Term life insurance is an incredibly popular insurance product, and for good reason. Millions of Americans have a term life insurance policy to help financially protect their family. With so many insurance products on the market today, it may be difficult to decide which one you should go with for your term life insurance policy. Let’s dive into our top term life insurance options below!
Quicklook: Best Term Life Insurance
- TransAmerica — Best Affordable Option
- Northwestern Union — Best for Those Looking to Work With a Financial Advisor
- MassMutual — Best for a Quick and Easy Sign Up
- New York Life — Best Convertible Option
- AIG — Best for Consistently Low Rates
- Lemonade — Best for Utilization of Technology
- Bestow – Best for Applying in Minutes
Table of Contents:
- Best Term Life Insurance Companies
- It’s Important to Note
- What Is Term Life Insurance?
- How Does Term Life Insurance Work?
- What Makes a Good Term Life Insurance Company?
- What Is the Difference Between Term and Whole Life Insurance?
7 Best Term Life Insurance Companies
We’ve scanned the market and isolated our top 7 best life insurance companies below.
If you’re on a budget, consider getting term life insurance from TransAmerica. You can get a lot of insurance for a relatively low cost, in a very short period of time.
Coverage Offered: TransAmerica offers various insurance packages. Their term life insurance options come as 10/15/20/25 and 30 years.
Standout Features: The affordability of TransAmerica is what customers appreciate the most.
- The insurance is affordable
- The insurance offers a high death benefit, considering the premium
- The customer satisfaction is lower than other options on the market
- There is limited whole life insurance options
- Their mobile app is less than ideal
Insurance is often a piece of financial planning. If you want to keep all your financial plans and insurance packages under one roof, Northwestern Mutual can answer that wish!
Coverage Offered: Not only does Northwestern Mutual provide insurance packages, they also take care of investments. They have a wide range of investment and insurance options.
Standout Features: Combining your financial planning and insurance under one roof makes a lot of sense. It will keep your important documents organized, and easily accessible.
- Northwestern Mutual has stood the test of time, being in business for 160+ years
- They have an A++ rating
- You can combine your insurance and investments all under one roof
- The website doesn’t provide great visibility into what their product offerings include
- Following the above bullet, you need to contact their agents to get more details on their offering.
- There are limited riders available
MassMutual has been in business since 1851. In today’s world, MassMutual has earned the reputation of being a quick and easy sign up and for their various high quality insurance products.
Coverage Offered: MassMutual offers various insurance products, such as; term life, universal life, variable life, and whole life. In addition to offering insurance products, MassMutual provides retirement and investment plans.
Standout Features: MassMutual provides a lot of information, and calculations, on their website. You can see how much insurance they recommend, and what policies offer various benefits.
- MassMutual has an A++ rating
- MassMutual is well known and respected for customer satisfaction
- Signing up is easy!
- Mass mutual offers various insurance and investment options
- You can’t make a claim online
- Medical exams are required if/when a policy expires
New York Life
New York Life has been at the service of their people for 175 years! They have become a powerhouse in the insurance world, and for good reasons. Their ability to convert one policy to another is second to none.
Coverage Offered: New York Life offers term, whole, and universal life insurance. Additionally, they have retirement planning options, annuities, mutual funds and access to ETFs.
Standout Features: Signing up for term insurance, and eventually converting it to whole life insurance, is a breeze with New York Life!
- Converting a policy from one option to another is easy
- They offer a wide range of coverage, insurance products, and investment products
- The company has a strong reputation and a track record of helping people
- Their website is limiting in how much information they display
- There is not a 30 year term life insurance policy
AIG is another phenomenal insurance option. With so many different insurance options to choose from, and the consistently low rates they offer, millions of Americans turn to AIG for their competitive offerings!
Coverage Offered: AIG has a wide variety of products. From insurance, to employee/company benefits, and investment options, AIG can be fully encompassing.
Standout Features: AIG is well known for their respected rates!
- You can get a free quote online
- AIG offers a wide range of life insurance products
- AIG has a great amount of educational material
- There are 18 different term durations
- Customer satisfaction is on the lower end
- The online quote process can provide a large delta between what you were quoted and what your insurance actually ends up being
Lemonade is a new insurance company, founded in 2015. This is a common option for younger folks considering how straight forward and easy to use their mobile app is. Lemonade is a great hassle and fuss free option for those who want to get coverage fast!
Coverage Offered: Lemonade offers term, pet, renters, and homeowners insurance.
Standout Features: Their technology is cutting edge and the platform is a unique new option for those looking for insurance.
- Their website is easy and fun to use
- The mobile app is fantastic
- Their rates are super low!
- This is a new company that has yet to prove the test of time
- They do not offer as wide of a range of insurance products as other companies on this list
If you are looking to apply for insurance ASAP, Bestow may be the right option for you! Bestow was founded in 2016, and is reimagining the entire insurance world. This option is completely online and will provide you a convenient and efficient new way to obtain insurance coverage!
Coverage Offered: Bestow offers term life insurance in various time intervals.
Standout Features: It’s super easy, and quick, to apply for coverage!
- The application is fully online
- Coverage ranges from $50k – $1.5M
- You do not need a medical exam or lab work to get this insurance
- You can apply in just 8 minutes online
- This is a new company that is still working on proving itself
- Bestow is not available in New York
- The investment options are limited
It’s Important to Note
Insurance companies have the right to refuse coverage. Coverage is not guaranteed, and underlying conditions, or a family history of specific conditions, can cause an insurance company to deny coverage.
Additionally, the price per plan is entirely contingent on one’s age, medical history, lifestyle habits, and the family medical history.
What Is Term Life Insurance?
What is term life insurance? Simply put, term life insurance is a type of insurance product one can carry that pays a death benefit. However, in order for this death benefit to be paid, the insured individual would need to pass away during the insurance term agreed upon.
For example, someone could carry term life insurance for 10 years. If in year 8 the individual passed away, a death benefit would be paid. However, if in year 12 the individual passed away, and they did not renew or roll over their term life insurance policy, no death benefit would be paid as the individual is no longer in term.
How Does Term Life Insurance Work?
Exactly how does term life insurance work? Believe it or not, the mechanics of term life insurance are quite simple.
An individual would apply for term life insurance through an insurance company. The insurance company will require the individual to complete a medical exam and a long list of questions.
Upon completion of the medical exam and questions, the insurance company would let the individual know how much term life insurance they qualify for, and what the premiums would be on a policy. The policyholder will need to make regular payments to carry this insurance.
If the policy holder passes away during the insured period, a death benefit is paid to the policyholder’s beneficiary. If the policy holder outlives their term life insurance policy, they will receive all the premiums they’ve paid into the insurance over the years in one lump sum.
What Makes a Good Term Life Insurance Company?
If you’re interested in term life insurance, you’ll want to understand what makes a good term life insurance company. There are a few variables you must consider to answer this question.
Working with a transparent insurance company is key. The world of insurance can certainly be confusing.
You’ll want to work with a company that spells everything out for you, and doesn’t hide important information in documents that are difficult to understand. Reputation is important as well, so be sure to do your research on who has a respected reputation in the industry.
Offers You Quotes
When choosing the best term life insurance, you’ll want to get various quotes. Some companies are very private with their quotes and are not too eager to share this information.
You’ll want to work with a company that provides various quotes for the term life insurance policies you are interested in. This aspect goes along with a company’s transparency and will ensure you are getting the best possible rate from a trusted insurance company.
Multiple Policies Offered
There is also not a one size fits all approach with term life insurance. You can adjust numerous variables that can increase or decrease your monthly premium.
Work with a company that presents you with numerous options, and find the term life insurance that is best fit for your lifestyle and your needs.
When selecting the best term life insurance, you must also consider the various rider options you can add onto your policy. Riders can multiply your death benefit if triggered.
For example, you can add an accidental death rider to your term life insurance policy, which would increase your pay out if you passed away due to an accident.
What Is the Difference Between Term and Whole Life Insurance?
There are plenty of insurance options on the market today. Term and whole life insurance are two very popular insurance products. But what is the difference between term and whole life insurance?
Term life insurance provides coverage for a specific period of time, typically 10/20/or 30 years and does not build a cash value. Whereas whole life insurance is insurance one carries until they pass away.
Not only does whole life insurance provide a death benefit for the policyholder, it also grows a cash value. The policy holder can draw against their whole life insurance policy if they needed to.
Know Your Options
Term life insurance is an incredibly popular insurance product that can provide financial security to your loved ones in the event you pass away. Term life insurance can be affordable, and if you sign up for this insurance in your younger years, you can save quite a bit of money!
All insurance and investment products should anchor on a goal. Working with a financial advisor is a great way to ensure you are covering all your bases and that the steps/actions you’re taking will bring you closer to your desired outcome.
Term and whole/permanent insurance are two different products with two different purposes. Without fully understanding one’s goals or financial picture, it’s impossible to say which product is best suited for an individual or family.
The earlier you can buy term life insurance, the better! Term life insurance gets more expensive as you get older, as the older you get, the ‘riskier’ you are to insure.
If you outlive your term life insurance policy, all the premiums you paid into the policy will be paid back to you.