Best whole life insurance companies of May 2024
“Verified by an expert” means that this article has been thoroughly reviewed and evaluated for accuracy.
“Verified by an expert” means that this article has been thoroughly reviewed and evaluated for accuracy.
BLUEPRINT
Updated 8:50 a.m. UTC April 30, 2024
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State Farm is the best whole life insurance company of 2024. The most cost-competitive whole life insurer in our analysis, State Farm has superior financial strength and offers policies that build cash value early on. State Farm also has a very low level of customer complaints to state insurance departments.
If you’re shopping for life-long coverage, also get life insurance quotes from Northwestern Mutual and Penn Mutual. Both are also top-scoring whole life insurance companies.
Ethos
The best whole life insurance companies of 2024
- State Farm: Best whole life insurance.
- Northwestern Mutual: Best for reliable policy illustrations.
- Penn Mutual: Best for historical portfolio performance.
Compare the best whole life insurance companies
| Whole life insurance company | AM Best financial strength rating | Whole life insurance rating | ||||
|---|---|---|---|---|---|---|
 State Farm | A++ (Superior) | |||||
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 Northwestern Mutual | A++ (Superior) | |||||
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 Penn Mutual | A+ (Superior) | |||||
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Why trust our life insurance experts
To help you find the best life insurance for your unique needs, our life insurance experts analyzed thousands of life insurance policies, evaluating data points that matter, such as rates, a company’s financial strength, policy features and customer complaints. We use a data-driven methodology to determine each rating. Advertisers do not influence our editorial content. You can read more about our methodology below.
- 9,000+ life insurance policies evaluated.
- 38 million data points analyzed.
- 5 levels of fact-checking.
Why it’s the best
State Farm has high financial strength ratings. Its whole life insurance policies are cost-competitive and can build cash earlier in the policy’s life, compared to other insurers we’ve analyzed. Combined, these factors earn it a 5.0-star rating and the title of best whole life insurance of 2024.
State Farm’s policy illustrations, which show how the anticipated cash value performance, are known to be very reliable. This means you have more dependable insights into how your cash value will perform over time.
Why it’s the best
Of the whole life insurance companies we evaluated, Northwestern Mutual has the most reliable policy illustrations. A reliable policy illustration makes it easier to see how your whole life insurance policy’s cash value will grow over time.
Northwestern Mutual takes a holistic, customizable approach to life insurance, making it easier to build and purchase a policy that meets your specific needs. As a policyholder, you have flexibility in how you pay your premiums and have the ability to earn returns on the cash value within a few years.
Why it’s the best
Penn Mutual’s long-term portfolio performance is strong, which bodes well for cash value growth. Its whole life insurance policy also has relatively low internal fees, so you keep more of your earnings.
Penn Mutual has several life insurance options, including top-ranking whole life insurance. It also offers eight universal life insurance policies with a range of funds and securities you can invest in with your cash value. You can choose a policy with less risk that protects your assets, but it also offers more aggressive options you can use to potentially grow your money faster.
Methodology
To determine the best whole life insurance companies, our life insurance experts evaluated data provided by Veralytic, an independent publisher of life insurance research and analytics.
Each life insurance company included in our evaluation had the opportunity to earn up to 100 points, based on the following factors.
What is whole life insurance?
Whole life insurance is a permanent life insurance policy with the following features:
- Coverage that lasts your lifetime, as long as you pay your premiums.
- A guaranteed premium, meaning your payments won’t go up over time.
- Guaranteed death benefit, or the sum paid out to a beneficiary after a claim.
- Cash value you can access while alive.
- Guaranteed rate of return on the cash value account.
5 tips for choosing the best whole life insurance company
If you’re thinking of purchasing a whole life insurance policy, here are a few key tips to ensure you find the best whole life insurance.
1. Decide how much whole life insurance you need. Alison Salka, Ph.D., senior vice president and director of research at LIMRA, suggests the best place to start is by understanding your financial goals. Ask yourself what you want this product to accomplish for you, such as replacing an income, covering final expenses or leaving behind an inheritance.
2. Work with a financial professional. You can start with a needs assessment on your own, but Salka recommends working with a financial professional who can take a holistic look at your entire financial picture to see how life insurance fits. That’s particularly true for permanent life insurance products, she says, since they can be more complex than term life insurance.
3. Compare whole life insurance quotes, making sure to request life insurance quotes for the same type and amount of coverage. Some whole life insurance companies offer online quotes, though you may need to speak directly with an agent to complete the quote process.
Expert Tip: Don’t limit your comparison to whole life insurance rates. For a true comparison, include any internal fees charged by the life insurance company. These fees can reduce the portion of your premium that goes toward the cash value of your policy, slowing growth.
4. Evaluate whole life insurance companies. Check online expert reviews and consumer reviews. You can also check each insurer’s financial strength by reviewing ratings from credit rating agencies such as AM Best and Standard & Poor’s (S&P). Financial strength ratings indicate how likely an insurer is to pay out claims.
5. Compare policy features and benefits. If you’re having trouble narrowing down your whole life insurance options, even after comparing rates and fees, take note of any features and benefits available. For instance, one whole life insurance company may include riders, or coverage add-ons, with a policy while another may charge an additional fee for the same riders.
Whole life insurance: Pros and cons
Before you buy a whole life insurance policy, consider these benefits and drawbacks.
| PROS | CONS |
|---|---|
Provides coverage for your lifetime, as long as you pay your premiums
| More expensive than term life insurance. It also can be more expensive than other types of permanent life insurance, such as universal life
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Usually includes a cash value component with a guaranteed rate of return
| Other permanent life insurance products, like indexed universal life insurance, may offer higher cash growth potential, though that may come with increased risk
|
You can access your policy’s cash value while you’re alive by taking a loan against it, surrendering the policy or using the cash value to cover your premiums
| Using the cash value can impact your beneficiary’s death benefit. For example, if you die without repaying a cash value loan, the death benefit will be reduced
|
How much does whole life insurance cost?
For a healthy, 30-year-old woman, a $250,000 whole life insurance policy costs an average of $180 per month, or $2,160 per year. If the same policy is purchased by the same female at age 40, it will cost an average of $262 per month, or $3,144 per year.
A healthy 30-year-old male has an average rate of $201 per month, or $2,412 per year for the same policy. At 40, the male will pay an average of $293 per month, or $3,516 per year.
Whole life insurance rates increase as you age. Rates will also increase if you are diagnosed with certain medical conditions, such as diabetes, high blood pressure or cardiovascular disease.
The table below can help you get an idea of how much life insurance costs by your age, coverage amount and gender.
Average monthly whole life insurance rates
| WHOLE LIFE INSURANCE BUYER | $250,000 IN COVERAGE | $500,000 IN COVERAGE | $1,000,000 IN COVERAGE |
|---|---|---|---|
Female, 30
| $180
| $352
| $697
|
Female, 40
| $262
| $506
| $1,005
|
Female, 50
| $387
| $752
| $1,496
|
Male, 30
| $201
| $394
| $781
|
Male, 40
| $293
| $564
| $1,121
|
Male, 50
| $445
| $847
| $1,686
|
Factors that impact the price of whole life insurance
How much you’ll pay for whole life insurance will depend on several factors, including your:
- Age and gender.
- Height and weight.
- Medical history.
- Medical history of your parents and siblings.
- Prescription history.
- Nicotine and marijuana use status.
- Substance abuse.
- Credit history.
- Desired amount of whole life insurance.
- Add-ons or riders selected.
- Hobbies or profession, if considered high-risk.
- Driving record, especially high-risk risk offenses like DUIs or speeding tickets.
Expert Tip: Policy premiums only tell a part of the life insurance “cost” story. The true cost of a policy includes:
- The cost for an insurer to provide whole life insurance.
- Internal policy costs.
- The portion of your premium that goes toward your cash value account.
When you’re considering the cost of a whole life insurance policy, make a true comparison by asking your insurer for a detailed expense page so you can compare other key factors, like internal fees.
How much whole life insurance do I need?
Your whole life insurance coverage needs are unique to your financial situation and your reasons for wanting coverage. There are several considerations that can help you determine how much coverage you need, including:
- How much of your salary you’d want to replace and for how long.
- Any debts you want to be covered, such as a mortgage, child care expenses or tuition.
- End-of-life expenses you want to be covered, such as the cost of a funeral.
- Any intention to use life insurance as an inheritance or trust.
- Existing assets, such as savings or retirement accounts that may reduce your whole life insurance needs.
How to choose the best whole life insurance company
If you’re thinking of purchasing a whole life insurance policy, there are a few key steps you can take to ensure you find the best policy and plan.
1. Decide how much whole life insurance coverage you need. Alison Salka, Ph.D., senior vice president and director of research at LIMRA, suggests the best place to start is by understanding what your financial goals are. Ask yourself what you want this product to accomplish for you.
You can start with a needs assessment on your own, but Salka recommends working with a financial professional who can take a holistic look at your entire financial picture to see how life insurance fits. That’s particularly true for permanent life insurance products, she says, since they can be more complex than term life insurance.
As mentioned above, there are several factors that dictate how much whole life insurance you need, including your income replacement goals, existing debts, existing assets and any other intentions you may have for the death benefit, such as covering a child’s tuition or your funeral expenses.
2. Evaluate insurance companies. Doing online research is a great way to start your search. You can also reach out to friends and family or a financial expert for feedback and recommendations.
Once you have a list of potential insurers, turn to websites like AM Best to check each whole life insurance company’s financial strength rating, which will tell you the likelihood of a company being able to pay out on a life insurance claim.
3. Get and compare life insurance quotes. Get quotes from each whole life insurance company on your shortlist, making sure to request quotes for the same type and amount of coverage.
Some whole life insurance companies offer online quotes, though you may need to speak directly with an agent to complete the quote process.
Don’t stop at comparing whole life insurance rates, however. Extend your comparison to include any internal fees charged by the life insurance company, as these can reduce the portion of your premium that goes toward the cash value of your policy.
4. Compare policy features and benefits. If you’re having a tough time narrowing down your options, even after comparing rates and fees, take note of any features and benefits available. One whole life insurance company may include some add-ons with a policy while another might charge an additional fee for the same riders.
Alternatives to whole life insurance
Whole life insurance isn’t for everyone, and there are plenty of alternatives that may better suit your financial needs or long-term goals. Here are a few options worth considering.
- Other permanent life insurance products. Universal life, variable life and other similar products provide lifelong coverage and a cash value component.
- Term life insurance. You may want to consider choosing term life insurance if you only want to lock in your life insurance rates for a specific amount of time, you have a limited budget or you have other investment vehicles your loved ones can rely on after your death.
- Traditional or Roth IRAs. These individual retirement accounts allow you to save up to $7,000 ($8,000 if you’re 50 or older) annually, according to current IRA contribution limits. The account is designed to accommodate your financial needs during retirement, but you can name a beneficiary who could receive the funds and then use them much like they would a life insurance death benefit.
- Employer-sponsored 401(k) plans. Like IRAs, a 401(k) caters to your retirement needs but the funds can be left to a beneficiary if you die before depleting the account. The beneficiary can use these funds to cover expenses as needed.
- Fixed annuities. Fixed annuities are investment accounts that offer a specific rate of return and stream of income during your retirement years. Like other retirement accounts, the funds can be left to a beneficiary to use as a death benefit.
Best whole life insurance FAQs
When you purchase a whole life insurance policy, you make premium payments in exchange for coverage that will last your lifetime. In most cases, a whole life insurance policy also includes a cash value component.
If you die and your policy is in good standing — meaning your premium payments are current — your beneficiary will receive a guaranteed death benefit. You can choose more than one beneficiary to receive the death benefit and dictate how the benefit is divided. For instance, you could leave your spouse 50% of the death benefit and two children 25% each.
The cash value of your whole life insurance policy will accumulate over time according to the policy’s guaranteed rate of return. When enough accumulates, you may be able to use it to cover your premium payments or borrow against, depending on your policy terms.
State Farm has the best whole life insurance, based on our analysis of whole life insurance companies. To determine the best whole life insurance company, we evaluated multiple top permanent life insurance companies based on their financial strength, cost competitiveness, reliability of policy illustrations and cost competitiveness.
Northwestern Mutual and Penn Mutual also receive top scores in our whole life insurance ranking.
Whole life insurance is best if you want a policy that doesn’t expire — as long as you pay your premiums — and offers an additional savings vehicle.
In addition to common reasons to purchase life insurance, such as replacing an income for loved ones or covering larger debts, such as a mortgage, a whole life insurance policy can:
- Cover end-of-life expenses, such as funeral costs.
- Cover estate taxes, especially if your estate exceeds the federal estate tax or you live in a state with lower state tax limits.
- Build a trust or inheritance to provide for your children after you die or leave them with a lump sum of cash as an inheritance.
- Create a business continuity plan.
Whole life insurance also may not be the right choice if you’re only looking for life insurance coverage for a specific period, such as until children finish school. In that case, a term life insurance policy may be a better, more affordable option.
Whole life insurance pays a death benefit for your beneficiaries when you die, no matter your age, as long as you are current on your payments. In addition, whole life insurance also has a cash value component that you can withdraw or borrow from while you’re alive.
Term life insurance allows you to lock in your premiums for a set amount of time, or term. Your beneficiaries will only receive the death benefit if you die with that term unless you renew your policy or convert it to a permanent life insurance policy.
Yes, in most cases you can still get life insurance if you’ve had COVID-19. But your premiums may be affected. This is particularly true if you have an underlying condition that can worsen after a COVID infection or one that was triggered by your bout with the virus.
Cash value is the savings component of a permanent life insurance policy. When you purchase cash value life insurance, a portion of your premiums will go toward the cash value account. The cash value grows over time, and you can access it while you’re alive.
Cash value growth depends on the type of life insurance policy you have. The cash value of a whole life insurance policy grows at the fixed rate of return determined by the insurer. If you have a variable life insurance policy, you make decisions about how the money is invested, and the account can grow or decrease based on how those investments perform.
It’s best to buy whole life insurance when you are younger, such as in your 20s or 30s, as you’ll be able to secure lower rates. For instance, a 30-year-old woman pays an average of $180 for a $250,000 whole life insurance policy, while a 40-year-old pays an average of $262 for the same amount of coverage.
The best way to decide between a term life insurance and a whole life insurance policy is to examine your budget and reason for purchasing coverage.
A term life insurance policy will likely be more affordable if you’re on a tight budget but want to secure some type of life insurance coverage. Term life insurance is also a good option if you want to maintain coverage for a specific period, such as until a child graduates from school.
A whole life insurance policy is a better option if you want coverage that will last your lifetime or if you simply don’t want to worry about renewing your policy. It’s also a better option if you want access to a cash value component that you can access while you’re alive.
For a $250,000 whole life policy, a 30-year-old woman can expect to pay $180 per month and a 30-year-old man will pay $201 per month on average.
Yes, you can usually take a tax-free loan from the cash value of your whole life insurance policy.
Loans from your policy need to be repaid, with interest. Failure to do so will reduce the death benefit.
Single premium whole life insurance is a type of life insurance policy that requires a single premium payment. Instead of making regular payments, such as monthly, you pay for the policy in full, up front.
Whole life insurance may be worth it if you want coverage for life and a cash value component that grows tax-deferred and can be tapped into while you’re alive.
If a cash value component is important to you but you want more control over how it grows, consider other permanent life insurance policy types, such as variable life insurance or universal life insurance.
If you only want life insurance coverage for a certain amount of time, such as 20 or 30 years, consider a term life insurance policy. Term policies are generally cheaper than permanent life insurance options, though they don’t carry a cash value component.
Learn more about life insurance
Blueprint is an independent publisher and comparison service, not an investment advisor. The information provided is for educational purposes only and we encourage you to seek personalized advice from qualified professionals regarding specific financial decisions. Past performance is not indicative of future results.
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