The 10 Best Term Life Insurance Companies In 2023

What Is it?

Term life insurance, as the name suggests, is life insurance for a specified term. As soon as the term expires, the insurance ends.

You may have the option to renew at a higher premium or convert it to a whole life policy, depending on the written terms.

This is the least expensive form of life insurance and it offers financial protection for a limited time.

It’s most common for young adults and young families to protect themselves should the unexpected happen, but some term policies allow applicants up to age 75 – 80 years old.

Whole Vs Term Life Insurance

Whole life insurance works a little different than term life insurance, although they have one similarity – the death benefit.

Both policies have a death benefit, which is what your beneficiaries receive upon your death. That’s where the similarities end, though.

Whole life insurance has a death benefit for your entire life – it doesn’t expire. In addition to the death benefit, the insurance policy has a cash component.

The cash component

A portion of the premiums you pay (they are much higher than term life insurance premiums), gets paid into your cash value which accrues interest over time.

You can only use the cash value of your policy while you are alive – your beneficiaries don’t receive this benefit upon your death. Instead, it offsets the amount of benefit the insurance company must payout should you die.

However, you are free to use the cash value of your policy while you are alive by either withdrawing funds or taking a loan against them depending on your policy’s requirements.

Pros & Cons

Pros

Inexpensive

Because of the limited term of insurance coverage, term life insurance often has the most affordable premiums.

Straightforward

Term life insurance is easy to understand. You choose a coverage amount and a term. If you die within that term, your beneficiaries receive the coverage amount.

If you are alive at the end of the term, the policy expires.

Flexible

At the end of the term, you may be able to renew it or convert it. If you renew it, you may not need a medical exam, but you will pay higher premiums due to your older age.

You might also be able to convert it to a whole life policy without losing your coverage but at a higher premium. You can also cancel term life insurance at any time.

Tax Incentives

Beneficiaries typically don’t have to pay taxes on the payout from your life insurance, which gives them more money to cover your final expenses and their own cost of living upon your death.

Cons

Limited coverage

Since the coverage isn’t for your lifetime, it’s hard to choose what term is best. It’s like predicting your death – no one can do that. If you outlive the policy, you have to decide how to proceed.

Premium increases

If you don’t have a level term policy, your premiums can increase annually. As you get older, the premium increases could be steep.

Inflexible

Once you choose a policy, that’s it. You can’t change it, borrow from it, or even using a cash value to cover your premiums while you are out of a job.

You must pay your premiums monthly to keep your coverage.

May expire

If you are still alive at the end of the term life insurance term, your policy can expire unless you take steps to renew it or convert it before that point.

No capital build-up

Term life insurance policies have no cash value. If you are alive at the end of the term, you don’t see any of the premiums you paid into it – the policy just expires.

Costs & Premiums

Rates

Term life insurance rates are typically affordable. They vary based on your age, health, gender, lifestyle, and the coverage amount.

For example, a healthy 30-year female would pay $11 a month for $250,000 in coverage and a healthy 30-year old male would pay $12.50 per month for the same coverage.

Riders

Riders are extra coverage you can add to your policy. They cost more but give you more benefits.

A few examples of riders include:

• Accelerated death benefit which gives you access to your benefit if you become chronically ill.
• Waiver of premium for disabilities which eliminates your premiums if you become disabled.
• Accidental death which doubles or triples your benefit if your death is accidental.

Age

Your age plays a vital role in the costs. The older you are the more likely you are to die – it’s just natural.

Because insurance companies base your premiums on the likelihood of a payout, your premiums increase as you age.

Health

Typically term life insurance companies don’t require a full medical exam.

But you do have to answer basic health questions and you may need a quick exam that includes taking your vitals and some bloodwork.

The better health that you are in and the fewer chronic issues you have, the lower the premiums you’ll pay.

Gender

Women tend to live longer and be slightly healthier, so they often have lower term life insurance rates than men, including healthy men.

Average for men

The average 30-year-old man pays $18 per month for a $250,000 policy with 30-year coverage, and the average 40-year-old man pays $28 per month for a $250,000 policy with 30-year coverage.

Average for women

The average 30-year-old woman pays $16 per month for a $250,000 policy with 30-year coverage, and the average 40-year-old woman pays $23 per month for a $250,000 policy with 30-year coverage.

Best Term Life Insurance Companies

Northwestern Mutual

What We Like

Northwestern Mutual offers competitive rates, especially for smokers and older applicants. They are one of the largest life insurance companies today and have an A++ AM Best rating.

They offer term conversion options and even offer dividend payouts plus level term policies that allow predictable premiums for the entire term.

What We Don’t Like

You may have to undergo a medical exam, as they are tough with their underwriting requirements. Speaking of underwriting, it does take a while with Northwestern Mutual, which can be frustrating.

You also have to talk to a representative to secure the insurance, which often means pressure to purchase a whole life policy at much higher rates.

Policies Available

Northwestern Mutual offers a variety of policies including:

• Level Term 20 – You pay the same premiums for 20 years. After the end of 20 years, the policy expires.
• Level Term 10 – This is a 20-year policy, broken into two policies. For the first 10 years, your premiums don’t change. In the next 10 years, the premiums will increase depending on your age at the time.
• Term 80 – You renew this policy annually. The rates are the same for one year, each year you renew, they increase. You can renew up until 80-years old.
• Term – 10 – You renew this policy annually. The rates are the same for one year, and each year you renew they increase. You can renew for up to 10 years.

The Verdict

Northwestern Mutual offers a variety of term life insurance policies at competitive rates. They are a financially secure company that always pays out on their policies.

They do have some negative customer reviews, but every insurance company has its complaints.

New York Life

What We Like

New York Life offers a variety of term life insurance policies that you can convert to whole life policies within the first 10 years.

They all (except the one-year non-renewable term), can be renewed up until age 90, if needed.

We also like the Family Protection Term, which offers coverage for all family members starting at $10,000 for children and $100,000 for adults. New York Life has an A++ rating with AM Best.

What We Don’t Like

New York Life doesn’t have an app – you have to log onto their website to conduct business online, including paying your premiums.

They don’t offer quotes online either, which makes the process a bit tedious. We also don’t like that each of their policies ’ premiums increases annually.

Policies Available

• One-year non-renewable term – You pay one premium, but the policy expires after one year.
• Yearly convertible term – Your premiums increase each year based on your age. You can renew until you are 90-years old. You can convert to a permanent policy at any point.
• Level convertible term – You get level premiums for 5, 10, or 20 years based on what you choose. The premiums then increase annually, but you can renew until age 90.
• Family protection term – You pay level premiums for 10 years. You can renew up until age 90 and premiums increase annually.

The Verdict

If you’re looking for a reputable insurance company that has a long history, New York Life is it. As with any insurance policy, we do suggest that you shop around to find the best deal.

While New York Life is one of the few to offer a one-year non-renewable policy, their remaining policies can get costly with the increasing premiums.

MassMutual

What We Like

Mass Mutual offers simple online applications and online quoting for their Direct Term policy, which makes shopping around for insurance easy.

They offer great rates for those in good health and each of their term life policies are guaranteed level, so the premiums don’t increase each year or ever.

They also offer a large selection of terms and coverage options that range from $100,000 to $10 million.

What We Don’t Like

The premiums can be rather high for those with pre-existing conditions or that smoke.

If you don’t qualify for the Direct Term policy, you’ll have to deal with an insurance agent and underwriting to get your policy.

Policies Available

• Direct Term – You apply for the policy online and don’t have to undergo a medical exam. You can get coverage for 10, 20, or 30 years but may only get coverage up to $2 million.
• Vantage Term – You can get a 10, 15, 20, 25, or 30-year policy through an insurance agent renewable at the end of the term if you wish. You could also convert this policy to a whole life policy.

The Verdict

If you’re healthy and relatively young, Mass Mutual offers great rates, especially if you fit into the Direct Term policies.

If you need more robust coverage, you may want to shop around to find the best rates, especially if you’re older or a smoker. Mass Mutual is financially stable and has an A++ AM Best rating.

John Hancock

What We Like

John Hancock offers affordable term life policies and has flexible guidelines.

You can get online quotes and even get premium discounts for certain lifestyle habits, such as wearing a Fitbit. They also have a nice selection of riders and a rating of A+ with AM Best.

What We Don’t Like

John Hancock’s riders are rather limited and they don’t offer temporary policies for the time that you’re waiting for underwriting to go through.

They also don’t offer a lot of customization options, so if you want something other than the ‘normal’ coverage, it may be hard to find.

Policies Available

John Hancock offers term life insurance with terms of 10, 15, or 20 years. They offer coverage amounts starting at $25,000 and up to $65 million.

Any policy under $5 million can get an instant quote and even apply online. Polices over $5 million require in-person applications and underwriting.

The Verdict

John Hancock offers straightforward policies for those that don’t need more than $5 million in coverage and are in good health.

They have an A+ rating with AM Best and their customer service is top-notch. If your insurance needs are simple, they offer good options.

Transamerica

What We Like

Transamerica has been providing life insurance for more than 100 years and they have an A+ AM Best rating.

They offer competitive rates and many policies don’t need any type of medical exam, especially if you are under 70 years old and need less than $100,000 in coverage.

Transamerica even offers competitive rates for smokers and those with cancer.

What We Don’t Like

They aren’t the most user-friendly when it comes to managing your account online, which can be frustrating.

The underwriting process overall is somewhat slow and tedious and a majority of the contact must be done via mail rather than online.

Policies Available

• Transamerica Trendsetter Super – Offers up to $10 million in coverage and is convertible to a whole life policy before the end of the term
• Trendsetter LB – This term life insurance policy has living benefits. You can get coverage up to $2 million and can access some of your policy if you become chronically ill.

The Verdict

Transamerica offers a simplified process with simple policies to choose from. Their rates are competitive and they are a trusted name in the insurance business.

State Farm

What We Like

State Farm has competitive rates and they’re a long-standing, successful insurance company.

They offer fast quotes and approvals through their online portal and they have an A++ rating from AM Best.

All policies have level premiums. Each policy offers the chance to buy a waiver of premium for disability rider.

What We Don’t Like

Rates for smokers are fairly high and you can’t get quotes for most policies online, which requires you to talk to an agent.

Policies Available

• Select Term – Coverage for 10, 20, or 30 years starting at $100,000.
• Return of Premium – Coverage for 20 or 30 years, starting at $100,000, but you can get your premiums returned if you’re still alive at the end of the term (premiums are higher).
• Instant Answer – Up to $50,000 in coverage with a term of 10 years or until you turn 50 (whichever occurs first) it is meant to be used as final expense insurance.

The Verdict

State Farm is a financially stable, long-standing insurance company that offers a variety of options including a large number of riders should you need them.

They have competitive rates if you’re in great health, and also offer policies for those in less than perfect health and smokers.

AIG

What We Like

AIG is among the most flexible life insurance company available today. They may not have the lowest premiums, but their customization options can’t be beaten.

They offer a wide number of riders including accidental death, child rider, terminal illness rider, and disability waiver of premium.

What We Don’t Like

AIG has a large number of customer complaints, so make sure to do your research before choosing them.

They also don’t offer online quotes or online applications, everything must go through an agent.

Policies Available

• Select-a-term Level Premium – Choose from terms starting at 10 years to 35 years. Each term includes the option to convert it into a whole life policy within a specified period based on the term. The premiums remain level as long as it’s a term life policy.
• QoL Flex Term – With coverage starting at $100,000, this policy allows you to use some of the benefits as living benefits should you become ill. Policies up to $1 million are available.

The Verdict

AIG offers a variety of options for consumers, but they have less than optimal customer service ratings.

Without an online option, you must deal with an insurance agent, but you can choose your own agent, which makes the process a little easier should you find that you don’t bond well with one or the other.

Protective Life Insurance

What We Like

Protective Life offers some of the lowest premiums for term life insurance and they offer online application capabilities, which is great for those that don’t want to deal with an agent.

They also offer a nice selection of riders and the policies all have level premiums.

What We Don’t Like

The rates for smokers are relatively high plus your death benefit decreases if you decide to renew your policy after the term expires.

This keeps your premiums the same but gives you less coverage for the same amount of money.

Policies Available

Protective offers one term life insurance policy, the Protective Classic Choice offers guaranteed level premiums for the life of the policy.

You can also renew it at the end if you wish, and for the same premiums, just lower coverage. You can buy policies of 10, 15, 20, 25, and 30 years for $100,000 to $50 million.

The Verdict

Protective Life Insurance is a quality and financially stable company with an A+ AM Best rating.

They offer affordable premiums and customizable options, making it an affordable way for many to get term life insurance.

Bestow Life Insurance

What We Like

If you love dealing with online insurance companies, you’ll love Bestow Life Insurance. They offer affordable premiums and their entire process is done online.

Many people get approved through Bestow as long as they don’t have the ‘major’ illnesses asked in the questionnaire including heart disease and cancer.

Bestow also offers what they call ‘fast life insurance.’

What We Don’t Like

Bestow only covers applicants ages 21 to 55, so if you’re older, they aren’t an option for you.

They also don’t offer a 30-year policy, the longest term they offer is 20 years and they don’t have additional riders.

Policies Available

Bestow currently offers 10 and 20-year term life policies in coverage amounts of $50,000 to $1,000,000.

The Verdict

Bestow is a good option if you are in good health and have flexible life insurance needs. You must be young and relatively healthy to get this ‘fast insurance.’

If you’re looking for long-term policies or those that are renewable or convertible, you may want to look elsewhere.

Nationwide Term Life Insurance

What we Like

Nationwide is one of the largest life insurance companies in the United States. They offer customizable options to meet the needs of anyone.

Their policies have level monthly premiums and they offer a large number of riders including accelerated death benefit and premium waiver riders.

What We Don’t Like

If you have diabetes or other pre-existing conditions, the premiums may be much higher than the competition.

Nationwide also doesn’t offer a lot of online options, forcing you to speak to a representative to apply for life insurance.

Policies Available

Nationwide offers term life policies of 10, 15, 20, and 30-year terms. Coverage starts at $100,000 and you can renew your policies up until age 95 if necessary.

The Verdict

Nationwide offers a viable life insurance product that is affordable if you are in good health. They are a financially stable company that has been around for many years.

It’s worth shopping around to compare rates, but Nationwide does offer a great product.