Best Whole Life Insurance Companies: Expert-Rated In 2023

Whole life insurance can be attractive to life insurance buyers who want guarantees. This type of life insurance guarantees that your annual premiums won’t change, you’ll have reliable cash value growth, and the death benefit amount won’t change.

To help you find the best whole life insurance companies, we’ve evaluated life insurers based on key metrics over time for their whole life insurance policies.

The Best Whole Life Insurance Companies

Here are our top picks for the best whole life insurance policies:

Northwestern Mutual

Ohio National

State Farm

Penn Mutual

Guardian

MassMutual

New York Life

Northwestern Mutual

Why We Picked It

Northwestern Mutual provides a superior combination of high ratings for financial strength and good pricing on whole life insurance for many ages and health risks. The company also has whole life insurance policies that can build cash value well in the early years.

More Details

Types of Life Insurance Sold

Whole life

Variable universal life

Fixed-rate universal life

Term life

Life Insurance Riders Available

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Waiver of Premium Benefit (whole life only)

Waiver of Selected Premium Amount (universal life only)

Additional Purchase Benefit

Accelerated Care Benefit

Availability of riders could depend on the type of policy.

Northwestern Mutual Quick Facts

Year established: 1858

Headquarters: Milwaukee, Wisconsin

How to buy: You must go through a Northwestern Mutual agent to buy the company’s life insurance products

Ohio National

Why We Picked It

Ohio National has had enviable performance from its investments. For whole life insurance customers this can translate to dividends that you can use to pay premiums sooner rather than later. It can also mean better growth of cash value if you choose to apply your dividend money there.

More Details

Types of Life Insurance Sold

Term life

Whole life

Universal life

Life Insurance Riders Available

Waiver of Premium Rider

Accelerated Care Benefit

Child Insurance Rider

Additional Insurance Rider

Overloan Protection Rider

Guaranteed Insurability Rider

Availability of riders could depend on the type of policy.

Ohio National Quick Facts

Year established: 1909

Headquarters: Cincinnati, Ohio

How to buy: Ohio National’s policies are sold through both independent brokers and agents who work for Ohio National.

State Farm

Why We Picked It

State Farm stands out from many competitors for its financial strength, which gives life insurance buyers confidence that the company will be able to meet its obligations many years down the road. Whole life insurance buyers can also benefit from State Farm’s highly reliable policy illustrations and cash value that builds well, even in the early years of the policy.

More Details

Types of Life Insurance Sold

Term life

Whole life

Universal life

Life Insurance Riders Available

Waiver of Premium Rider

Guaranteed Insurability Rider

Additional Insurance Rider

Child Insurance Rider

Waiver of Monthly Deduction

Accelerated Care Benefit

Availability of riders could depend on the type of policy.

State Farm Quick Facts

Year established: 1922

Headquarters: Bloomington, Illinois

How to buy: State Farm insurance is only available through State Farm agents, who won’t be comparing the rates or benefits from other companies for you.

Penn Mutual

Why We Picked It

Buyers of whole life insurance will appreciate Penn Mutual’s financial strength and its low internal costs, which means more money can go toward your cash value. Penn Mutual has been very good at investing its assets, which can result in better growth of cash value and death benefits and/or lower total premiums over the life of the policy.

More Details

Types of Life Insurance Sold

Term life

Whole life

Indexed universal life

Guaranteed universal life

Variable universal life

Life Insurance Riders Available

Accidental Death Benefit Rider

Additional Insurance Rider

Child Life Insurance Rider

Chronic Illness Rider

Disability Rider

Early/Enhanced Cash Value Rider

Estate Protection Rider

Guaranteed Insurability Rider

Lapse Protection Rider

Overloan Protection Rider

Return of Premium Rider

Spouse/Other Insured Rider

Terminal Illness Accelerated Death Benefit Rider

Waiver of Monthly Deduction Rider

Waiver of Premium Rider

Waiver of Surrender Charges Rider

Availability of riders could depend on the type of policy.

Penn Mutual Quick Facts

Year established: 1847

Headquarters: Horsham, Pennsylvania

How to buy: Penn Mutual life insurance is mostly sold through independent brokers but also available through insurance agents who sell only Penn Mutual products.

Guardian

Why We Picked It

Guardian life shines when it comes to financial strength, and its whole life insurance policies can build cash value well in the early years.

More Details

Types of Life Insurance Sold

Term life

Whole life

Universal life

Life Insurance Riders Available

Index Participation Feature

Terminal Illness Accelerated Benefit

Tax-Qualified LTC Rider

Chronic Illness Rider

Waiver of Premium

Guaranteed Insurability Option

Paid-Up Additions Rider

DuoGuard (survivor purchase option)

Term Blend Conversion

Availability of riders could depend on the type of policy.

Guardian Life Insurance Quick Facts

Year established: 1860

Headquarters: New York City

How to buy: Guardian Life Insurance policies are sold through a network of thousands of financial representatives.

MassMutual

Why We Picked It

MassMutual provides a good combination of high ratings for financial strength and cash value that builds well within its whole life insurance policies. Buyers can also benefit from good performance of the investments underlying policy cash values most of the time.

More Details

Types of Life Insurance Sold

Term life

Whole life

Some term life

Variable universal life

Life Insurance Riders Available

Terminal Illness Accelerated Death Benefit Rider

Disability Rider

Guaranteed Insurability Rider

Waiver of Premium Rider

Additional Insurance Rider

Early/Enhanced Cash Value Rider

Overloan Protection Rider

Long Term Care Rider

Estate Protection Rider

Lapse Protection Rider

Availability of riders could depend on the type of policy.

MassMutual Quick Facts

Year established: 1851

Headquarters: Springfield, Massachusetts

How to buy: MassMutual life insurance products are mostly available through agents who sell only MassMutual products, with some availability through financial advisors.

New York Life

Why We Picked It

New York Life provides a good combination of top-notch financial strength and whole life insurance policies in which cash value often builds well early. Whole life insurance buyers will also find generally reliable illustrations.

Why We Picked It

New York Life provides a good combination of top-notch financial strength and whole life insurance policies in which cash value often builds well early. Whole life insurance buyers will also find generally reliable illustrations.

More Details

Types of Life Insurance Sold

Term life

Whole life

Universal life

Variable universal life

Life Insurance Riders Available

Terminal Illness Accelerated Death Benefit Rider

Additional Insurance Rider

Waiver of Monthly Deduction Rider

Long Term Care Rider

Accidental Death Benefit Rider

Waiver of Premium Rider

Child Insurance Rider

Lapse Protection Rider

Return of Premium Rider

Spouse/Other Insured Rider

Guaranteed Insurability Rider

Overloan Protection Rider

Option to Split/Change/Convert Rider

Availability of riders could depend on the type of policy.

New York Life Quick Facts

Year established: 1845

Headquarters: New York City

How to buy: New York Life policies are almost exclusively available through agents who sell only New York Life products with a little availability through financial advisors.

Summary: Best Whole Life Insurance Company Ratings

Northwestern Mutual earns the top spot in our ranking of the best whole life insurance companies. Whole life insurance from Ohio National and State Farm also topped our rankings.

What Is Whole Life Insurance?

Whole life insurance is a type of permanent life insurance designed for people with low risk tolerance and who want lifelong coverage with guaranteed premiums, death benefit and cash value growth.

Whole life insurance is one of the oldest forms of life insurance. For most of the 1900s, it was the most common form of life insurance in the United States. It continues to be popular today and represents 33% of total life insurance premiums, according to LIMRA, an industry-funded research group

How Does Whole Life Insurance Work?

A whole life insurance policy remains in force for the rest of your life as long as you pay the premiums. Before buying a whole life insurance policy, understand its cash value, living benefits, death benefits and dividends.

What is whole life insurance cash value?

Each time you make a premium payment for a whole life insurance policy, part of that premium is put into a cash value account. The remainder of the premium goes to paying internal policy expenses.

The cash value account grows tax-deferred, based on a guaranteed rate of return that is typically low compared to other types of permanent life insurance. Because of slow growth, it can take a long time before the cash value surpasses what you’ve paid in premiums.

You can choose to tap into your cash value by making a withdrawal, taking a life insurance policy loan or surrendering the policy. Withdrawals will reduce the death benefit your beneficiaries will receive. So will a policy loan if it’s not paid back.

What are whole life insurance living benefits?

Whole life insurance policies generally offer living benefits. Living benefits allow you to access money in your own death benefit while you’re still living, under specific circumstances.

The most common living benefits let you access your own death benefit money for long-term chronic illness or terminal illness (called an accelerated death benefit). Make sure you ask your insurance agent what living benefits are available before you buy the policy.

What are whole life insurance death benefits?

What are whole life insurance death benefits?

When you buy a whole life policy, you’ll list a life insurance beneficiary (or multiple beneficiaries) who will receive the death benefit payout when you die. You should also list contingent beneficiaries who will receive the payout if your primary beneficiaries are already deceased.

It’s important to know that whole life insurance has a guaranteed death benefit amount (the policy’s face value), but that amount does not include the cash value in the policy, no matter how much you’ve accumulated. Some policies offer a rider that will add the cash value to the face value for the death benefit, but expect to pay more for this feature.

What are whole life insurance dividends?

Dividends are common on whole life insurance policies. “Participating” whole life insurance policies pay a dividend and are offered by mutual insurance companies. “Non-participating” whole life insurance policies do not pay a dividend and are offered by stock insurance companies.

You’ll typically have a choice of how to use your dividends. Common options include:

Taking the dividend as cash

Putting it toward your life insurance premiums

Purchasing paid-up additions

Purchasing paid-up additions will increase the cash value and death benefit. If you have a policy loan out, dividends can be used to pay loan interest and to pay back the loan. Insurance companies may offer other dividend options.

Cost of Whole Life Insurance

The average cost of whole life insurance is $180 a month for a $250,000 policy for a 30-year-old female, and $201 a month for a 30-year-old male.

Average monthly cost for a $500,000 whole life insurance policy

The average cost of whole life insurance is $352 a month for a $500,000 policy for a 30-year-old female, and $394 a month for a 30-year-old male.

you pay annually instead of monthly for a life insurance policy, you can receive a small price break.

Factors that affect the cost of whole life insurance

The coverage amount you select will have a large impact on your premium. Other factors that typically affect whole life insurance premiums include:

Age and gender

Height and weight

Past and current health conditions

The health history of your parents and siblings

Nicotine and marijuana use, including nicotine patches and gum

Substance abuse

Credit

Criminal history (such as felonies)

Driving record (especially DUI convictions and moving violations, such as speeding tickets)

Dangerous hobbies and activities (such as piloting planes)

Life insurance riders you add when you buy the policy

How Much Whole Life Insurance Do I Need?

Buying enough whole life insurance coverage is vital, but there are a lot of things to consider when deciding how much is enough. Our life insurance calculator can help simplify that decision.

A general rule of thumb for determining how much life insurance you need is to add up your financial obligations that need to be covered by life insurance (such as a mortgage), and then subtract your assets (such as savings and existing life insurance).

Speaking with a financial advisor is the good way to determine your life insurance needs within the broader picture of your personal finances.

How to Choose the Best Whole Life Insurance Company

Choosing a whole insurance policy may seem like a simple task: You know how much coverage you want and you don’t want to overpay.

But whole life insurance policies are not transparent. When you review policy illustrations, you’ll notice that the insurance company does not disclose any details, such as the cost of insurance (known as mortality cost) or expenses that it takes from your premiums.

Here are some points to consider when looking for the best whole life insurance policy:

The insurer’s dividend history and dividend options are an important component in choosing a whole life insurance policy.

Consider the company’s financial strength. You are purchasing a long-term contract, so you want to choose a company that will be around to pay claims.

Look at multiple life insurance companies. Rates will vary based on age, gender, health history, smoking status and coverage amount (called rate bands). Insurance companies may be competitive in one niche but not in another.

The most important factor in choosing a whole life insurance policy is to “understand that the premium is not the ‘cost’ of a whole life insurance policy,” says Flagg. “The cost is what’s deducted from that premium for ‘cost of insurance’ charges and policy expenses.”Here’s how the basic money flow works on an existing permanent life insurance policy such as whole life insurance:

Starting cash value

Add:

premium

Subtract:

cost of insurance

Subtract: expense chargesAdd:

Dividends (or other earnings)Ending cash value

Keep in mind that this will vary by policy. Costs are usually deducted each month, while dividends and earnings are typically credited on the policy anniversary.

If the policy’s internal costs are higher, your premiums will be higher and/or your cash value will be lower.To determine the costs on a whole life insurance policy, request that the company or life insurance agent provide a calculation of internal policy costs.

For example, our data provider, Veralytic, can provide a report on your policy.

Potential Downsides of Whole Life Insurance

While whole life insurance may seem straightforward, there are things to know:

Dividends are not guaranteed. Sales illustrations include two basic scenarios. There is a projection of the cash value and death benefit based on current dividends, cost of insurance and expense charges. There is also a projection of cash value based on guaranteed values. Typically, whole life insurance is bought and sold based on the projections using current assumptions. Those projections might not pan out.

You might end up paying premiums longer than you expected. “While the maximum annual premium amount can be guaranteed, the maximum number of years that premiums can be required is generally not guaranteed,” notes Flagg of Veralytic.

Changes in dividends are not disclosed. The insurance company will disclose the amount of its annual dividend and possibly the interest rate component of the dividend. However, the company won’t announce whether the dividend is different from the projected dividends in policy illustrations. Dividends are at the discretion of the insurance company and they don’t disclose the methodology used in declaring dividends.

Premiums may become unaffordable. Whole life insurance premiums are significantly higher than term life insurance. People often find that they’re not able to pay the high premiums after a couple of years. The high premiums can also cause people to buy less coverage than they really need.

Surrender charges. What if you decide in the future that you no longer want the policy? If you bought it fairly recently, don’t expect to get any money back. Surrender charges on whole life insurance will be close to 100% for the first two to three years of the policy. The surrender charge decreases each year but will typically last 10 to 16 years.

High lapse rates. The lapse rate is the percentage of policies that are terminated in a year. Whole life insurance has a relatively high lapse rate: Almost 14% of whole life policies lapse in the first year, an additional 9.5% lapse in the second year and 6% in the third year, according to the 2019 Society of Actuaries U.S. Individual Life Insurance Persistency Report. By comparison, about 8% of term life policies and slightly under 7% of universal life insurance policies lapse in the first year.

Be sure that whole life insurance is the right fit for your financial plan and that you will be able to afford the premiums in the future.

Before terminating a whole life insurance policy because you can’t afford it, consider changing your dividend options. For example, you can change the dividend option to reduce/pay premiums rather than purchasing paid-up additions. This will lower your net outlay, although your cash value and death benefit will increase at a reduced rate. Another option is that seniors may also be able to sell the policy for more cash on the life settlement market.

Alternatives to Whole Life Insurance

Whole life insurance isn’t the right life insurance for every situation. In some cases, other types of life insurance might be a better choice.

Universal life insurance

If you want lifetime coverage but also flexibility with premiums and the death benefit amount, and the ability to accumulate cash value, universal life insurance may be a good option.

Indexed universal life insurance

connects a policy’s cash value to an index like the S&P 500. The index’s ups and downs influence the policy’s cash value amount. In that way, a policyholder’s investment choice directly affects an indexed universal life insurance policy’s value, which is unlike whole life.Being a type of universal life policy, policyholders with an indexed universal policy can often change death benefits and premium payments, too.

Variable life and variable universal insuranceVariable life insurance and variable universal life are forms of permanent life insurance. They require you to take an active role choosing investment options for your cash value and monitor performance. With whole life insurance, you don’t choose investments.

Term life insurance

Term life insurance is often the cheapest of life insurance, but it won’t guarantee coverage for the rest of your life like whole insurance can. It offers level premiums during a specific period of time, such as 5, 10, 15, 20 or 30 years. After the level term period, rates go up substantially every year if you renew. With whole life insurance, your premiums stay the same each year for the duration.

Term life insurance can be optimal if you need coverage until large debts, like a mortgage, are paid off or until your children are through college. Term life insurance does not include a cash value component.

Is Whole Life Insurance Worth It?

Whole life insurance can be a great option for people seeking fixed premiums with the low-risk benefit of guaranteed cash value accumulation and a guaranteed death benefit. Since it is a type of permanent life insurance and offers lifetime coverage, you only have to purchase it once. Premiums for whole life insurance are often high, so be sure to consider affordability before buying a policy.