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Whole life insurance is a type of permanent life insurance that provides coverage for your entire life and has a cash value that earns interest. It's generally best for high earners and people with long-term financial obligations.

Katherine Murbach Policygenius

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Katherine Murbach

Katherine Murbach

Associate Editor & Licensed Life Insurance Expert

Katherine Murbach is an associate editor and a licensed life insurance expert at Policygenius. Previously, she wrote about life and disability insurance for 1752 Financial, and advised over 1,500 clients on their life insurance policies as a sales associate.

Edited byLogan Sachon

Logan Sachon

Senior Managing Editor, Life Insurance & Research

Logan Sachon is the senior managing editor of life insurance and research at Policygenius, where she edits life insurance content and leads life insurance surveys and data studies. As a journalist, her work has appeared in The Guardian, Business Insider, CNN Money, BuzzFeed, Money Under 30, VICE, New York Magazine, and elsewhere.

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Expert reviewed

This article has been reviewed by a licensed Policygenius expert to ensure that sources, statistics, and claims meet our standard for accurate and unbiased advice.

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By

Patrick Hanzel, CFP®

Patrick Hanzel, CFP®

Certified Financial Planner™ & Advanced Planning Team Lead

Patrick Hanzel, CFP®, is a Certified Financial Planner™ and Advanced Planning Team Lead at Policygenius. His expertise has been featured at Lifehacker, Consumer Affairs, Authority Magazine, Thrive Global, and Fatherly.

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Why shop with us for whole life insurance

We do more than just sell insurance. Whether you're just getting started shopping or are ready to buy, our licensed experts are here at every step to answer your questions, handle paperwork, and help you secure the whole life policy that's right for your family.

Life

What is whole life insurance? 

Whole life insurance is a type of permanent life insurance that lasts your entire life and includes a cash value component that you can access while you’re alive. There are many types of whole life insurance, but traditional whole life is the most common.

How does whole life insurance work? 

Like all life insurance products, whole life insurance pays a tax-free death benefit to your beneficiaries upon your death. Three other features of a whole life insurance policy include:

  • It doesn’t expire: Because it’s a type of permanent life insurance, whole life insurance lasts your entire life.

  • It builds long-term cash value: Whole life also has a cash value component that accumulates value over time based on a guaranteed minimum interest rate set by your insurance company. The cash value can be accessed while you’re still alive. 

  • It may pay dividends: Some traditional whole life policies are dividend-paying, meaning they pay an annual bonus to policyholders if the insurance company over-performs financially. 

Who is a whole life insurance policy best for? 

A traditional whole life policy is best for people who have long-term financial obligations or high-net-worth individuals.

People with long-term financial obligations

If you have financial obligations that will last longer than 20 to 30 years — for example, lifelong dependent children or if you expect to care for aging parents — having a permanent death benefit can ensure they'll be cared for whether you're living or not.

High-net-worth individuals

High earners or people with large estates can benefit from whole life insurance. If you’re already maxing out traditional investment accounts like a 401(k) or IRA, whole life insurance can offer an additional investment vehicle. Whole life insurance can also be used as a buffer against estate tax, if your estate falls in the qualifying bracket.

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How much does whole life insurance cost?

Rates for a whole life policy with a $500,000 coverage amount could range from $350 to $1,500 per month or more based on your age, gender, health, and policy choices. A Policygenius agent can help you tailor a whole life policy to your budget.

Average monthly whole life insurance rates by age and gender

Age

Sex

$250,000 coverage amount

$500,000 coverage amount

$1 million coverage amount

25

Female

$180

$356

$697

Male

$209

$413

$810

35

Female

$251

$498

$981

Male

$309

$612

$1,210

45

Female

$389

$773

$1,532

Male

$478

$952

$1,858

55

Female

$635

$1,266

$2,517

Male

$775

$1,545

$3,038

Methodology: Rates are calculated for male and female non-smokers in a Standard health classification, obtaining a $250,000, $500,000, and $1,000,000 whole life insurance policy fully paid up at age 100 from MassMutual. Individual rates will vary as specific circumstances will affect each customer's rate. Rate illustration valid as of 12/01/2022.

How to buy whole life insurance with Policygenius 

An insurance expert from Policygenius can help you choose the best whole life insurance policy for your needs and budget. We offer multiple whole life policies from top insurers including MassMutual, Prudential, Mutual of Omaha, and AIG:

  1. Get quotes. Enter a few details about your background and get an estimated quote range for whole life insurance. You can get started here

  2. Talk to a licensed Policygenius expert. Next, we’ll set up a brief phone call with one of our licensed agents to talk through your needs and find the best policy for you. Once you pick a policy, we’ll help you fill out the application, which you’ll sign online.

  3. Complete the application process. In most cases, you’ll need to schedule a medical exam.

  4. Wait for your offer. The typical underwriting time takes five to six weeks. When you apply through Policygenius, we'll coordinate with the insurance company and keep you updated every step of the way.

  5. Accept your coverage and enjoy peace of mind. Once you accept your offer, sign the policy paperwork and pay your first premium on your whole life policy, you’re covered for life. Need to make changes? Policygenius can help with that, too.

Best whole life insurance companies of November 2022

The top whole life insurance companies for you will be the ones that offer the coverage and policy features you need and premium prices you can afford. While a Policygenius agent can help you choose the best whole life policy for your needs, this is the best traditional whole life policy in our marketplace for most people:

Best whole life insurance for most people

MassMutual

Policygenius rating 

Our proprietary rating methodology takes multiple factors into account, including customer satisfaction, cost, financial strength, and policy offerings. See the "methodology" section for more details.

Full orange starFull orange starFull orange starHalf orange starEmpty gray star

3.8

AM Best rating 

A.M. Best is a global credit rating agency that scores the financial strength of insurance companies on a scale from A++ (Superior) to D (Poor).

A++

Cost 

Using a mix of internal and external rate data, we grade the cost of each insurance company's premiums on a scale from least expensive ($) to most expensive ($$$$$).

NR

All 50 states

Why we chose it

MassMutual’s whole life insurance plan provides a lifetime coverage option that builds cash value with the potential to earn dividends.

Read our full MassMutual review
Pros and cons

Pros

  • Strong financial stability ratings

  • Potential for dividends

  • Offers a variety of permanent life insurance products

Cons

  • No option to skip the medical exam

  • High premiums

Why we picked it

This A++ rated mutual life insurance company pays higher dividends to its cash value policyholders than some of its competitors. The company has high customer experience ratings compared to other insurers on the Policygenius marketplace and consistently receives high third-party financial stability ratings, which is especially important when purchasing a permanent policy.

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Alternatives to whole life insurance 

The three most common alternatives to traditional whole life insurance are term life insurance, guaranteed universal life insurance, and guaranteed issue whole life insurance.

Term life insurance

If you don’t need life-long coverage, term life insurance is likely the best life insurance product for you, especially because it’s affordable: whole life costs five to 15 times more than term life insurance. You purchase a policy for a set term — usually 10 to 40 years — and pay premiums during that term.

Once the term expires, so does your coverage (though there is often a possibility to convert a term policy to a permanent policy if you still need protection). Policygenius offers term life coverage from top insurers including AIG, Banner Life, William Penn, Brighthouse Financial, Foresters Financial, Lincoln Financial, Pacific Life, Protective Life, Prudential, Symetra, and Transamerica.

Guaranteed universal life insurance

If you need life-long insurance coverage but don’t anticipate needing the cash value component, guaranteed universal life insurance may be a good option. It has fixed premiums, a small cash value component, and is often the most cost-effective permanent life insurance policy available to most people.

Policygenius offers guaranteed universal policies from top insurers including AIG, Pacific Life, Protective Life, and Prudential. 

Guaranteed issue whole life insurance

Guaranteed issue whole life is a type of final expense insurance, also known as burial insurance, that is meant to cover the costs of a funeral and other final expenses. It offers near-certain approval, doesn’t require a medical exam, and coverage limits generally max out at $25,000.

Coverage is expensive — a $25,000 coverage amount could cost $150 to $500 or more a month — but is often available to people who don’t qualify for traditional policies. Policygenius offers final expense whole life policies from Mutual of Omaha and AIG.

Policy type

Coverage length  

Available coverage amount 

Cash value 

Medical exam required

Whole life

Permanent 

$100,000 to $10 million+

Yes

Yes

Term life 

10 to 40 years 

$100,000 to $10 million+

No

Not always 

Guaranteed universal life 

Permanent 

$100,000 to $10 million+

Yes, but minimal

Yes 

Guaranteed issue whole life 

Permanent 

$5,000 to $25,000

Some policies

No 

A Policygenius agent can help you choose which life insurance type is best for you — and help you apply for and buy coverage through the Policygenius insurance marketplace.

Frequently asked questions

What does whole life insurance mean?

Whole life insurance means a permanent life insurance policy that has a death benefit and cash value component.

Is whole life insurance a good policy?

Whole insurance is generally a good policy fit for high-net-worth individuals or people with long-term financial obligations. For most people, however, term life insurance offers a more convenient and affordable coverage option. Speaking with a licensed agent or financial planner can help determine which type of life insurance is best for you.

Does whole life insurance build cash value?

Yes, whole life insurance policies build cash value, usually at a set rate by your insurer.

Can you cash out a whole life insurance policy?

You can surrender a whole life policy in exchange for the cash value minus the surrender fee. Since the cash value can take years to build, surrendering a whole life policy too early may lead to extra fees.

What is the minimum amount of whole life insurance I should buy?

The minimum amount of life insurance coverage you should buy will depend on your financial protection needs. Typically, $50,000 is the minimum available for traditional whole life policies, while other types of whole life, like guaranteed issue, can provide as little as $2,000 in coverage.

Author

Associate Editor & Licensed Life Insurance Expert

Katherine Murbach

Associate Editor & Licensed Life Insurance Expert

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Katherine Murbach is an associate editor and a licensed life insurance expert at Policygenius. Previously, she wrote about life and disability insurance for 1752 Financial, and advised over 1,500 clients on their life insurance policies as a sales associate.

Editor

Senior Managing Editor, Life Insurance & Research

Logan Sachon

Senior Managing Editor, Life Insurance & Research

gray twitter icon linkgray linkedin icon link

Logan Sachon is the senior managing editor of life insurance and research at Policygenius, where she edits life insurance content and leads life insurance surveys and data studies. As a journalist, her work has appeared in The Guardian, Business Insider, CNN Money, BuzzFeed, Money Under 30, VICE, New York Magazine, and elsewhere.

Expert reviewer

Certified Financial Planner™ & Advanced Planning Team Lead

Patrick Hanzel, CFP®

Certified Financial Planner™ & Advanced Planning Team Lead

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Patrick Hanzel, CFP®, is a Certified Financial Planner™ and Advanced Planning Team Lead at Policygenius. His expertise has been featured at Lifehacker, Consumer Affairs, Authority Magazine, Thrive Global, and Fatherly.

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