Best Whole Life Insurance Companies
Whole life insurance provides lifelong coverage with fixed premiums and a cash value component. Here are some of the best companies offering these policies:
Best for Couples: MassMutual
Key Features:
- Variety of term and permanent policies
- High customer satisfaction rankings
- Dividends paid annually since 1869
Best for Dividends: Northwestern Mutual
Northwestern Mutual Life Insurance
Key Features:
- Highly rated for customer satisfaction
- Dividends have been paid annually since 1872
- Standalone long-term-care policy and rider available
Best for Final Expense Coverage: Ethos
Ethos Life Insurance
Ethos offers term and permanent policies from various providers, including options for final expense coverage, which is designed to cover funeral costs and other end-of-life expenses. Ethos’ whole life plan doesn’t require a medical exam for coverage and has generous coverage limits.
Key Features:
- No medical exam
- Guaranteed acceptance option
- Instant coverage
- 100% online application
Best for Living Benefits: Guardian
Guardian Life Insurance
Key Features:
- Has paid dividends since 1868
- Whole life insurance policies up to age 90
- Available in all 50 states
Best for Payment Options: State Farm
State Farm Life Insurance
Key Features:
- Reasonable rates
- Top-rated for customer service
- Return of premium benefit available
- Term policies can be converted to permanent
How Whole Life Insurance Works
Whole life insurance is designed to provide lifelong coverage, guaranteed to pay out a death benefit as long as premiums are current. These policies also build a cash value, which grows tax-deferred and can be borrowed against or withdrawn.
Cost of Whole Life Insurance
The cost of whole life insurance is determined by factors like age, gender, and health. Due to their permanent nature, whole life policies are generally more expensive than term life insurance.
- A $500,000 whole life insurance policy for a healthy 30-year-old man averaged $472 per month in 2024.
- For a comparable female of the same age, the monthly premium was about $408.
- Rates increase for older policyholders.
How to Shop for Whole Life Insurance
When searching for the right policy, it’s important to take the following into consideration:
- Availability: Ensure the insurer offers coverage in your state.
- Coverage Limits: Determine the amount of coverage you need to meet your financial obligations.
- Riders: Riders can customize your coverage, such as accelerated death benefit riders.
- Dividends: Understand whether the policy is eligible for dividends, which can increase your coverage or offset your premiums.
- Customer Service: Select an insurer with a good reputation for customer service.
- Financial Strength: Consider the insurer’s financial strength rating from A.M. Best to assess their ability to pay out benefits.
Pros and Cons of Whole Life Insurance
Pros:
- Premiums remain fixed.
- Coverage lasts your entire life.
- Cash value grows tax-deferred.
- Policies may earn dividends.
Cons:
- More expensive than term life insurance.
- Limited control over cash value investments.
- Inability to adjust premiums in the future.
FAQs About Whole Life Insurance
- How much is whole life insurance? Due to its lifelong coverage, whole life insurance is more expensive than term life. A $500,000 whole life policy for a healthy 30-year-old man cost an average of $472 per month in 2024.
- What is the difference between term and whole life insurance? Term life provides coverage for a specified period, while whole life provides coverage for your lifetime. Term life is cheaper but doesn’t include a cash value component.
- When can I access the cash value in a whole life policy? The cash value typically becomes available a few years after the policy starts.
- Is whole life insurance worth it? It is a good option in certain situations, such as when you’re looking at long-term investment or have dependents that will always need support.
