How to Compare Life Insurance Policies


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ByKali Hawlk
Edited byCasie McCoskey
Contributions by3 experts
ByKali Hawlk
Edited byCasie McCoskey
Contributions by3 experts

Updated: May 22, 2024

Advertising & Editorial Disclosure

No one wants to think about the worst-case scenario, but it's prudent to have a plan in place to care for your family and loved ones in case anything happens to you. Getting the right life insurance can be a significant step in that process.

Simplifying the comparison of life insurance companies and rates helps you make an informed decision. With the right approach, you can confidently select a plan that meets your family's needs, ensuring their secure future.

Get Life Insurance Quotes

Whether you're searching for life insurance quotes online or simply exploring other options like life insurance quotes without personal information, starting with a comprehensive comparison is key. Exploring some of the biggest life insurance companies in the country can offer insights into different policy offerings.

Aflac Inc.

In addition to life insurance, Aflac offers supplemental income insurance. It's the largest supplier of voluntary workplace insurance in the United States for those who want to protect themselves and their families in the event of sickness or injury. But it's also a good option if you want a small, affordable life insurance policy.

Allstate

Allstate offers term life policies with coverage ranging from 10 to 30 years, as well as permanent insurance. It also provides a program called TrueFit, which lets you customize life insurance coverage to fit your budget. Read our review of Allstate life insurance to learn more about its life insurance coverage.

MetLife Inc.

MetLife makes it easy to compare term life and whole life with a chart of its policies, features and sample costs on the website. This is an excellent place to start if you need clarification on what kind of life insurance you want. You can even apply online for a $10,000 term or "guaranteed acceptance" whole life policy. Read our MetLife life insurance review to learn more about its life insurance coverage.

Mutual of Omaha

Mutual of Omaha provides up to $250,000 in life insurance, but its website is skimpy on details. According to a recent J.D. Power survey, it scored almost the same as Allstate in overall ratings. It has been in the business for over 100 years, and its financial strength ratings are "superior" and "very strong," making it a reliable insurance provider.

Nationwide

Nationwide is another company that offers insurance policies for every need, in addition to retirement and banking services. A Fortune 500 company, it gets top ratings from organizations that rate the financial strength of insurance providers. Among its attractive life insurance features are a long-term care rider and "CareMatters" — long-term care linked to a life insurance policy.

New York Life Insurance Group

One of the most important factors to consider when choosing a life insurance company? Its financial strength. New York Life remains a top choice because it currently earns some of the highest financial strength ratings from all four rating agencies. Read our New York Life Insurance review to learn more about its life insurance coverage.

Prudential Financial Inc.

Prudential is another long-standing company that has been providing insurance for over 140 years. It will help you find a policy with its educational resources, including tips on how to customize your policy to meet your needs. Read our Prudential life insurance review to learn more about its life insurance coverage.

Western & Southern Life Insurance Company

One of our picks for the top life insurance companies, Western & Southern Life Insurance Company, offers a range of term, whole and universal policies. This insurer also provides a selection of riders to add to your coverage, such as guaranteed premium level and accelerated death benefits. Use its online quote generator to see how much your premiums would be for a term policy.

How to Compare Life Insurance Quotes

When it comes to making comparisons between life insurance policies, it's helpful to know what information to evaluate and what you need to get started. By preparing for this process, you're better equipped to find the best life insurance quote for your needs.

What to Compare

In this section, we highlight the most relevant life insurance policy components so you can more accurately compare quotes.

Type of Policy

There are different types of life insurance policies. The first step in choosing the right policy includes understanding the differences between term and permanent life insurance policies, including whole and universal. Each type has its own advantages, depending on your financial goals and the level of coverage you seek.

If you need more clarification, talk to a professional with your best interests in mind and who doesn't make a commission off the sale of a policy. A fee-only financial advisor is an excellent place to start. You can find one through organizations like the National Association of Personal Financial Advisors (NAPFA).

Amount of Coverage

Before you can compare policies, you need to determine how much coverage you need. Then compare apples to apples to ensure an accurate life insurance quote comparison: You can't compare a $100,000 policy from one company with a $500,000 policy from another and expect the same rate. Decide how much you want your policy to cover, then gather quotes from different companies for that amount. Resources like the online calculator from the nonprofit LifeHappens can aid in assessing your coverage needs accurately.

Cost of Premiums

Once you choose the type of policy you want and gather quotes on life insurance across companies for the same coverage amounts, you can compare life insurance policies fairly. Start by looking at the annual premiums on each policy.

Other Fees

Look at what other fees or costs might be involved with each policy. The life insurance with the lowest premium isn't necessarily the best deal. Check for additional fees, and consider the benefits you get in exchange for the expenses incurred.

Fine Print

By checking the fine print of your policy, you'll find answers to some critical questions, including:

  • Does the premium change year to year?
  • Which benefits are guaranteed with the policy, and which are subject to change?
  • Can you add specific riders to the policy? How much will those riders cost?

Having these answers will help you accurately compare quotes from different providers.

What You Need to Get a Life Insurance Quote

Life insurance companies want a lot of information from you before they'll generate a quote. Your quote is specific to you, your situation, your health and what you want from a policy. Companies use this information to determine how risky it will be to insure you. Below is a checklist of information typically necessary for life insurance applications:

  • Gender
  • Age
  • Height and weight
  • Whether or not you smoke
  • How much you drink
  • Lifestyle habits, like how often you exercise
  • General information about your overall health (whether you're in good health, fair health or poor health)
  • How much coverage you want
  • Your preference for how long the policy will last

Gathering this information beforehand can help you compare life insurance quotes more efficiently.

When to Update Life Insurance Coverage

The life insurance you need to protect you today may not look like the policy you need in the future. Over time, as the circumstances of your life change, the policy you and your loved ones need will also change. Any time you hit a significant milestone or go through a major transition, reviewing your coverage and making sure it's still appropriate for you and your family is wise. The Insurance Information Institute provides information on insurance considerations during different life stages.

When you review your life insurance policy, you'll want to ensure the coverage, terms, benefits, riders and premiums still make sense for you and what you want. You will likely always need some sort of insurance, but how much coverage you need is likely to change as you progress through life.

Here are some common life events that usually trigger a need to reassess your life insurance coverage:

    engagementRing icon

    You get married

    When you and your partner tie the knot and officially become a joint household, your finances will likely go through a change. If you already have a life insurance policy, review it and ensure your coverage will be enough to take care of your new spouse should anything happen to you. Likewise, make sure your partner has a life insurance policy to take care of you.

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    You buy a home (or take on another large debt)

    Taking out a big loan means adding financial responsibility. Make sure your coverage can handle the added expense.

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    You have a baby

    In addition to bringing you joy, your new baby brings you additional financial responsibility. You now have a dependent who relies on you financially. A life insurance policy ensures your child has the necessities covered and potentially the funds for future education endeavors.

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    You get divorced

    Just as marriage should trigger a review of your coverage, so should a relationship split. You may not need to carry as much coverage if your marriage dissolves.

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    Your income changes

    If your income and expenses go up, update your insurance coverage to reflect that. Similarly, a drop in income may mean you can pay less for the coverage you need.

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    You stop financially supporting loved ones

    If your kids graduate from college and become financially independent adults, or if you no longer care for a family member who used to rely on your income, update your coverage. If the policy doesn't need to provide for as many people should you pass away, you may not need to carry so much insurance.

Regularly comparing life insurance quotes and policy features ensures your coverage evolves with your life, providing peace of mind through all of life's transitions.

How to Save Money on Life Insurance

Finding the right policy that suits your financial situation and needs is necessary to protect and provide for your loved ones even after you're gone. But life insurance rates can be expensive. Comparing life insurance quotes from multiple providers can prevent you from paying too much. Here are some tips to ensure you get the best life insurance quotes for your policy.

1
Choose the right policy for you and your needs

Don't buy a term life policy that spans 20 years with $500,000 worth of coverage if you only need your insurance to cover $125,000 and 10 years.

2
Get help

Knowing your needs is the most significant step you can take to save money on life insurance. Look for an advisor who will sign a fiduciary oath on your behalf, meaning they uphold a legal and ethical standard to put your interests first. This means they need to recommend the best product for you — not just one that's suitable.

3
Participate in group insurance

Many employers offer some form of life insurance. Going with a group policy like this may be cheaper than buying insurance on your own, according to the Insurance Information Institute.

4
Shop around

Always gather and compare life insurance quotes from a variety of companies. This will allow you to choose the policy with the most value for your dollar.

5
Ask about premium discounts

Some companies provide discounts on specific amounts of coverage. A $200,000 policy might actually be cheaper for you than a $150,000 policy.

6
Take care of yourself

The healthier you are, the cheaper your life insurance rates will be. Take charge of your health and be aware of lifestyle factors that may contribute to higher premiums.

How to Find the Best Life Insurance Company

Getting good life insurance quotes starts with choosing good life insurance companies. We talked with a line-up of veteran financial experts to give you their insider tips and tricks on what to look for in a top life insurance company.

  • Meg Bartelt, MSFP
    Meg Bartelt is the president and founder of Flow Financial Planning, a virtual, fee-only financial planning firm dedicated to helping working mothers in the tech industry.

  • Thomas Vetter, CFP
    Thomas Vetter is a Certified Financial Planner (CFP®) and the founder of Vetter Planning.

  • Dave Zaegel, CPA, CFP
    Dave Zaegel is the President of CWO for Hire, a wealth management firm that provides comprehensive financial planning solutions to business owners.

What should you do before running a life insurance comparison?

Meg Bartelt
Meg Bartelt:

"Spend time figuring out what your life insurance needs are. Sure, there are rules of thumb (like 10x your annual salary) which are better than nothing. But life insurance should be about covering your dependents' financial needs and paying their expenses, which is different than income."

How can you find the best life insurance company?

Thomas Vetter
Thomas Vetter:

"Finding the best life carrier depends on what type of product you're looking for: term life, whole life or universal life. Most large companies have each of these types of insurance available, but each is better in certain markets. Start by determining if your life insurance need is temporary or permanent. "I use the Comdex rating to run a life insurance comparison across companies. A Comdex ranking is a composite score averaging the ratings of the major insurance rating organizations, including AM Best, Fitch, Moody's and S&P. The Comdex is not truly a rating, but a ranking based on the average of all the different ratings these different organizations give an insurance company."The lowest-priced premium should not be the first and only way to qualify a company. It should be based on financial strength — it doesn't necessarily have to be a perfect score, but it needs to be a higher score. Remember, you buy insurance because you want it to be there when your beneficiaries need it. I prefer mutual companies over stock companies when buying permanent insurance. When I worked at the home office of a major carrier, I would fill out the financials that would be submitted to the rating agencies. Boring, but necessary!"

Should you use an agent or get quotes online?

Dave Zaegel
Dave Zaegel:

"Don't waste your time with online quotes. Often, they show you the lowest cost quote, assuming you have perfect health. That's not the case for everyone; each insurance company evaluates applicants differently based on their health condition. A good agent will guide you through that.

A good agent can get quotes and is knowledgeable across multiple companies. A 'captive' agent only sells insurance for one company. Look for a broker who will check multiple companies to find the best option for you."

What features or qualifications does a good life insurance agent possess?

Dave Zaegel
Dave Zaegel:

"Your agent should help evaluate your insurance need based upon all your finances and be able to clearly show you how they came up with the amount of coverage needed. For a younger demographic, this typically consists of how much income you want to replace and for how long you want the income, what debts you want to pay off, and any future expenses that you would want to fund from the death proceeds (like child education or spouse retirement)."

Any red flags to watch out for when choosing a life insurance company?

Meg Bartelt
Meg Bartelt:

"Watch for indications of bad customer service. That's the last thing you want upon your death is a bad customer service experience for your survivors. You also want to avoid a company without a long track record. Your life insurance policy might be 20 or 30 years long. You want a company that has already shown an ability to stay in business that long.

"And there's no need to put up with upselling. You figure out the amount of coverage you need (your death benefit) and how long you need it (the term) and then stick with that. There are plenty of term life providers out there, so you don't need to feel pressure to work with any one company."

About Kali Hawlk


Kali Hawlk headshot

Kali Hawlk is a writer “passionate about using her skills and knowledge to help others make, do, and create more.” She shares ideas and stories on business, finance, entrepreneurship “and living mindfully and with intention.” She's been featured as a financial expert for Millennials in many online publications including Forbes, Fast Company, US News and Mashable. You can catch her on KaliHawlk.com, read her latest writing on Medium.com/ @KaliHawlk or connect with her on Twitter @KaliHawlk.