Life Insurance
Looking for affordable life insurance? Look no further than term life insurance - it's the most popular form of life insurance for a reason. However, with so many companies offering term life insurance, it can be overwhelming to choose the best policy and provider. That's where MoneyGeek comes in - we've done the hard work for you.
Our team has analysized the top term life insurance companies to help you find the best policy online, regardless of your age or whether you require coverage without a medical exam. With our comprehensive comparisons, you can easily find the best term life insurance policy to suit your unique needs.
TABLE OF CONTENTS
— What Is Term Life Insurance?
— Best Overall Company
— Best Online Company
— Company With Best Rates
— Best Company With Superior Customer Service
— Best Company for Seniors
— Best Company for Young Adults
— Best Company for Return on Premium
— Best Company with No Medical Exam
— Real Term Life Quotes from the Top Companies
— How to Choose the Best Term Life Insurance Policy for You
— How Much Term Life Insurance Do You Need?
— What Happens if You Live Beyond Your Life Insurance Term Period?
— Methodology
What Is Term Life Insurance?
Term life insurance is a type of life insurance policy that provides coverage for a specified period or "term." Typically, the policyholder pays a fixed premium throughout the term, and if they pass away during that period, the insurance company pays out a death benefit to their beneficiaries.
Term life insurance policies can be purchased for terms ranging from one to thirty years, depending on the individual's needs. Once the term expires, the policy can be renewed, but the premiums may increase as the policyholder ages. Alternatively, the policyholder can choose to convert the policy to a permanent life insurance policy, which provides coverage for the policyholder's entire lifetime.
Overall, term life insurance is a cost-effective way to provide financial protection for loved ones in the event of an unexpected death. The amount of coverage needed and the length of the term depend on the individual's unique circumstances, such as their age, health, and financial obligations. By opting for term life insurance, individuals can have peace of mind knowing their loved ones will be financially protected during a specified period.
Term vs Whole Life: What's The Difference?
If you're weighing the options between term and whole life insurance, it's essential to understand the key differences between these two types of policies.
When it comes to choosing between term and whole life insurance, it's essential to understand the differences between these two types of policies. Term life insurance offers coverage for a specified period, usually ranging from one to thirty years, and typically has lower premiums than whole life insurance. If the policyholder dies within the term, the insurance company pays out a death benefit to the beneficiaries. If the policyholder outlives the term, the policy expires unless it is renewed.
On the other hand, whole life insurance provides coverage for the policyholder's entire lifetime and typically has higher premiums than term life insurance. These premiums are level and remain the same throughout the policyholder's life. Unlike term life insurance, whole life insurance also offers a cash value savings component, which can grow over time and be accessed by the policyholder during their lifetime.
The key differences between term and whole life insurance are the cost of premiums, the length of coverage, and the availability of cash value savings. While term life insurance may be the more cost-effective option for some individuals, whole life insurance may be a better choice for those seeking lifelong coverage and the added benefit of cash value savings. Ultimately, the right type of life insurance will depend on an individual's unique circumstances, such as their age, financial goals, and overall health.
Best Overall Term Life Insurance Company: Mutual of Omaha
pros
Unique, free riders included with Term Life Express
Competitive pricing
Return of premium feature on select term policies
cons
Maximum $300k in coverage for Term Life Express
Only term policies under $1 million can be quoted online
COMPANY HIGHLIGHTS
MoneyGeek Score: 90.8
J.D. Power (out of 1,000): 783.4
AM Best Rating: A+
NAIC Complaint Index: 1.20
Mutual of Omaha is MoneyGeek's top pick for term life insurance due to its high satisfaction scores, wide range of coverage options, available riders, and competitive pricing. They offer two policy types: Term Life Answers, a fully underwritten term life insurance policy with a choice of 10-30 years coverage and $100,000-$5 million or more in face amounts, and Term Life Express, which offers term life insurance without a medical exam, starting at $25,000 up to $300,000, but includes free riders like living benefits, unemployment waiver of premium, and common carrier death benefit. The 20- or 30-year Term Life Express with a return of premium option may be suitable for those who want their premiums returned at the end of the term.
Best Online Term Life Insurance Company: Haven Life
pros
Easy online quote and application process
Many approved for term life insurance with no medical exam
Credit cards accepted on Haven Simple
cons
Doesn't provide coverage in CA, DE, SD, ND or NY
Coverage without a medical exam limited to $500,000
COMPANY HIGHLIGHTS
MoneyGeek Score: N/A
J.D. Power (out of 1,000): N/A
AM Best Rating: A++
NAIC Complaint Index: N/A
MoneyGeek picked Haven Life as the top online term life insurance company for its digital application process, pricing, and underwriting rules. Haven Life exclusively offers term life insurance with two options. Haven Term offers medically underwritten policies, which require a medical exam, with coverage between $100,000 and $3 million for people up to 64 years old. The available term lengths range between 10 and 30 years. Haven Simple, a simplified issue term life insurance policy with no medical exam, offers coverage between $25,000 and $500,000 for people between 20 and 55 years old. Term options are available for five, ten, fifteen, and twenty years. Both policies come with level premiums for the life of the policy and a free accelerated death benefit rider, which allows tax-free access to 75% of the death benefit if the policyholder is diagnosed with a terminal illness. Haven Life's "waiver of premium for disability" rider is available in select states for applicants under 50.
Best for Product Diversity at Competitive Rates: Nationwide
pros
Online quotes available
Several term lengths and riders to choose from
Choose your payment frequency
cons
Most require medical exams
COMPANY HIGHLIGHTS
MoneyGeek Score: 88.6
J.D. Power (out of 1,000): 785.5
AM Best Rating: A+
NAIC Complaint Index: 0.10
Nationwide is a top provider of term life insurance policies. Its Guaranteed Level Term life insurance offers flexibility in terms of coverage length and rider options, and has competitive rates across various health classes. Policies are available in 10-, 15-, 20- and 30-year terms, with coverage starting at $100,000 and the ability to annually renew the policy until age 95.
Nationwide's term life insurance policies can be tailored with riders. For example, a living benefit rider can provide access to the death benefit if you are diagnosed with a severe illness. Riders for chronic, critical and terminal illnesses are also available. Parents can add a children's term insurance rider to provide coverage for their children, adopted children or stepchildren. If you become disabled, you may be eligible for the premium waiver rider, which waives your premiums after six months.
The minimum age for term coverage is 18, while the maximum age varies based on the policy length. For 30-year policies, the maximum age is 50. For 20-year policies, the maximum age is 65, and for 10-year policies, it is 70. Nationwide also allows policyholders to choose their payment frequency, which can be monthly, quarterly, semi-annual or annual.
Best Term Life Insurance Policy Customer Service: State Farm
pros
#1 in customer service according to J.D. Power
In-person, over the phone and online service
Wide range of term policies available
cons
Not all customer service options are available 24/7
Customer service varies for other insurance products
COMPANY HIGHLIGHTS
MoneyGeek Score: 97.4
J.D. Power (out of 1,000): 820.5
AM Best Rating: A++
NAIC Complaint Index: 0.19
According to customer rankings with J.D. Power, State Farm's customer service is unmatched. The insurer outranked 22 other life insurers to amass 838 points out of a possible 1,000 in its Life Insurance Study. Insureds and prospective applicants can contact State Farm in person, online or over the phone to ask questions, apply for insurance and file claims. The carrier also comes above average in J.D. Power’s most recent auto and home studies, making it one of the best term life insurance choices for those wanting to bundle policies.
State Farm has multiple options for term life insurance, including Instant Answer Term — life insurance with no medical exam — and return-of-premium term (which we discuss more in detail in a later section). Insureds can choose between 10, 20 and 30 years in coverage length, with death benefit amounts starting at $100,000. Current auto insurance customers can get a discount on their policy if they also buy a State Farm Select Term life insurance policy. Eligible riders for term life insurance include a select term rider for you or your spouse, a children’s term rider and a waiver of premium for disability.
Best Term Life Insurance Company for Seniors: Transamerica
pros
Generous underwriting guidelines provide competitive rates for seniors
Many seniors can qualify for small amounts of coverage with no medical exam
Coverage offered up to age 80, with some over 80 still qualifying
cons
Not available in New York
COMPANY HIGHLIGHTS
MoneyGeek Score: 80
J.D. Power (out of 1,000): 736.4
AM Best Rating: A
NAIC Complaint Index: 1.30
Transamerica offers seniors the ability to obtain coverage up to age 80 with no medical exam required under some circumstances, making it MoneyGeek's top choice for term life insurance for seniors. The Trendsetter LB and Trendsetter Super Series policies offer coverage in five-year increments from 10-30 years, and seniors may be eligible for a 30-year policy up to age 58. Coverage under both policies is available for those with pre-existing conditions that may disqualify them for medically underwritten term life insurance. Transamerica's senior underwriting guidelines allow for competitive rates on temporary life insurance coverage, even for this age group.
For a senior with a pre-existing condition that might disqualify them for medically underwritten term life insurance, Transamerica offers some coverage under both term policies with no medical exam. Seniors between 56 and 60 can get up to $249,999 with Trendsetter LB, and ages 61–70 can get up to $50,000 in senior term life insurance with no medical exam on the Trendsetter Super Series policy. With Transamerica’s generous senior underwriting guidelines, many seniors can get competitive rates for term life insurance, which is rare for this age group wanting temporary life insurance coverage.
Best Term Life Insurance Company for Young Adults: MassMutual
pros
Some frontline healthcare workers eligible for free three-year term coverage
Telehealth interview speeds up the underwriting process
Many qualify for term life insurance with no medical exam
Best term life insurance rates for young adults
cons
Limited riders
COMPANY HIGHLIGHTS
MoneyGeek Score: 84.5
J.D. Power (out of 1,000): 758.1
AM Best Rating: A++
NAIC Complaint Index: 0.07
MassMutual allows young adults coverage at some of the lowest rates available. Applicants can choose MassMutual’s Direct Term policy, which offers term life insurance with no medical exam. The entire process is done online, and it takes about 20 minutes to decide after answering some questions about your health and lifestyle.
MassMutual also offers a medically underwritten term life insurance policy called Vantage Term. Applicants can choose between 10 and 30 years in coverage in five-year increments. For this policy, a telehealth interview is required over the phone after submitting the application, which takes about 20 minutes. You will then have to complete a medical exam, which can be done at a lab or your home. MassMutual's telehealth interview process speeds up the exam and allows the company to make a decision faster than other companies using the traditional underwriting process.
Best for Return of Premium Term Life Insurance: State Farm
pros
20- or 30-year term options
Riders for disability and children’s term offered
Builds cash value
cons
Not available in Massachusetts
COMPANY HIGHLIGHTS
MoneyGeek Score: 97.4
J.D. Power (out of 1,000): 820.5
AM Best Rating: A++
NAIC Complaint Index: 0.19
State Farm's customizable return of premium term life insurance policy is among the best in the industry. If you outlive your policy, you get all your premiums back, with coverage starting at $100,000. Renewal options are available annually up to age 95, and you can also convert some or all of the death benefit to a permanent life insurance policy up to age 75. This policy also offers a children's term rider and waiver of premium for disability. Additionally, the cash value accrues, making it a more attractive option than most term life insurance policies. However, it's important to note that borrowing against or withdrawing the cash value can reduce the death benefit and return of premium amount if not paid back before the policy ends or a claim is filed. While returned premiums are tax-free, rider premiums may be taxable.
Policy Types Offered:
- Return of Premium Term Life 20
- Return of Premium Term Life 30
Best Term Life Insurance with No Medical Exam: Globe Life
pros
$1 first month coverage
Term coverage up to age 90
Online process with instant decision
cons
Rate schedule based on current age
Limited coverage
COMPANY HIGHLIGHTS
MoneyGeek Score: 95
J.D. Power (out of 1,000): 810.4
AM Best Rating: A
NAIC Complaint Index: 1.30
Globe Life is the recommended choice for term life insurance with no medical exam, costing only $1 for the first month. It offers term life coverage from $5,000 to $100,000, renewable in five-year brackets until age 90 with guaranteed rates. The application process is simple and quick, with no waiting period for coverage if approved. There are no policy customizations or riders, but you can increase your coverage if you haven't reached your maximum death benefit.
Compare Life Insurance Rates
Ensure you’re getting the best rate for your life insurance. Compare quotes from top providers to find the most affordable life insurance coverage for your needs.
Term Life Quotes from the Top Companies
Before you start shopping for term life insurance, knowing what other people are paying for their policies is helpful. Our quote tables provide pricing information from the top companies in the industry so that you can make an informed decision.
The first table displays the average cost of a 10-year term policy broken down by age and coverage amount. For 20 years of coverage, you can use the second table to compare prices for the same age and coverage amount. The last two tables show actual rates we obtained from multiple companies for both ten and 20-year term policies.
Take advantage of this valuable resource to find the best deal on term life insurance.
10-Year Term Life Insurance Average Cost by Age and Coverage Amount
Policyholder Age | $250k/10-Year | $500k/10-Year | $1M/10-Year |
|---|---|---|---|
30 | $14.75 | $18.44 | $32.05 |
40 | $18.72 | $24.80 | $45.21 |
50 | $36.67 | $55.28 | $99.51 |
60 | $81.52 | $137.14 | $258.18 |
20-Year Term Life Insurance Average Cost by Age and Coverage Amount
Policyholder Age | $250k/20-Year | $500k/20-Year | $1M/20-Year |
|---|---|---|---|
30 | $18.09 | $24.82 | $46.65 |
40 | $25.50 | $36.91 | $72.67 |
50 | $57.31 | $92.27 | $175.62 |
60 | $145.89 | $250.93 | $486.80 |
Term Life Insurance Cost by Company for a 10-Year Policy
Term Life Cost by Company | $250k | $500k | $1M | |
|---|---|---|---|---|
1. | AAA | $16.06 | $23.98 | $40.48 |
2. | Mass Mutual | $14.04 | $21.11 | $33.07 |
3. | Mutual of Omaha | $15.92 | $23.66 | $41.89 |
4. | Nationwide | $16.08 | $20.57 | $31.50 |
5. | Progressive | $19.69 | $30.46 | $84.40 |
6. | Prudential | $35.45 | $32.32 | $63.14 |
7. | State Farm | $21.11 | $29.79 | $44.84 |
8. | Transamerica | $11.40 | $16.56 | $22.36 |
Term Life Insurance Cost by Company for a 20-Year Policy
Term Life Cost by Company | $250k | $500k | $1M | |
|---|---|---|---|---|
1. | AAA | $23.43 | $37.18 | $65.56 |
2. | Mass Mutual | $20.67 | $33.94 | $60.91 |
3. | Mutual of Omaha | $21.29 | $34.41 | $63.37 |
4. | Nationwide | $22.10 | $32.82 | $57.75 |
5. | Progressive | $28.50 | $47.42 | $136.16 |
6. | Prudential | $47.94 | $45.65 | $89.80 |
7. | State Farm | $23.49 | $36.77 | $61.34 |
8. | Transamerica | $16.56 | $27.09 | $46.44 |
Compare Life Insurance Rates
Ensure you’re getting the best rate for your life insurance. Compare quotes from top providers to find the most affordable life insurance coverage for your needs.
How to Choose the Best Term Life Insurance Policy for You
Choosing the best term life insurance policy can be difficult. Follow the steps below to ensure you purchase the coverage you need at a price point you can afford.
1
Determine which features are most important to you.
These will be different for everyone — it’s crucial that you take time to consider the coverage needs that are best for you and your family before purchasing a policy.
2
Assess how much coverage you need.
Be sure to purchase enough coverage to cover the cost of current and future liabilities, like future childcare, college funds and salary replacement.
3
Get quotes from several companies.
Be sure to [compare life insurance quotes]https://www.moneygeek.com/insurance/life/compare-life-insurance/) for the same coverage limits and terms.
4
Consider customer service scores and financial rankings.
The better a company’s customer service scores through third parties like J.D. Power, the better your experience with them will likely be. A company’s financial score will show how easily it can pay out life insurance claims, which are higher per claim than auto and home insurance. Consider companies with an excellent or better financial score to ensure they can meet their financial obligations and pay your benefit if you die during your term coverage.
How Much Term Life Insurance Do You Need?
When it comes to purchasing life insurance, determining the appropriate coverage amount is crucial to ensuring the financial security of your loved ones. A commonly used rule of thumb is to multiply your annual income by 10, which gives you a rough estimate of the coverage amount you may require. However, this number may not be sufficient for families with children, as college expenses can add up quickly. To account for this, it is recommended to add $100,000 per child to your coverage amount. In this section, we'll dive deeper into calculating your life insurance needs to ensure you have the appropriate coverage to protect your family's financial future.
College Student
As a 19-year-old college student with no dependents and a $20,000 student loan debt, it may be tempting to forego life insurance. However, a small term life insurance policy with a coverage of $10,000 to $25,000 can help cover your final expenses and any remaining debts, relieving your loved ones of the financial burden. As you progress in your career and start a family, you can review and adjust your coverage accordingly.
Single Adult
Suppose you are a financially independent adult without any immediate dependents. For instance, imagine you're a 35-year-old professional making $60,000 annually. You have a debt of $25,000, comprising $15,000 in student loans and $10,000 in credit card debt, and savings of $20,000. To secure your financial future, we advise purchasing a term life insurance policy for 15 years with coverage of approximately $600,000. But it's crucial to remember that your life circumstances can change, so you'll need to reassess and modify your policy if you get married or have children.
Married Without Children
Let's say you're a married couple without children, both 35 years old and earning a combined annual income of $100,000. You have no significant debt, and your monthly living expenses are covered comfortably. However, it's still important to consider the impact of an unexpected death on the surviving spouse. To provide a safety net, we recommend purchasing a term life insurance policy with coverage that is 10 to 12 times your annual income, which would be $1,000,000 to $1,200,000. This policy will ensure that your surviving spouse can cover your final expenses and maintain their lifestyle without incurring any significant financial burden. As your family and financial circumstances change over time, it's important to review and adjust your coverage as necessary.
Single Parent
Let's say you're a 40-year-old single parent with two young children and an annual income of $60,000. You have a mortgage of $200,000 and outstanding debt of $20,000, and you estimate that it will cost approximately $150,000 to cover your children's education expenses. To provide financial security to your family in case of your unexpected passing, we recommend purchasing a term life insurance policy with coverage that is at least 10-12 times your annual income. In this case, a policy with coverage of $600,000 to $720,000 would be appropriate. This amount will help ensure that your children's living expenses, education, and outstanding debts are covered if you're no longer there to provide for them. As your children grow older and become financially independent, you can re-evaluate your life insurance needs and adjust your coverage accordingly.
Married With Children
Let's say you are a married couple with two children, ages 5 and 8. You both work full time and have a combined annual income of $120,000. You have a mortgage of $300,000 and other debts totaling $50,000. You estimate that it will cost approximately $300,000 to cover your children's college expenses. In the event of either of your unexpected passing, your family could face significant financial challenges, which is why life insurance is essential.
To ensure that your family is protected in case of your unexpected passing, we recommend purchasing a term life insurance policy with coverage that is at least 10-12 times your annual income. In this case, a policy with coverage of $1.2 million to $1.44 million would be appropriate. This amount will help ensure that your family's living expenses, mortgage, debts, and your children's education expenses are covered.
It's important to remember that as your family's financial situation changes, you may need to adjust your coverage accordingly. Regularly reviewing and updating your life insurance policy can help ensure that your family is always protected.
Senior
Let's say you are a healthy senior in your 70s, retired with no significant debts or financial dependents. At this stage in life, it's important to ensure that you have adequate financial protection for your loved ones in the event of your passing. We recommend purchasing a policy with coverage that is at least enough to cover your final expenses, such as funeral costs and any remaining debts or bills. A policy with coverage of $10,000 to $25,000 can be relatively affordable for a healthy senior and provide the necessary financial protection for your loved ones. Additionally, if you have any outstanding debts or expenses that you want to cover, you may want to consider purchasing a policy with a higher coverage amount.
What Happens if You Live Beyond Your Term Life Insurance Period?
If you live beyond your term period, the policy expires, and you no longer have coverage. Some companies offer the option to renew your term life insurance each year, but this is usually expensive as renewal rates are based on your current age and not the age you took out the policy.
If you need life insurance beyond the term period, you may want to consider purchasing permanent life insurance for that amount of coverage. Converting some of your term life insurance death benefit to a whole life insurance policy before the term expires is also a good option.
Compare Life Insurance Rates
Ensure you’re getting the best rate for your life insurance. Compare quotes from top providers to find the most affordable life insurance coverage for your needs.
FAQs About the Best Term Life Insurance Companies
There can be some confusion about term life insurance, especially regarding its costs and how this type of policy works. Understanding the answers to some common questions regarding term life insurance can help you find the best insurer and policy for your needs.
Methodology
We go the extra distance so that you can feel confident about the life insurance content you read on MoneyGeek. Our ranking for the best term life insurance companies incorporates third-party analysis from AM Best and J.D. Power and Associates, real policy quotes from our proprietary research and analysis of each company’s policy offerings and application process. To learn more, visit our complete methodology page.
Life Insurance
About Mark Fitzpatrick
sources
- J.D. Power. "2020 U.S. Life Insurance Study." Accessed November 15, 2021.
- MassMutual. "HealthBridge Program." Accessed November 15, 2021.