865 and serves 27 million customers a year.

      • Types of life insurance: Term life, universal life and whole life
      • 2018 NAIC consumer complaint index: 0.084
      • 2018 share of U.S. market complaints: 0.0
      • Company's share of premiums in U.S. market: .04
      • AM Best financial strength rating: A++

        Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints.

        Mutual of Omaha

        Founded in 1909, Mutual of Omaha offers whole life insurance for children as well as adults. Mutual of Omaha guarantees whole life insurance for those 45 to 85 years old (50 to 75 in New York).

        With an online application and no medical evaluation required, policyholders can be approved for $2,000-$25,000. That amount can go up to $40,000 if the applicant works with an advisor to complete an advanced application. The advanced application involves medical questions, but no exam.

        • Types of life insurance: Term life, universal life, accidental death and whole life
        • 2018 NAIC consumer complaint index: 0.56
        • 2018 share of U.S. market complaints: 0.09
        • Company's share of premiums in U.S. market: .17
        • AM Best financial strength rating: A+

          Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints.

          Northwestern Mutual

          Being a mutual company, Northwestern Mutual is essentially owned by its policyholders. That means, when times are good, dividends are paid out. Northwestern Mutual expects to pay $6 billion in dividends in 2020.

          Based in Milwaukee, WI, Northwestern Mutual employees nearly 6,500 advisors. Its process to get started is pretty self-explanatory. With a few clicks on its website, you know what it will cost you for the coverage you need.

          Northwestern Mutual says that 96% of its policyholders stay with them year over year.

          • Types of life insurance: Term life, universal life and whole life
          • 2018 NAIC consumer complaint index: 0.02
          • 2018 share of U.S. market complaints: 0.02
          • Company's share of premiums in U.S. market: .87
          • AM Best financial strength rating: A++

            Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints.

            Penn Mutual

            With $28 billion in assets under management and $1.7 billion paid to policyholders or beneficiaries last year, Penn Mutual is rated at the top of its class in the four major ratings agencies.

            Founded in 1847, Penn Mutual has advisers across the country. If you're not near one of the offices, you can call the main number and be routed to someone who can help you. Once you have an account with them, everything can be managed online, including filing claims.

            • Types of life insurance: Term life, universal life, variable universal life, whole life and survivable life
            • 2018 NAIC consumer complaint index: 0.08
            • 2018 share of U.S. market complaints: 0.18
            • Company's share of premiums in U.S. market: 1.02
            • AM Best financial strength rating: A+

              Note: The National Association of Insurance Commissioners (NAIC) collects complaint ratios to state insurance departments. A median score is 1. Companies lower than 1 have fewer complaints than the median company. Companies over 1 have more complaints.

              -- Susan Manning contributed to this report.