Best Life Insurance of 2018

Eli McCormick ·
Finance Senior Writer
Updated
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Recently, we spent 40 hours getting life insurance quotes and speaking to industry experts. We got quotes for a variety of policies for a male and a female at different stages in life. Every policy is different, but our quotes cover common scenarios and give a good idea of what you can expect to pay. After comparing costs, plan options and beneficiary assistance, we chose Northwestern Mutual as the best life insurance company overall. Its prices compare well against those at other insurers, and people with less-than-excellent health may find better prices there than at other companies. It also offers a variety of policies and has a long record of financial health.

Best Overall
Northwestern Mutual
Northwestern Mutual has excellent policies, especially for smokers and those with less-than-excellent health. It offers a wide range of policy options as well as other financial planning services.
View on Northwestern Mutual
Best Value
AIG
AIG quoted us the lowest rates for both term and permanent life insurance policies, making it the best option if cost is your main concern.
View on AIG
Best Permanent Policies
MassMutual
MassMutual offers a variety of permanent policy options and has a long history of providing dividends to policy holders.
View on MassMutual
Product
Price
Overall Rating
Example Premiums
Plan Options
Beneficiary Assistance
Male, 45, Smoker Term
Male, 45, Smoker Permanent
Female, 33, Non-Smoker Term
Female, 33, Non-Smoker Permanent
Whole
Universal
Disability Insurance
Financial Planning
Online Claims Filing
One-on-one Claims Assistance
Check Price
8.8 8.8 10 7.3
$101
$622
$20
$239
-
AIG
Check Price
8.6 10 10 2.8
$114
$398
$13
$157
-
-
Check Price
8.4 8 10 7.3
$174
$571
$17
$213
-
Check Price
8.4 9.3 8.8 5.8
$122
$424
$20
$127
-
-
Check Price
8.3 7.8 10 7.3
$158
$570
$22
$233
-
Check Price
8.1 8 7 10
$154
$425
$28
$113
-
Check Price
8.1 8 8.8 7.3
$148
$534
$24
$189
-
-
Check Price
7.8 8.5 10 2.8
$130
$529
$19
$234
-
-
Check Price
7 7.8 5.8 7.3
$155
$228
$21
No quote yet
-
-
-
Check Price
6.3 8 5.8 2.8
$181
$581
$18
$165
-
-
-
-
Best Overall
Northwestern Mutual has been issuing life insurance policies since the 1800s and has a long record of financial stability, earning an A++ rating from A.M. Best.
We chose Northwestern as the best life insurance company because of its many plan options and good rates. To find out how much a policy costs, we contacted Northwestern and had a local agent run us through the quote process. We got quotes for a 45-year-old male who smokes and a 33-year-old female who doesn’t. To eliminate some variables, we used the same income, savings and retirement numbers for each quote. Our smoker scenario came in at $101 a month for a $250,000, 20-year term policy. This is the lowest price we saw for this scenario. In fact, this Northwestern Mutual policy was $40 less than the average policy we were quoted for the male smoker. Health is a big factor in determining how much your policy costs, and smokers have higher rates. The quote we got for our 33-year-old woman was around $20 a month for a $250,000, 20-year term policy. This is about average, so while you may find a cheaper policy elsewhere, you’ll still get a good rate through Northwestern. The costs for a permanent policy were much higher. For a similar face value of $250,000, you can expect to pay a few hundred dollars more per month than the average. As a mutually owned company, permanent policies pay out dividends annually, and Northwestern has paid annually for over a hundred years.
Pros
  • Good rates for smokers
  • Offers disability income insurance
Cons
  • Expensive whole-life policies
  • Can’t file claims online
Check PriceNorthwestern Mutual
Read the full review
Best Value
Life insurance policies can be quite expensive, and after getting and comparing quotes, we found that AIG offers the lowest prices, making it our pick for the best value.
If you want a term policy to provide security for your family in case you die, finding a low-cost option is a good call. It’s especially important you purchase a policy from a company on sound financial footing like AIG, which has an A rating from A.M. Best. To compare life insurance companies, we got quotes using a 45-year-old male smoker and a 33-year-old female non-smoker as examples. We used the same income, debt and savings amounts to control other variables. AIG gave us the lowest quotes for term and permanent policies, with one exception. AIG’s quote for the 45-year-old’s term policy was only second lowest, although still $30 less than average. We got the lowest quote for a permanent policy from AIG – at about $398, it was nearly $100 below average. As such, it may be a good choice if you’re cost conscious but want to take advantage of the wealth-building benefits of permanent life insurance. Our healthy 33-year-old got a term quote of $13 a month, which is about $7 lower than the average. Our quoted rate for a permanent policy was $157, about $30 below average. These costs can vary depending on where you live, your health and the amount of insurance you choose to buy.
Pros
  • Term plans as low as $13 a month
  • Smokers and other high-risk people can get good rates
Cons
  • Doesn’t have financial planning services
  • Can’t file claims online
Check PriceAIG
Read the full review
Best Permanent Policies
A life insurance policy can do more than provide money for your family in the event of your passing. Permanent life insurance policies can build wealth, and MassMutual has some of the best permanent policy options we saw.
Because they build value over time, permanent policies are more expensive than term life insurance, and MassMutual’s offerings are no exception. Your policy’s price depends a lot on your age and health. We got quotes for a 45-year-old male smoker and a healthy 33-year-old female non-smoker. The smoker’s permanent policy cost about $100 above the average for the life insurance companies we reviewed, while the non-smoker’s policy was only $30 above average. So, if you smoke or have other health complications, you may want to explore other options. MassMutual offers whole and universal life insurance options, both of which are different types of permanent life insurance. Universal life insurance policies have flexible premiums, and you can borrow some of the money the policy accrues. Both whole and universal policies earn dividends. MassMutual has consistently issued dividends since the late 1800s. In 2018, its dividend interest rate was 6.40 percent, which compares favorably with the highest yielding permanent life insurance policies.
Pros
  • Multiple permanent policy options
  • High dividend percentages
Cons
  • Health affects premium costs more than at other insurers
  • Term policies are more expensive than average
Check PriceMassMutual
Read the full review
Best Policies for Women
When we compared policy premiums, we found that Nationwide offered the best rates for women, especially for permanent policies.
Our quote for a 20-year term policy worth $250,000 came in at $20 a month, which is about average. In addition, Nationwide quoted us one of the lowest prices for a $250,000 permanent policy – $127 per month. The company is rated A+ by A.M. Best, an organization that evaluates life insurance companies. This rating means Nationwide has the stability to pay out claims in the future. As with all life insurance policies, age, value and health do a lot to determine how much you pay in premiums. If you’re looking for other financial planning services, you may want to use another company – Nationwide doesn’t offer them.
Pros
  • Low rates for women, especially for permanent policies
Cons
  • No financial planning services
Nationwide
Read the full review
Best for Financial Planning
If you want to plan for your future beyond just a life insurance policy, Guardian is one of the best companies to work with.
In addition to life insurance, it offers investment advice, IRAs and annuities. Through its subsidiary Park Avenue Securities, you can invest in stocks and mutual funds. Guardian is rated A++ by A.M. Best, meaning it’s financially stable and can pay out claims. The company’s main drawback is it was one of the more expensive life insurance companies we reviewed. Premiums for both its term and permanent policies were more expensive than average.
Pros
  • Offers many additional financial services
Cons
  • Life insurance policies tend to be more expensive
Guardian Life
Read the full review

Why Trust Us 

At Top Ten Reviews, we’ve been writing about life insurance for nine years. To ensure we include the best companies, we look for insurers with ratings of A or above from A.M. Best, an organization that grades companies on their financial health. Because life insurance has such a far-off horizon, you want to work with a company that can pay claims in 20 years. You should avoid any insurer with a grade below a B. You can find companies’ life insurance ratings on A.M. Best’s website.

Because there are so many life insurance companies, we couldn’t possibly include every insurer. We looked at those with a relatively high market share and name recognition. We also excluded companies that operate as brokers – for example, companies like GEICO and Progressive who don’t offer their own life insurance policies and instead connect you with a third party. If you do use a broker, check its rating and consult your state insurance commission to see if any complaints have been made about the agent.

How We Tested

Price is probably the biggest consideration when choosing a life insurance policy. There’s no one-size-fits-all solution – your policy is customized to you specifically. Insurers factor in your health, your financial situation and what your beneficiaries will need in the event of your passing. To provide some idea of what you can expect to pay, we got quotes from each of the insurers we reviewed. 

One quote was for a 45-year-old man who smokes and is in good, but not excellent, health. Our male subject was married with a 12-year-old child. Our other quote was for a 33-year-old woman in excellent health with a 2-year-old child. To have some measure of uniformity, both our hypotheticals had similar financial situations. 

We got quotes for a 20-year term policy and a permanent insurance policy. We’ll explain the difference below, but briefly, a term policy provides a single benefit for a set number of years, while a permanent policy lasts indefinitely and includes an investment portion that builds value over time. Permanent policies tend to have much higher premiums than term policies.

Because these policies are customized and complex, you can expect to spend close to a half hour on the phone answering questions about your health and income. Some insurers, like New York Life, prefer face-to-face meetings, so we couldn’t include them.

How Much Does Life Insurance Cost?

This question is always followed by another: How much coverage do you need? The amount of coverage you need determines how much you pay in monthly premiums. For example, a $250,000 term life insurance policy can cost close to five times less than a $1,000,000 policy. Your premium also depends on your gender, age and health. A healthy woman can expect to pay around $20 a month for a $250,000 policy, while a healthy man can expect to pay around $25 a month. Whole life policies, which include a savings account that builds value, are more expensive and cost between $100 and $500 a month.
How to choose a life insurance policy

Life insurance is a grim subject – no one wants to think about dying, much less how their family will be provided for when they’re gone. But when you get a life insurance policy, your family will continue to receive an income as well as have money to pay for funeral expenses and your children’s future educational expenses.

How much do you need?
According to the American Council of Life Insurers, most experts recommend getting a policy that pays between seven and 10 times your annual income. Depending on your age, income, savings and other factors, you may need more or less. There are many online calculators that can help you figure out how much you need in insurance as well as how many years your policy should last. 

Generally, the older you are, the more likely it is a shorter policy will be useful. If you have enough savings, a good retirement plan and low debt, a lower limit policy is a good option. When you call for a quote, the agent will ask you questions about your financial situation, health and plans for beneficiaries before making recommendations.

What type of policy should you get?
There are two main types of life insurance policies: term and permanent. A term policy is the most common and most affordable. It covers you for a certain amount, called the face value or death benefit, for a set period of time. A $250,000 policy with a 20-year term will pay your beneficiaries $250,000 if you die at any time during the 20 years the policy lasts.

A permanent policy doesn’t expire and instead lasts for as long as you pay the premium. A permanent policy is guaranteed to pay out the claim. It’s not an if – it’s a when. In addition to the death benefit, a permanent policy has a living benefit that builds value each year. A portion of your premium is put toward building the value of the living benefit. A permanent policy is much more expensive than a term policy, often costing up to 10 times as much.

A good way to think about the differences between term and permanent life insurance is to compare it to renting versus owning a home. Renting can be cheaper, but it’s temporary and doesn’t build any value. Owning a home is more expensive, but you build equity and long-term value.