How To Get Life Insurance (2024)

There are many options to choose from when buying life insurance. But sometimes, the more options there are, the more challenging it is to make a choice.

Understanding the steps involved in getting life insurance will help simplify the process and make it easier to get the coverage that suits you best.

To determine if you need life insurance, consider the financial impact your death would have on your dependents. What would life look like for them without your income? Will they have the financial resources to cover your end-of-life expenses? Will they have a mountain of debt to pay off?

Next, assess what resources you have in place to support your dependents. This would include an emergency fund, retirement savings and any life insurance coverage you currently have. If there are gaps between what you have and what your loved ones would need to maintain their standard of living, you need life insurance.

Consider working with a financial planner to discuss what needs you should cover with life insurance—whether it’s a mortgage that will need to be paid, children who will need to be supported, a small business to maintain or a legacy you want to leave.

People often underestimate how much life insurance they need, says Adam Winslow, CEO of Direct Line Group. They tend to think only about how much would be required to pay off their major debt, such as a mortgage. However, they should consider how much more would be needed to help a spouse or partner pay bills, support children, pay for college tuition or cover any other long-term needs, he says.

Here is a list of costs to consider when you’re deciding how much life insurance you need.

• Bill payments.
• College tuition costs.
• Costs of raising children.
• Debt payoff balances.
• End-of-life costs.
• Living expenses for dependents.

One rule of thumb is to have a policy with a death benefit equal to 10 times your annual salary. But your own situation and financial goals might require that you have more—or less—than that amount. A life insurance calculator is a good starting point for an estimate, and then a financial planner can help you develop a more precise figure.

There are two main types of life insurance: term life insurance and permanent life insurance. And there are several subtypes of permanent life insurance to consider.

Term Life Insurance

Term life insurance has a level term period when rates stay the same. After this period, you can renew the policy, but at much higher rates each year. Choices of coverage lengths are generally 5, 10, 15, 25 or 30 years. Term life is usually the cheapest way to buy life insurance and is ideal if you need coverage for a specific timeframe or debt.

Permanent Life Insurance

If you’re interested in lifelong coverage and the opportunity to build cash value—which accumulates on a tax-deferred basis—consider permanent life insurance. It’s more expensive than term life because of the coverage length, cash value and policy charges, but you can tap into the policy’s cash value while you’re alive.

Whole Life Insurance

Whole life insurance can provide coverage for the duration of your life, usually up to 95 to 120 years of age. An account within the policy builds cash value over time by using part of your premium payment and adding interest or investment gains, depending on the policy type.

Whole life insurance is one of the most expensive ways to buy life insurance. However, it has built-in guarantees that the premium will remain fixed, the death benefit will remain the same and the cash value will earn a fixed rate of return. Whole life is good for people who want permanent coverage with guarantees and have a large budget for life insurance.

Universal Life Insurance

Universal life insurance (UL) can seem complex because it has some subtypes, such as variable universal and indexed universal life insurance, with different features. With universal life you can typically vary premium payments and adjust the death benefit amount within certain limits. UL policies have a cash value component.

Universal life insurance is generally cheaper than whole life insurance.

No-Exam Life Insurance

No-exam life insurance is any type of life insurance that does not require a medical exam. There are no-exam options for term, whole and universal life policies. Depending on the type of underwriting, no-exam options may or may not be low-cost. The best no-exam life insurance rates are offered to younger buyers (below 50) in good health.

Life insurance riders are add-ons to a life insurance policy providing extra coverage or benefits. Some policies include specific life insurance riders, and others must be added at an additional cost. Since riders are likely to increase your costs, carefully consider if customizing your policy with riders will be worth it.

Here are some common riders:

• Accelerated death benefit rider.
• Child life insurance rider.
• Disability rider.
• Early-enhanced cash value rider.
• Estate protection rider.
• Guaranteed insurability rider.
• Lapse protection rider.
• Long-term care insurance rider.
• Overloan protection rider.
• Return of premium rider.
• Spouse life insurance rider.
• Term life insurance conversion rider.
• Waiver of premium rider.

The two key factors life insurance companies consider when determining the rate you pay for coverage are health and age. The younger you are when you buy life insurance, the cheaper it will be because you have a longer life expectancy. But there are various other factors insurers consider, too.

Here are the main factors that affect the cost of life insurance.

• Age and gender
• Smoking/nicotine use
• Coverage length and amount
• Health and family medical history
• Drug and alcohol use
• Occupation and any high-risk hobbies

Many insurers offer free quotes online, especially for term life insurance, which makes it easy to compare life insurance quotes. Because rates will vary, you should get quotes from several companies. You also could use an independent insurance agent who works with several insurance companies and can help you find the best coverage at the best price.

Best Life Insurance Companies

To help simplify your search for the best insurance company, we analyzed life insurance policies using a database of more than 9,000 policies and scored key metrics, including cost, historical performance, financial strength and cash value.

Here’s a look at the companies that earned a place on our list of the best life insurance companies.

Our expert take	Company	Company - Logo	Forbes Advisor Rating	Forbes Advisor Ratings	AM Best Financial Strength rating	Learn More CTA text	Learn more CTA below text	LEARN MORE
Best for variable universal life insurance	Pacific Life		5.0		A+ (Superior)	Compare Quotes	Compare quotes from participating carriers via Policygenius.com
Best for indexed universal life insurance	Protective		5.0		A+ (Superior)	Compare Quotes	Compare quotes from participating carriers via Policygenius.com
Best for recreational marijuana users	Corebridge Financial		4.8		A (Excellent)	Compare Quotes	Compare quotes from participating carriers via Policygenius.com
Best for universal life insurance	Penn Mutual		4.7		A+ (Superior)	Compare Quotes	Compare quotes from participating carriers via Policygenius.com
Great for reliable policy illustrations	Transamerica		4.7		A (Excellent)	Compare Quotes	Compare quotes from participating carriers via Policygenius.com
Best for term life insurance	Symetra		4.5		A (Excellent)	Compare Quotes	Compare quotes from participating carriers via Policygenius.com
Great for estate planning	Lincoln Financial		4.3		A+ (Superior)	Compare Quotes	Compare quotes from participating carriers via Policygenius.com
Great for seniors	Midland National		4.1		A+ (Superior)	Compare Quotes	Compare quotes from participating carriers via Policygenius.com
Great for financial strength	MassMutual		4.0		A++ (Superior)	Compare Quotes	Compare quotes from participating carriers via Policygenius.com
Great for young adults	Nationwide		4.0		A+ (Superior)	Compare Quotes	Compare quotes from participating carriers via Policygenius.com

Fill Out the Life Insurance Application

The quote you get from an insurer is an initial estimate of what your premium will be. To get a policy, you’ll usually have to fill out a lengthy application. You’ll be asked questions about your age, weight, personal medical history and mental health, family medical history and nicotine use.

The insurer will also ask questions about your driving record and whether you have a dangerous job or hobbies that make you more of a risk to insure. All of this information is used to determine what your actual life insurance premium will be.

If you lie on a life insurance application and the insurer discovers the lie right away, your application could be denied. Denials can affect future applications. Insurance companies use third-party sources to validate the information you provide. For example, an insurance company can get information about you by accessing your medical records, prescription drug history, motor vehicle report and public records. You also might be required to take a life insurance medical exam, which includes blood and urine tests.

If the insurer discovers a lie on an application later on, it could deny the death benefit payout to your beneficiaries.

It’s very important to be truthful on the life insurance application so that your policy can’t be voided later on.

Choose a Life Insurance Beneficiary

During the application process you’ll be asked to designate a life insurance beneficiary. A life insurance beneficiary is the person, persons or entity you choose to receive the policy death benefit when you pass away.

There are two types of beneficiaries, primary and contingent. A primary beneficiary will receive the death benefit if you die. A contingent beneficiary is a back up beneficiary who will only receive the death benefit if the primary beneficiary has passed away.

If you list more than one beneficiary as primary or contingent, you’ll also need to determine how the death benefit will be split. For example, you may want the death benefit to be split evenly among your children.

Undergoing a Life Insurance Medical Exam

A life insurance medical exam helps the insurer determine your life expectancy. The exam process usually takes a short time (15 to 45 minutes, and what it includes can depend on your age and the amount of life insurance you’re applying for.

A medical exam may include:

• Going over your application answers again.
• Blood pressure.
• Electrocardiogram (EKG).
• Height and weight.
• Blood sample.
• Urine sample.

Temporary Life Insurance Coverage

If the underwriting process will take a few weeks or more, you can usually lock in temporary life insurance coverage by attaching a check with your first premium payment to your application. This gives you coverage and peace of mind while you wait for the application to be processed. Ask your life insurance agent about this option.

The insurance company will send you a policy offer once all underwriting is complete. The final step in buying life insurance is reviewing the policy, signing it and paying your first premium.

Depending on your insurance company, this may be done online electronically, or you may need to mail the documents. Be sure to keep a copy somewhere safe that is known by your beneficiaries.