Best Life Insurance Companies in California

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Contributor, Benzinga
Updated: September 24, 2021

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An accident or injury can happen at any time. Life insurance can help ensure that your family won’t struggle to support themselves if you die or are no longer able to work. But how exactly does life insurance work, and which company should you choose for your policy? We’ll take a look at your life insurance options, as well as some of the best life insurance companies in California. 

What is Life Insurance?

Like most insurance policies, life insurance is a legal agreement between an insurer and a policyholder. Typically, this agreement offers financial protection for a policyholder's beneficiaries. The insurer agrees to pay out what is known as a death benefit if the policyholder passes away while the life insurance policy is active.

The Best Life Insurance in California

  • Bestow Life Insurance
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    Age Requirements
    18-59
    Overall Rating
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    securely through Bestow Life Insurance's website
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    *excludes New York

  • Northwestern Mutual
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    Age Requirements
    18 - 100
    Overall Rating
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  • Transamerica (AEGON)
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    Age Requirements
    18 - 80
    Overall Rating
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  • Ladder Life Insurance
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    Age Requirements
    20 - 60
    Overall Rating
    Read Review
    securely through Ladder Life Insurance's website
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    Ladder Insurance Services, LLC (Cal. license # 0K22568; Ark. license # 3000140372) offers term life insurance policies: (i) in New York, on behalf of Allianz Life Insurance Company of New York, New York, NY (policy form # MN-26); and (ii) in all other states and the District of Columbia on behalf of Allianz Life Insurance Company of North America, Minneapolis, MN (policy form # ICC20P-AZ100 and # P-AZ100). Only Allianz Life Insurance Company of New York is authorized to issue life insurance in the state of New York. Insurance policy prices, coverages, features, terms, benefits, exclusions, limitations and available discounts vary among these insurers and are subject to qualifications. Each insurer is solely responsible for any claims and has financial responsibility for its own products.

Key Points: Life Insurance in California

Before we talk more about policy options, let’s take a look at a few statistics you should know about life insurance in the Golden State.

  • California life expectancy for males: 78.6 years
  • California life expectancy for females: 83.1 years
  • % of adult population with life insurance in 2019: 57%
  • State rank for life expectancy: 2nd

How Does Life Insurance Work?

Life insurance is a type of coverage that offers your beneficiaries a payout if you die while your policy is active. In some circumstances, you may also receive a payout if you’re injured to the point where you can no longer work.

Here’s how it works:

  1. When you sign onto a policy, your insurance company will set a premium that you need to pay every month in exchange for keeping your policy active. You need to pay your premium every single month because even missing 1 can result in your policy being cancelled.
  2. You must also name beneficiaries on your plan when you sign on. Your beneficiaries are the people or entities that receive your insurance payout if you die. Your beneficiaries might be your children, spouse, business partner or even a church or charity.
  3. If you die or become permanently disabled while your policy is active, your beneficiaries receive a payout specified in your policy terms. Your beneficiaries receive the money from your policy as a single lump-sum. For example, if you buy a policy with $250,000 worth of coverage, your beneficiaries will receive that $250,000 after you die so long as you’re up-to-date on your premiums. If you have more than one beneficiary, the money will be split according to the instructions you write into your will or policy term.

There are no limitations on how your beneficiaries can use this money. They can use it to pay for everything from funeral expenses to an outstanding mortgage to general, day-to-day expenses — the sky’s the limit.

Life insurance companies make money by collecting your premium each month and investing the money you pay. They gamble on the chance that you’ll pay all of your premiums on time and not get to use your benefit because you outlive your policy. This is why whole life insurance policies (with guaranteed payouts) are significantly more expensive than term life policies.

How is Your Life Insurance Premium Determined?

The specific price you’ll pay for life insurance each month will vary depending on a number of factors. Let’s take a look at some of the most common factors that influence the cost of life insurance in California.

  • Your age: Older men and women will pay significantly more for life insurance because they’re more likely to die during the term of the policy.
  • Your gender: Women are statistically more likely to live longer. This means that women, on average, pay less for life insurance than men.
  • Your occupation: If you work in a high-risk industry (like logging) you’ll pay much more than if you work in a relatively safe area of employment (like an office).
  • Your hobbies: If you engage in a high-risk hobby (like rock climbing) you can expect to pay more for your insurance coverage.
  • Nicotine use: If you smoke, you’ll pay more for life insurance. If you needed one more reason to quit, this is it.
  • Your medical history: Your life insurance company may require you to take a medical exam or answer questions about your health history before issuing you a policy. 

5 Best Life Insurance Companies in California

Now that you understand how life insurance works, let’s take a look at some of the best life insurance companies in California. 

Fabric Life Insurance
Best For
  • Young families
securely through Fabric Life Insurance's website

1. Best Overall: Fabric

Fabric offers term life insurance, wills and other tools to help you better your family’s financial life. It offers 10-, 15- and 20-year terms and coverage from $100,000 to $5 million, and you can apply for a life insurance policy in just 10 minutes.

To apply for a policy with Fabric, you simply submit your application online or in the Fabric app. Fabric’s licensed team of agents is on hand to answer any questions during the application process. Fabric’s algorithm then processes your information to try to offer you coverage on the spot.

If approved, you can opt to decrease your policy’s term length or coverage amount to fit your needs. Fabric offers highly reviewed online customer service through its app and website, but its policies are not yet available in every state.

2. Best for Overall Term Life Coverage: MassMutual

MassMutual’s cheap life insurance policies are a great choice for anyone looking for term life coverage on a budget. When you sign onto a term life policy from MassMutual, you lock into a monthly premium that doesn’t change for a set number of years — usually between 10 to 20 years.

You can quickly apply for coverage online, and its life insurance needs calculator even helps you estimate the amount of coverage you’ll need to support your family after you pass. You can also save even more by converting your term life policy to a whole life policy after your term ends. This guarantees that your beneficiaries get a payout without requiring you to buy an entirely new policy. 

Bestow Life Insurance
Best For
  • Term life insurance
securely through Bestow Life Insurance's website

3. Best for Simple Coverage: Bestow

If you’re looking for a simple way to get term life insurance, your first stop should be to Bestow Life. Bestow Life boasts that its mission is to make life insurance easier and “more human” for the average buyer — and it offers an incredibly simple signup process.

When you enroll in a policy from Bestow, you won’t need to worry about medical exams or waiting weeks for approval. You can get a policy as short as 10 years or as long as 20 years, and coverage options range from $50,000 to $1 million. Even better, Bestow offers policies from just $8 per month — so its plans can fit into anyone’s budget. 

Mutual of Omaha
Best For
  • Those with Chronic Conditions

4. Best for Coverage Without a Medical Exam: Mutual of Omaha

Most insurance companies require that you receive a comprehensive medical exam before you qualify for a whole life policy. Mutual of Omaha is one of the only whole life insurance providers who offer policies without a medical exam. When you enroll in a whole life policy, you won’t even need to answer any invasive medical questions before you receive approval.

You can apply for a policy online and receive a decision in as little as a few hours. Though Mutual of Omaha only offers limited benefits (their maximum payout is $25,000 for whole life policies) its policies can be more affordable if you’re sick or have a chronic medical condition. It also offers some of the best life insurance for seniors, with policies available up to age 85.  

Allstate
Best For
  • No Recent Claims

5. Best for Bundling: Allstate

No matter where you live, chances are that you have access to some kind of insurance policy from Allstate. Offering everything from auto insurance to homeowner’s insurance and even boat insurance, Allstate is one of the largest insurance providers in the country. It also offers both whole life and term life insurance policies, which you can bundle together with other Allstate policies and save.

Its coverage options are exceptionally affordable — you can find a term life insurance plan for $250,000 for as little as $25 through Allstate. No matter which type of life insurance you need, you can save money by bundling multiple insurance types together through Allstate.  

3 Reasons to Buy Life Insurance

  • Life insurance helps your family cover expenses. When you receive a life insurance policy, you name a set of beneficiaries who will receive your money after you die. If you’re the primary breadwinner in your family, a life insurance policy can help ensure that your family won’t go into debt after you die.
  • Life insurance can help maintain your loved ones’ standard of living. There are no limitations on how your beneficiaries can use the money they receive from your life insurance payout. From paying off a mortgage to ensuring that your child can go to college, a good life insurance plan helps keep your loved ones’ lives on track.
  • Life insurance may accumulate cash you can borrow. If you purchase a term life insurance policy, you may be able to recapture some of the money you spend on premiums with a cash savings account. We’ll discuss the cash value portion of whole life insurance policies in a later section. 

What You Can Expect to Pay

The price you’ll pay for life insurance may vary wildly from what your neighbor or coworker pays. Let’s take a look at what you might expect to pay for coverage.

GenderAgeSmokerCoverage AmountLength of CoverageEstimated Monthly Premium
Female30No$500,00020-year$16.68
Female30Yes$500,00020-year$55.56
Male30No$500,00020-year$19.49
Male30Yes$500,00020-year$68.81
Female45No$750,00030-year$89.06
Male45No$750,00030-year$116.70

Whole Life vs. Term Life

Most life insurance companies offer 2 types of life insurance policies: whole life and term life. Let’s take a look at a few of the differences between them.

Whole Life Insurance

Whole life insurance policies don’t have set terms they’re valid for. When you buy a whole life insurance policy, your beneficiaries are guaranteed a payout so long as you stay up-to-date on your premiums. When you die, your beneficiaries receive the lump-sum payment laid out in your terms, no matter if you die a week from when you got your policy or 50 years in the future. This means that whole life insurance policies are significantly more expensive than term policies.

Whole life insurance policies also include a cash value portion. Each month, your insurance company will set a small percentage of your monthly premium into a savings or investment account. This money accumulates interest and may return dividends. You can access this money by withdrawing it or borrowing against it during your lifetime. One important thing to note — your beneficiaries won’t receive this cash when you die. They’ll only receive your death benefit. Any money you have left in your account will go back to your insurance provider.

Term Life Insurance

Term life insurance policies are much easier to understand. When you take out a term life policy, you choose a set term — typically between 5 and 20 years. During this term, your insurance policy is valid and you pay monthly premiums set by your insurance company.

If you die during your policy’s term, your insurance provider pays out the death benefit to your beneficiaries. If you outlive your policy, your insurance provider closes your policy and keeps the money you paid in premiums. Term life insurance policies have no cash value and are much more affordable when compared to whole life policies.

Protecting Your Family with Life Insurance

Buying a life insurance policy isn’t just about ensuring that your family won’t go into debt after you die. It can also give you the peace of mind that comes along with knowing that your loved ones will be cared for if you pass away without a plan. If you have someone close to you who depends on you for support, it’s a good idea to start considering life insurance policies. 

Frequently Asked Questions

Questions & Answers

Q
How much life insurance do I need?
A

Many in the industry recommend that you carry 8-12 times your annual income in life insurance coverage. A more granular approach can be beneficial, however, and accounting for debt and ongoing financial commitments in more detail when choosing a coverage amount can better provide for your family than an arbitrary multiple of earnings. Get a customized quote for the best policy.

Q
How can I lower my life insurance premiums?
A

Life insurance premiums are based on age, insured amount, and a number of health and behavioral risk factors. Rates have fallen in recent years as longevity has increased and insurers have become better at pricing risk factors. If you have an old policy, it may be possible to replace your coverage for a lower premium with a new policy. If you don’t have coverage yet, don’t wait too long to buy a policy. Rates increase with age. Many insurers also offer a sizeable discount on auto insurance if you have a life insurance policy with the company as well, creating a way to save money on your overall insurance costs. Get the best deals here.

Q
What are the advantages of term life insurance?
A

A term life policy allows you to purchase coverage at a guaranteed premium for a limited amount of time. This structure makes term life an affordable choice to protect your family if you have a financial commitment that won’t last forever, like a mortgage or the cost of raising kids. A 20-year term life insurance policy is the most popular life insurance policy purchased to protect loved ones if the unexpected happens. Get a quote here from top providers.

Explore More: BEST CALIFORNIA MEDICARE PLANS

Methodology

Benzinga crafted a specific methodology to rank life insurance. To see a comprehensive breakdown of our methodology, please visit our Life Insurance Methodology page.