The 6 Most Affordable Life Insurance of 2021

Protect your family with an affordable policy

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Life insurance is an agreement between you and an insurance company. In exchange for premium payments, the provider pays a death benefit to whomever you choose. Life insurance may offer your loved ones financial support if you were no longer around. 

While some policies can be expensive, it's possible to find affordable life insurance. The cheapest policies, which may cost less than $15 per month for young, healthy applicants, are term life insurance policies without any riders for added benefits. While term life insurance offers protection for a specific number of years, it doesn't have a cash value, and you won't have coverage once the term ends.  

You will have many options when looking for affordable life insurance, so it's critical to shop around. To create our list, we researched and analyzed 15 of the most affordable life insurance companies. These are the best options for an array of customers.

The 6 Most Affordable Life Insurance of 2021

Best Overall: Principal

Principal

 Principal

Principal earned our top spot for several reasons. In addition to being one of the most affordable and convenient options, the company’s history, reputation, and financial strength make it a solid choice. Principal also shines with customer service and has fewer complaints than the industry average. The company ranked high for customer satisfaction in J.D. Power’s 2020 U.S. Life Insurance Study.

Pros
  • Online quotes for term life insurance

  • High levels of customer satisfaction

  • Survivorship universal life available

Cons
  • No whole life insurance

  • No option for 40-year term

  • Limited customer service hours

Principal earned our top ranking because of its affordable premiums, company reputation, customer service, and overall satisfaction. Founded in 1979, the Des Moines, Iowa-based company offers insurance and retirement products for individuals and companies. Principal has an A+ rating from AM Best and scored 0.17 on the National Association of Insurance Commissioners (NAIC) 2019 complaint index, well below the industry average of 1.0.

Principal sells life insurance policies including term, universal, and survivorship, but doesn't currently offer a whole life policy. You may convert your term life insurance to a permanent policy without proof of insurability. The company also allows you to tailor your policy with several rider options. If you need other financial products, like a Roth IRA or annuity, Principal has those, as well.  

You can get a quick online quote for term life insurance, but you will have to speak with an agent by phone or in person to apply. Once you have insurance, you can manage your policy online or contact Principal’s support team by phone or email. 

A healthy 35-year-old woman may spend around $13 per month for a 20-year, $250,000 term life insurance policy. For a 50-year-old woman, the price for the same term and death benefits may be approximately $34 per month. 

Read the full review: Principal Life Insurance

Best Term Policies: Legal & General America

Legal & General

 Legal & General

Legal & General America made the cut with its affordable term life insurance because it offers 10- to 40-year term policies with built-in accelerated death benefits and the option to convert to permanent insurance up to age 70. Applicants up to 75 years old may apply for 10- and 15-year term policies, and a family history of cancer won't impact eligibility.

Pros
  • Online quotes for term life insurance

  • Convert term to permanent insurance up to age 70

  • Family history of cancer may not impact eligibility

Cons
  • Must speak with an agent to apply

  • Fewer options to customize a policy

  • Customer service complaints on Trustpilot

Legal & General America scored high with competitive pricing for term life insurance and plenty of ways to customize your policy. Headquartered in London, Legal & General America has been in business since 1836 and includes Banner Life and William Penn. Legal & General America has earned an A+ rating from AM Best. Banner Life and William Penn both scored well, with a 0.07 and 0.00 respectively in the National Association of Insurance Commissioners 2019 Complaint Index. 

Legal & General America offers term life, universal life, and final expense insurance. The company offers 10- to 40-year term life insurance policies with accelerated death benefits included. You may apply for a 10- or 15-year term policy up to age 75 and you may convert a term policy to permanent insurance up to age 70. Another perk: your family's cancer history may not disqualify you from a policy.

You can get a quote for a term life insurance policy online, but you will have to speak with an agent to apply. You may contact Legal & General America’s support team by phone or email. 

A healthy 35-year-old woman may pay a little less than $13 per month for a 20-year, $250,000 term life insurance policy. But a 50-year-old woman may spend about $35 per month for similar coverage.

Best for Young Adults: Protective

Protective

 Protective

Protective edged out the competition with affordable premiums for younger, healthier applicants. The company offers inexpensive term life insurance policies, and you can get a quick quote and apply online for term insurance with up to a 40-year term. Protective also offers a 24/7 virtual assistant via chat for basic questions.

Pros
  • Low premiums for young adults

  • 40-year term policies available

  • Online quote and application for term policies

Cons
  • More costly for smokers or applicants with poor health

  • No online quotes for whole or universal life

  • Below average on J.D. Power 2020 Life Insurance Study

Protective snagged a place on our list because it offers some of the lowest premiums for young, healthy applicants, with online quotes and the ability to apply online. Founded in 1907, the Birmingham, Alabama-based company offers various financial products and has an A+ rating with AM Best. Protective scored better than the industry average for the NAIC 2019 Complaint Index, with a 0.17 score. 

Protective sells term, whole life, and universal life insurance. The company offers up to 40-year term coverage for some applicants and touts an impressive 48% savings for young, healthy policyholders. You may also have the option of converting your term policy to permanent insurance without another medical exam.

While term policies offer an online quote and application, you have to speak with a representative for universal or whole life policies. You can contact Protective's customer service team by phone or chat with the company's virtual assistant 24/7.

A healthy 35-year-old woman may spend around $15 per month for a $250,000, 20-year term policy. The price jumps up to about $39 per month for a 50-year-old woman applying for the same policy. 

Read the full review: Protective Life Insurance

Best for Seniors: Mutual of Omaha

Mutual of Omaha

 Mutual of Omaha

Mutual of Omaha scored high because it offers a variety of policies for senior applicants. The company stands out with whole life and universal coverage up to 85 years of age, and you may renew term life insurance through age 94. The company also has a Mutual Perks program for policyholders, with discounts on eyeglasses and hearing aids.

Pros
  • Solid policy options for seniors

  • Mutual Perks program

  • Ability to meet in person or by phone

Cons
  • Less convenient application process

  • No online quotes or application for some policies

  • Limited details on website

Mutual of Omaha shines because of the company's life insurance for seniors, including universal policies up to age 85 and the ability to renew term policies up to 94. The company has been around since 1909 and has a variety of insurance products. Mutual of Omaha has an A+ rating with AM Best and scored 0.59 on the 2019 Complaint Index from the National Association of Insurance Commissioners, which is better than average.

Mutual of Omaha offers whole life, term, universal, children's whole life, and accidental death insurance. The company also provides an impressive lineup of riders to customize your coverage, like living benefits, allowing you to access some of your policy’s cash value to pay for chronic or terminal illness. In 2020, the company launched its Mutual Perks program, with discounts on eyeglasses, hearing aids, home mortgages, massage, low-cost gym memberships, and more.

Some policies allow you to get a quote and apply online, but others require speaking with an agent. Mutual of Omaha offers support to policyholders by phone or email. Depending on where you live, you may also have the opportunity to meet with an agent in person.    

A healthy 35-year-old woman may spend around $15 per month for a 20-year term life insurance policy valued at $250,000, and a 50-year-old woman may have a monthly bill of around $40 per month for the same policy. 

Read the full review: Mutual of Omaha Life Insurance

Best for Customer Service: State Farm

State Farm

 State Farm

State Farm secured a place on our list because of the company's excellent customer service. The company earned the top ranking for customer satisfaction in J.D. Power's 2020 U.S. Life Insurance Study and scored well on the National Association of Insurance Commissioners 2019 Complaint Index.

Pros
  • Bundled insurance discounts

  • Meet with insurance agent in person, by phone, or via chat

  • Some policies offer online quotes

Cons
  • Not available in all states

  • No online quotes for some policies

  • Limited final expense policies and no medical exam policies

State Farm earned high marks with its commitment to customer service and satisfaction. The company has been in the insurance business since 1922, offering auto, health, home, renters, and life insurance. State Farm has an A++ credit ranking from AM Best and scored 0.24, better than the national average on the NAIC 2019 Complaint Index. 

State Farm offers term, whole life, and universal coverage, and you may save money by bundling your policy with other insurance. The return of premium term life policy stands out, with the ability to get your premiums back after the 20- or 30-year term ends. You may also have the option to convert your term policy to permanent coverage before age 75, regardless of your health status. Depending on where you live, you may buy life insurance in person or by phone, and some policies offer online quotes. You can speak with State Farm's team by phone or through the company's mobile app.

A healthy 35-year-old woman may spend around $19 per month for a 20-year term life insurance policy valued at $250,000, with additional fees for add-on riders. The same life insurance policy may cost a 50-year-old woman about $44 per month.   

Read the full review: State Farm Life Insurance

Best for No Medical Exam: Bestow

Bestow

 Bestow

Bestow made our list because it's one of the few companies offering no medical exam life insurance for all applicants. The company uses accelerated underwriting to give you an instant decision for term life insurance within 10 minutes. If you’re looking for convenience, Bestow’s affordable premiums and 100% online application are worth considering.

Pros
  • No medical exams for all applicants

  • Online quotes

  • Online application with instant decision

Cons
  • 10- and 20-year term life insurance only

  • Only available for ages 21 to 55

  • No available riders

Bestow earned high marks because the company doesn't require medical exams. Founded in 2016, the Dallas, Texas-based company offers one type of policy, term life insurance with no medical exams. North American Company for Life and Health Insurance® issues Bestow's life insurance policies and has an A+ rating from AM Best. The company also scored favorably with no complaints on the National Association of Insurance Commissioners 2019 Complaint Index.

Bestow offers 10- and 20-year term life insurance policies only. You may apply between the ages of 21 and 55, and the company uses an algorithm to determine your eligibility. One restriction to know about: you won’t qualify for the 20-year term policy if you are 45 years old or older. Also, Bestow doesn’t currently offer the opportunity to customize its term life insurance policies with riders.

Bestow offers a fast online quote, and you may apply for a life insurance policy in minutes. The company offers policies in most states, and you may speak to a representative by phone or via live chat. 

A healthy 27-year-old female nonsmoker can get a 20-year term for $34 per month, while a healthy 35-year-old man who doesn’t smoke can get covered for a decade for just $26 per month. (This information is accurate as of 11/6/2019).

Bottom Line

It's easy to get overwhelmed by the cost of life insurance, especially if you are older or have health issues. But fortunately, you may have more options for affordable life insurance than you expect. A cheaper policy may have a smaller death benefit, a shorter term, or fewer riders, so it's essential to review the complete details of your policy before signing up. We find that Principal offers the best overall experience balancing options, service, and pricing. Here's a rundown of each company we reviewed and why they stand out for affordable life insurance. 

 Company  Why We Picked It  Standout Feature
Principal Best Overall Affordable policies with excellent customer service and overall satisfaction
Legal & General America Best Term Policies Term policies up to 40 years with the ability to convert to permanent up to age 70
Protective Best for Young Adults Low premiums for young, healthy applicants
Mutual of Omaha Best for Seniors Permanent coverage for senior applicants up to 85-years-old
State Farm Best for Customer Service Top-ranked customer service
Bestow Best for No Medical Exam No medical exam for all applicants

Frequently Asked Questions (FAQs): Affordable Life Insurance

What Does Affordable Life Insurance Include?

Affordable life insurance is a policy that offers protection at a price that works for your budget. Our roundup features term life insurance because these policies offer the most coverage for the lowest premiums. Typically, the younger and healthier you are, the cheaper your life insurance premiums may be. Depending on the company, you may have access to an array of life insurance policy options. Your life insurance may also have built-in riders to customize your coverage, like a waiver of premium for disability or accelerated death benefits for terminal illnesses. If your policy doesn't automatically include the riders you want, it may be possible to add it for an additional fee. 

What Are the Three Types of Life Insurance?

There are three life insurance types: term life, whole life, and universal life insurance. The simplest type of life insurance, term life insurance, pays a death benefit if you die during the policy term, and the term typically lasts from one to 30 years.

There are also two types of permanent life insurance, whole life and universal life, with cash and investment features. These policies don’t expire after a specific term, and the most significant difference between whole life insurance and universal life insurance are the premiums. While whole life has fixed premiums throughout the policy, universal life may have more flexibility.  

What Is the Cheapest Form of Life Insurance?

Term life insurance is typically the cheapest form of life insurance because it has no cash value and only covers you for a specific number of years. Once a term life insurance policy ends, you will no longer have coverage, and if you pass away after the term ends, your beneficiary won’t receive a payout.

Whole life insurance is the most expensive because it has an investment or savings feature and covers you for life as long as you keep paying the premiums. You may also borrow money from the cash value of your whole life insurance policy. 

What Does Affordable Life Insurance Cost?

Younger, healthier applicants may qualify for the most competitive premiums. Our research shows a healthy, non-smoking, 35-year-old woman could spend less than $13 to almost $25 per month for a 20-year, $250,000 term life insurance policy. A 50-year-old woman may pay anywhere from around $35 to $52 per month for the same term length and death benefit. 

How We Chose the Most Affordable Life Insurance

It’s not easy to find an affordable life insurance policy. Depending on your family's needs, it may be challenging to secure the right amount of coverage with premiums you can afford. To create our list, we researched 15 of the top life insurance companies. We looked at each company's history, reputation, and financial strength. Next, we compared the cost of premiums, coverage, unique features, and customer service. We also considered each company's level of convenience, including whether it's possible to get a quick quote and apply for a policy online. 

Article Sources

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