The Best Life Insurance Companies

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Image Credit: Canva/Clark.com

Looking for the best life insurance? Simple is better when it comes to life insurance, and buying level term insurance from a trustworthy company is just about as simple as you can get.

In this article, we’ll take a look at what term life insurance is and who needs it. If you already know that you want to buy life insurance, skip ahead to read money expert Clark Howard’s recommendations and get his top three picks for the best term life insurance.

Best Life Insurance Companies: Table of Contents

What Is Level Term Life Insurance?

Do you have a family or someone else who depends on you financially? Life insurance is meant to replace your income when you’re gone.

Let’s break down some concepts in the phrase “level term life insurance” to get a better understanding of the policy.

The “term” part here means you buy insurance for a set number of years depending on your age and your family’s needs. Typically, that means for periods of either 20 or 30 years to protect your young children as you raise them into adulthood.

The “level” part means the premium remains the same for that number of years.

Remember the only purpose for life insurance is to replace your income (or your spouse’s) for your family if you die.

Fortunately, the cost of term life insurance has been dropping for a while.

“Life insurance has gotten much cheaper over the years, in part because people are living longer,” money expert Clark Howard says. “Add into the mix the internet, which has made it ultra-easy to compare prices when shopping for life insurance. The result is that term life insurance costs have dropped by two-thirds in the last 15 years. That’s a great deal!”

Who Needs Life Insurance?

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Clark says there are several different situations where you’d want term life insurance.

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Say, for example, you have young kids and you want to provide financial security for them until they are adults. In this case, you might want to buy a 20-year term policy.

Or, let’s say you’re 35 and it’s just you and your spouse. You may want to provide for the remainder of your spouse’s life in the event of your death. In that case, you’d probably want a 30-year term policy.

Another instance you’d want term life insurance is if you’re a parent of an adult child with disabilities. That should be done in conjunction with a special needs trust.

Finally, you may not need a life insurance policy at all if there aren’t children in the picture.

“If you have no dependents at all, you don’t need to buy any life insurance,” Clark says. “And don’t ever buy insurance on children. A three-year-old doesn’t earn a salary, so there’s no need to replace his or her income.”

Clark Howard’s Picks for Term Life Insurance

Now that you know how Clark feels about life insurance, you might wonder who he’d buy it from.

Clark has long sung the praises of two insurers in particular — USAA and Amica Mutual — when it comes to term life insurance.

1. USAA

USAA logo

USAA is a diversified financial services company with offerings that include banking, investing and insurance.

While most of the services USAA offers are only available to those in the military, veterans or those who are affiliated with the military through direct family ties, the organization makes an exception for life insurance. It’s available to anyone — military or not!

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2. Amica Mutual

amica mutual logo

Another great company for term life insurance is Amica Mutual. Amica is often acknowledged in the industry as an equal to USAA for all kinds of insurance coverage.

In fact, Clark believes so strongly in USAA and Amica that he listed them both as top picks on his lists of the best auto insurance companies and best home insurance companies.

3. Haven Life

Haven Life logo

Haven Life is one of a handful of insurers that issues term life insurance policies with no medical exam.

When you go through Haven, select qualified applicants (up to age 45) can finalize coverage online without the need to have a physical exam or a blood test like you would with other insurers.

Certain candidates, however, may still need to pass medical underwriting, depending on a variety of factors.

In addition, you can see other providers of no medical exam term life insurance policies here.

Term Life Insurance Companies Ranked by Stability

Clark recommends buying only from companies that are rated A++ or A+ by A.M. Best — the highest possible ratings from one of the top companies when it comes to measuring the long-term financial strength of different insurers.

“Anything less than an A+, even an A, is unacceptable. Don’t be tempted by low premiums when you’re shopping around,” Clark says. “Stick with insurers of top strength, even if you have to pay more for it.”

You can visit AMBest.com to get started researching your insurance company of choice. Free registration is required to use the site.

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We’ve pulled up some ratings of popular life insurers below:

Insurance CompanyCoverage Underwritten ByA.M. Best Rating
Amica Mutual(self)A+
USAA(self)A++
Haven LifeMassachusetts Mutual Life Insurance CompanyA++
State Farm(self)A++
Prudential(self)A+
Mutual of Omaha Group(self)A+
Globe Life(self)A+
John Hancock(self)A+

Understanding an insurance company’s financial strength is of the utmost importance. You want to make sure a company you’re buying a policy from today will be around for the long haul when your family needs them.

Once you’ve got the financial stability piece of the puzzle figured out, then you’re really just shopping for coverage based on cost. Clark says that you should aim to buy 6 to 10 times your annual income in coverage.

“All else being equal, buy life insurance by cost,” Consumer Reports notes. “Shop for the lowest rates using an online broker with ties to many insurers, not just a few.”

Fortunately, shopping for term life insurance is easy on the internet. You can comparison shop for quotes at any of a number of sites like:

Final Thought

A lot of people shy away from buying life insurance simply because they don’t understand it. But buying term life insurance can be simple and affordable.

Remember, if you’ve got children or other financial dependents, you need life insurance!

Whatever you do, understand it’s term life insurance that Clark recommends — not whole life insurance. To get a sense of the difference between the two kinds of policies, read our explanation here.

Meanwhile, we’ve got a full guide that breaks down how to buy term life insurance right here.

More Insurance Stories on Clark.com: 

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