How We Review and Rate Life Insurance Companies

Reviewed by Eric EstevezReviewed by Eric Estevez

Investopedia’s list of the best life insurance companies is based on exhaustive research of 45 companies that sell life insurance policies. We reviewed each company’s financial strength, customer complaint record, digital application and policy management tools, policy offerings, and much more. This guide explains how we determined these categories and criteria, the methods we used to score each company, and how we ultimately chose the best life insurance companies.

Our editors and researchers independently evaluate all recommended products and services. If you click on the links we provide, we may receive compensation. Our advertising partnerships are not a factor in evaluating products, though they may affect the order of products you see listed in our articles.

How We Research Life Insurance Companies

We combined subject matter expertise, consumer survey and company survey data, and industry research to create a quantitative model that scores each company based on six major categories and 70 criteria.

In March 2024, we surveyed 500 people who had gotten a whole, term, or universal life insurance policy in the prior 24 months. We used the results to inform our criteria, weighting, and scoring process for our 2024 best life insurance companies rubric. We adjusted the weights for policy types and features, application processes, and online tools based on the survey results. We learned that life insurance buyers most value financial strength and costs, as well as the ability to buy the specific coverage amount they want. Top motivations are covering burial costs and replacing income. 

We determined that 45 life insurance companies met our minimum standard for financial strength, customer satisfaction, and online transparency. We gathered 70 evaluation criteria for each company, resulting in 3,150 data points. Data was collected between May 20 and July 3, 2024, and sourced from company webpages, media representatives, third-party rating agencies (AM Best, NAIC, and J.D. Power), and customer service calls.

Life Insurance Evaluation Categories

Based on a combination of subject matter expertise, the results of our consumer survey, and third-party consumer research from the insurance trade association LIMRA, we developed the following category weights.

Category	Weight for Best Overall Life Insurance Companies
Application and Online Service Features	15%
Policy Types	22%
Policy Features and Riders	35%
Financial Stability	6%
Customer Satisfaction	10%
Cost	12%
Total	100%

These categories included 70 criteria. We weighted 30 but collected the other 40 for editorial reasons and for use in future reviews. 

Category	Number of Weighted Criteria for Best Overall Life Insurance Companies
Application and Online Service Features	3
Policy Types	7
Policy Features and Riders	16
Financial Stability	1
Customer Satisfaction	1
Cost	2
Total	30

Through our data collection and review process, Investopedia has provided you with an unbiased and thorough review of the top life insurance companies.

Data Collection and Scoring

• Data points are scored on a 0.00 – 1.00 scale
• Binary criteria = [0,1]
• Scaled criteria (e.g., 5-point) = [0.00, 0.25, 0.50, 0.75, 1.00]
• Continuous criteria: If higher values indicate better results (e.g., maximum death benefit), the lowest value in the database was re-scaled to a score of 0.00, and the highest was re-scaled to 1.00. If lower values indicate better results (e.g., premiums), the highest value received a score of 0.00, and the lowest a score of 1.00. All other values received scores relative to their distance from the extremes.  

Financial Stability

Consumers need to trust that the life insurance company they choose will be stable enough to last as long as their life insurance policy is in force, which could be decades. Companies must also have the financial strength to fulfill their obligations to pay claims, which could amount to millions of dollars for a single policyholder.

Our survey results showed that financial stability was a crucial consideration for insurance consumers. We considered only the 45 companies that fared the best in a key measure of financial stability to ensure we only recommend companies that can pay their claims for years to come.

To assess each company’s financial stability, we considered its AM Best rating. AM Best was founded in 1899 as the world’s first credit rating agency. Today, it is the largest credit rating agency in the world specializing in the insurance industry. It conducts independent assessments of the creditworthiness of more than 16,000 insurance companies, judging their ability to pay claims, debts, and other financial obligations. 

AM Best rates insurance companies on a scale from A++ to D-. We only included companies in our rubric with at least an A- or “Excellent” financial strength rating, meaning AM Best believes they have “an excellent ability to meet their ongoing insurance obligations.”

We scored AM Best ratings on a scale from 0.7692 – 1, in steps of 0.077, where an A- rating received the lowest score on our scale, and an A++ received the highest.

Year Established

For editorial reasons, we collected data on when each insurance company was established. While we didn’t score this data, we thought it provided some insight on each company’s financial stability.

State Availability

We also looked at where each life insurance company is licensed to sell policies. We didn’t score this data, but we only considered companies that at least operate throughout the continental United States.

Application Process and Online Service Features

While it’s important to have conversations with licensed agents as part of the buying process, consumers should also be able to buy and manage policies digitally, just like they can with other financial products.

To evaluate the application process and online tools, we looked at the following features.

Online Quote Availability

We scored this on a binary scale, awarding 1 point to companies allowing you to get a quote for term insurance online without contacting an agent, and 0 to companies that don’t. We awarded another point to companies that offered online quotes for no-medical-exam policies.

The ability to get quotes online is important because it allows you to easily compare quotes and understand your costs.

Online Application Availability

We scored this on a binary scale, awarding 1 point to companies offering an online application and 0 to companies that don’t.

Consumers should be able to buy insurance online, just like they can with other goods and services, without needing to contact an agent or sales representative first.  

Online Claim Availability

We scored this on a binary scale, awarding 1 point to companies offering the ability to initiate a life insurance claim online, either on a website or via email, and 0 to companies that don’t.

While the person buying life insurance will likely not be filing a life insurance claim in the future, ideally, their beneficiaries have a convenient online option for doing so, which is especially important when they might be grieving.

Same-Day Decision Availability

We scored this on a binary scale, awarding 1 point to companies offering the ability to be approved for a life insurance policy within a day, and 0 points to companies that don’t.

The availability of same-day decision policies is important for people seeking financial protection without a lengthy underwriting process, either because of convenience or because they wouldn’t qualify for traditional policies. 

Live Customer Service Chat

We scored this on a binary scale, awarding 1 point to companies with a chat function on their website that connects you with a human representative (not a robot), and 0 points to companies that don’t.

Live chats are a great customer support and accessibility feature, allowing people to get real-time assistance with their questions and concerns.

Policy Types

A company that offers more policy types can better meet diverse customer needs and provide tailored coverage options. 

We checked whether insurance companies had the following policy types:

• Term life insurance
• Money back, return-of-premium (ROP) term life
• Term life with annual renewal
• Whole life insurance
• Final expense or burial insurance for whole life
• Dividend-paying whole life
• Children’s whole life
• Universal life insurance
• Indexed universal life
• Variable life or variable universal life
• Joint or first-to-die life insurance
• No-medical-exam life insurance

We awarded 1 point for each policy type a company offered. If a company was missing a policy type, it got 0 points for that policy type.

Policy Features and Riders

Digging deeper, we looked at each company’s specific policy features and riders. These provide insight into the flexibility and comprehensiveness of coverage options.

Term Insurance Minimum Coverage Amount

We scored this on a continuous scale of 0 to 1, such that companies with the lowest minimum coverage amounts received a higher score and companies with a higher minimum coverage amount received a lower score. Globe Life had the lowest term life death benefit requirement at $5,000, while companies such as Securian, Minnesota Life, and Symetra required at least a $250,000 death benefit.

A low minimum coverage amount is important for consumers who may have a limited budget for financial protection.

Term Life Maximum Coverage Amount

We scored this on a continuous scale of 0 to 1, such that companies with the highest maximum coverage amounts received a higher score and companies with a lower maximum coverage amount received a lower score. Several companies don’t impose a cap on the total death benefit amount, but among those that do, Globe Life had the lowest maximum at $100,000.

A high maximum coverage amount is important for consumers to ensure they get all the financial protection they need from their policy.

Term Insurance Maximum Issue Age

We scored this on a continuous scale of 0 to 1, with companies that had the highest maximum issue age receiving a higher score and companies with a lower maximum issue age receiving a lower score. Globe Life had the highest maximum issue age of 90 years, while companies including Lincoln Financial and Equitable only offer term policies for individuals up to age 60.

Higher age limits are important for consumers who might want coverage later in life.

Maximum Term

We scored this on a continuous scale of 0 to 1, with companies that had the highest maximum terms receiving a higher score and companies with a lower maximum term receiving a lower score. Protective and Banner Life offer term lengths of up to 40 years, the highest among the companies we researched. Globe Life had the most limited term length offerings with a maximum of five years.

A variety of term lengths allows consumers to find coverage that aligns with their specific needs. 

Term Life Insurance With Conversion

We scored this on a binary scale, awarding 1 point to companies that offer term life policies that can be converted to permanent policies, and 0 points to companies that don’t. We awarded an additional point if companies offered conversion with no additional cost.

Convertible term life insurance allows policyholders to convert their term policy into a permanent policy without undergoing additional medical underwriting, which could be a good option for policyholders whose financial needs may change later in life.

Whole Insurance Minimum Coverage Amount

We scored this on a continuous scale of 0 to 1, such that companies with the lowest minimum coverage amounts received a higher score and companies with a higher minimum coverage amount received a lower score. Companies including Protective and Transamerica issue whole life policies with coverage as low as $1,000. Brighthouse Financial had the highest minimum coverage amount at $250,000.

A low minimum coverage amount is important for consumers who may have a limited budget for financial protection.

Whole Life Maximum Coverage Amount

We scored this on a continuous scale of 0 to 1, such that companies with the highest maximum coverage amounts received a higher score and companies with a lower maximum coverage amount received a lower score. Several companies do not have a coverage maximum, but among those that do, the lowest was Colonial Penn at $25,000.

A high maximum coverage amount is important for consumers to ensure they get all the financial protection they need from their policy.

Whole Life Maximum Issue Age

We scored this on a continuous scale of 0 to 1, with companies that had the highest maximum issue age receiving a higher score and companies with a lower maximum issue age receiving a lower score. MassMutual, Thrivent, and Guardian Life had the highest maximum issue ages; all three issue whole life policies for individuals up to age 90. Aflac had the lowest limit for whole life issue age, only offering policies up to age 70.

Higher age limits are important for consumers who might want coverage later in life.

Whole Life Insurance Dividend Rate

We scored this on a continuous scale from 0 to 1, where companies with higher dividend rates received a higher score and companies with lower or no dividend rates received a lower score. 

MassMutual’s 6.1% dividend interest rate (as of July 2, 2024) was the highest among all companies we researched.

Universal Insurance Minimum Coverage Amount

We scored this on a continuous scale of 0 to 1, such that companies with the lowest minimum coverage amounts received a higher score and companies with a higher minimum coverage amount received a lower score. Many companies shared the lowest minimum coverage amount for universal life policies at $25,000. Northwestern Mutual had the highest minimum coverage requirement, at $250,000. 

A low minimum coverage amount is important for consumers who may have a limited budget for financial protection.

Universal Life Maximum Coverage Amount

We scored this on a continuous scale of 0 to 1, with companies that had the highest maximum coverage amounts receiving a higher score and companies with a lower maximum term receiving a lower score. Several companies offer universal life policies with no specified maximum, but among those that have a limit, Columbus Life had the lowest maximum coverage amount at $100,000. 

A high maximum coverage amount is important for consumers to ensure they get all the financial protection they need from their policy.

Universal Life Maximum Issue Age

We scored this on a continuous scale of 0 to 1, with companies with the highest maximum issue age receiving a higher score and companies with a lower maximum issue age receiving a lower score. John Hancock had the highest maximum issue age for universal policies, issuing policies up to age 90. Penn Mutual had the lowest maximum issue age, at 71 years old. 

Higher age limits are important for consumers who might want coverage later in life.

No-Medical-Exam Policy for Universal Life

We did not score this category, but we collected this data to help judge the best companies for universal life insurance.

Burial Insurance Maximum Coverage Amount

We scored this on a continuous scale of 0 to 1, with companies with the highest maximum coverage amounts receiving a higher score and companies with a lower maximum term receiving a lower score. The highest burial life coverage amount was $50,000, offered by companies including Nationwide and Lafayette Life. State Farm offered the lowest death benefit amount for burial insurance at $15,000.

A high maximum coverage amount is important for consumers to ensure they get all the financial protection they need from their policy.

Burial Insurance Minimum Issue Age

We scored this on a continuous scale of 0 to 1, such that companies with the lowest minimum issue age received a higher score and companies with a higher maximum issue age received a lower score. Nationwide and Transamerica are the least restrictive regarding issue age for burial insurance, as anyone can apply and receive coverage starting at birth. Other companies—such as SBLI, Foresters, and Gerber Life —require applicants to be at least 50 years old to qualify for a policy.

Lower age limits are important for consumers who want to guarantee coverage while they’re young.

Burial Insurance Maximum Issue Age

We scored this on a continuous scale of 0 to 1, with companies that had the highest maximum issue age receiving a higher score and companies with a lower maximum issue age receiving a lower score. The lowest maximum issue age was 80 years old, and was shared across companies such as Nationwide, State Farm, and Farmers. The highest maximum issue age was 85 years old, offered by SBLI, Lafayette, and USAA. 

Higher age limits are important for consumers who might want coverage later in life.

Burial Insurance Graded Benefit Period

We scored this on a continuous scale of 0 to 1, where companies with the shortest graded benefit period received a higher score and companies with the longest graded benefit period received a lower score. The highest graded benefit period was three years, including companies such as SBLI, Fidelity Life, and Lafayette. The lowest-graded benefit period was two years, shared by many companies that offer burial insurance.

During the graded period, which typically lasts two to three years, the full death benefit is not paid out if the insured person dies, so a shorter graded period is typically better for beneficiaries.

No-Medical-Exam Insurance Maximum Coverage Amount

We scored this on a continuous scale of 0 to 1, where companies with the highest maximum coverage amounts received a higher score and companies with a lower maximum term received a lower score. 

We awarded an extra 1 point to companies who offered at least $50,000 in coverage for no-medical-exam life insurance. 

Banner Life has no specified maximum on its no-medical-exam policies, allowing beneficiaries to get the highest possible death benefit across the companies we researched. The lowest death benefit maximum was $25,000, offered by Mutual of Omaha, Colonial Penn, and New York Life through AARP. 

A high maximum coverage amount is important for consumers to ensure they get all the financial protection they need from their policy.

Coverage for People with Diabetes

We scored this on a binary scale, awarding 1 point to companies that cover people with diabetes and 0 to companies that don’t.

Health status is a key factor in how much you pay for life insurance. If a life insurance company offers coverage for people with diabetes, it’s a sign that the insurer is flexible and inclusive when it comes to medical underwriting.

Offers Diabetes Management Tools

We scored this on a binary scale, awarding 1 point to companies that offer diabetes management tools and 0 to companies that don’t.

Diabetes management tools, which may help monitor blood glucose levels, medication adherence, and overall health, demonstrate a life insurer’s commitment to supporting the health of its policyholders.

Coverage for Cancer Survivors in Remission

We scored this on a binary scale, awarding 1 point to companies that offer regular (not no-exam or guaranteed issue) coverage to cancer survivors in remission and 0 to companies that don’t.

Cancer survivors often have difficulty securing life insurance coverage. If a life insurance company offers coverage for cancer survivors in remission, it’s a sign of that insurer’s flexibility and inclusiveness when it comes to medical underwriting.

Riders

It’s important to understand which riders are available to purchase and which are automatically included in your policy because it can help you better compare quotes and decide which policy best fits your needs.

For each company, we collected data on whether it offered the following types of riders:

• Spouse rider
• Guaranteed insurability rider
• Waiver of premium rider
• Disability income rider
• Accidental death benefit
• Terminal illness rider
• Long-term care rider
• Chronic illness rider
• Critical illness rider
• Child term rider

We awarded 1 point if the company offered the rider, and 0 points if it didn’t.   

We awarded an extra point (up to a total of four) for including the following riders at no additional cost:

• Terminal illness rider
• Long-term care rider
• Chronic illness rider
• Critical illness rider

Child Whole Life Maximum Coverage Amount

We scored this on a continuous scale of 0 to 1, with companies that had the highest maximum coverage amounts receiving a higher score and companies with a lower maximum term receiving a lower score. A few companies on our list offer child whole life policies with no specified maximum. These include Nationwide, MassMutual, and Penn Mutual. Globe Life offered the lowest maximum coverage amount, at $30,000.

A high maximum coverage amount is important for consumers to ensure they get all the financial protection they need from their policy.

Ability to Convert Child Term Rider to Permanent Coverage

We scored this on a binary scale, awarding 1 point to companies with child term riders that can be converted to a permanent policy and 0 to companies that don’t.

A convertible child term rider ensures that an insured child can continue to have coverage in the future, regardless of health changes.

Ability to Transfer Child Policy to Child at Adulthood

We scored this on a binary scale, awarding 1 point to companies that allow parents to transfer child policies to their children once they reach adulthood and 0 to companies that don’t.

Transferable child policies ensure that an insured child can continue to have coverage once they reach adulthood, regardless of health changes.

Child Term Rider Maximum Coverage Age

We scored this on a continuous scale of 0 to 1, with companies that had the highest coverage issue age receiving a higher score and companies with a lower coverage issue age receiving a lower score. Companies such as Protective, Banner, Transamerica, and USAA provide coverage through the child term rider up until age 25, the highest amount we recorded across 45 companies. Other companies—including Penn Mutual, Prudential, and State Farm—only covered children through the child term rider until age 17.

Higher coverage ages are important for consumers who want to maintain coverage for their children for as long as possible.

Child Term Rider Minimum Coverage Age

We scored this on a continuous scale of 0 to 1, with companies with the lowest coverage issue age receiving a higher score and companies with a higher minimum coverage issue age receiving a lower score. Most companies set a minimum coverage age of 15 days, though some, including Lafayette and Penn Mutual, can start coverage at birth or adoption.

Higher coverage ages are important for consumers who want to maintain coverage for their children for as long as possible.

Customer Satisfaction

A high frequency of complaints can indicate that an insurance company has problems responding to customer needs. The National Association of Insurance Commissioners (NAIC) is a regulatory organization that maintains a database of complaints filed against insurance companies. With this data, the NAIC creates an index that conveys how many complaints an insurance company has received relative to how many complaints it’s expected to receive based on its market share. We averaged each company’s NAIC index over three years.

If a company receives fewer complaints than expected, its index is less than 1. An index of 0 means the company received no complaints. An index greater than 1 means the company received more complaints than expected. Some examples of types of complaints are delays in benefit payment, poor claim handling, and claim denials.

Using the NAIC Complaint Index, we calculated a three-year weighted average NAIC score for each company’s total premiums and index values from 2021-2023. Our three-year average was scored on a continuous scale from 0 to 1, where the company with the lowest NAIC index, Northwestern Mutual, received a score of 1, and the one with the highest, Mutual Trust Life Solutions, received a score of 0. Thrivent, MassMutual, Pacific Life, and Guardian also stood out for their strong customer satisfaction scores.

J.D. Power

We also considered J.D. Power’s customer satisfaction scores and rankings for individual life insurance companies. The consumer insights firm surveyed 5,588 individual life insurance customers for its 2023 study. We did not score the results because they did not cover all the companies in our review, but we took them into account for editorial purposes.

Cost

Comparing quoted premiums across different insurers helps identify which companies offer the most cost-effective coverage for the desired policy type and amount. 

We researched quotes from each company for men and women in different age groups in excellent health for a $250,000, 30-year term policy. We used the following factors to run quotes for six different sample applicants:

• ZIP codes: 90011 and 77084
• Birthdays: Nov. 1, 1999, 1984, and 1969 (ages 25, 40, and 55)
• Health: Exceptional
• Nonsmokers
• No medications
• No negative family health history
• 30-year term
• Coverage amount of $250,000

For each unique persona, we scored premium values on a range from 0 to 1 (0 being the most expensive policies; 1 being the least expensive). For each company, we averaged the scores across all personas to create a composite cost score.

We used a separate sample for older adults (ages 55 and 65), since they face more difficulty getting affordable coverage and are likely to get shorter terms:

• ZIP codes: 90011 and 77084
• Birthdays: Nov. 1, 1969 and 1959
• Health: Exceptional
• Nonsmokers
• No medications
• No negative family health history
• Length of coverage: 20-year-term for 1969 birth year, 15-year term for 1959 birth year
• Coverage amount: $250,000

Articles That Use Our Methodology

Life insurance is an essential financial topic for our readers, and we’ve written extensively about it. We have articles about the best life insurance companies for specific products or to meet the needs of particular readers. 

The research conducted and the data collected to create this methodology have been used to compile the following list of recommendations:

• Best Life Insurance Companies
• Best Term Life Insurance Companies
• Best Whole Life Insurance Companies
• Best Universal Life Insurance Companies
• Best Life Insurance Companies for People Over 50
• Best No-Medical-Exam Life Insurance
• Best Children’s Life Insurance Companies

Meet the Life Insurance Research & Reviews Team

Read the original article on Investopedia.