What Is Universal Life Insurance Coverage?

Universal life insurance (UL)is permanent life insurance with flexible premiums and an adjustable death benefit. It also builds cash value, which the policyholder can withdraw while still alive, and comes in several different varieties.

Is Universal Life Insurance the Same as Whole Life Insurance?

Universal life insurance and whole life insurance are similar but not the same. Both policies build cash value and aim to provide lifetime protection, but whole life insurance has fixed premiums and a fixed death benefit. Universal life insurance has flexible premiums, an adjustable death benefit, and a cash value that is sensitive to interest rates.

How Does Universal Life Differ From Term Life Insurance?

Term life insurance offers temporary protection. Term life policies have level premiums and a guaranteed death benefit and do not accumulate cash value. Unlike term life, universal life insurance offers lifetime protection and pays out whenever the policyholder passes away. At first, universal life insurance tends to be more expensive than term life insurance, but term life premiums increase as you get older.

What Are the Expected Costs of Universal Life Insurance?

The cost of universal life insurance is different for everyone, depending on factors such as age and health. The type of policy also dictates how much you’ll pay. Also, don’t overlook the surrender charge, a penalty you’ll pay if you want to cash out of the policy early.

Is Universal Life Insurance Worth It?

If you’re looking for a flexible life insurance policy with lifetime protection or cash value, universal life insurance might be worth it. Many companies allow you to add a no-lapse guarantee rider as you age, guaranteeing that your policy won’t lapse as long as a minimum premium amount is paid. But if you need permanent coverage with an iron-clad guarantee, whole life is likely a better option.

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5 Best Universal Life Insurance Companies of 2024

Northwestern Mutual is our pick for the best

Elizabeth Rivelli

and

Meredith Mangan

Updated September 30, 2023

Reviewed by

Anthony Battle

Fact checked by

Michael Rosenston

If you’re looking for life insurance that can increase in value based on current interest rates, a universal life insurance policy might be a good fit. Universal life (UL) insurance provides lifetime protection and cash value that you can use to adjust your premiums or even eliminate them altogether. To get a universal life insurance quote, you'll need to call an agent directly because quotes aren't generally available online. We've compiled a list of the best universal life insurance companies to help you find the best fit, and we've based our rankings on an analysis of 91 companies that includes data points like maximum coverage amounts and issue ages, and customer service ratings from J.D. Power and from Life Happens and LIMRA.

Best Universal Life Insurance Companies of 2024

Best Overall: Northwestern Mutual
Best Variable Universal Life Insurance: Nationwide
Best Indexed Universal Life Insurance: Mutual of Omaha
Best Reputation: State Farm Life Insurance
Best for No-Medical-Exam: Penn Mutual

Companies reviewed

Features considered

5,005

Data points analyzed

We collected over 5,000 data points from 91 life insurance companies to measure financial stability, customer satisfaction, product and feature variety, and the overall buying experience. We then evaluated each company based on 55 metrics to develop unbiased, comprehensive reviews.

Read our Full Methodology

with our partner Covr Financial from multiple providers before buying.

Best Overall : Northwestern Mutual

AM Best Rating: AM Best is a credit rating agency that assigns insurance companies a letter grade from “A++” to “D.” A company’s grade indicates its ability to pay its claims and honor its financial obligations. A++
Accepts Credit Cards: No

Get A Quote

Why We Chose It

Northwestern Mutual stands out for its superior third-party ratings. It has the highest financial strength ratings from AM Best (A++), Moody's (Aaa), and Fitch (AAA), and was ranked fourth out of 22 companies for overall customer satisfaction by J.D. Power. Northwestern Mutual also has one of the lowest complaint indexes of the 91 companies we reviewed.

Pros & Cons

Pros

Superior financial strength
In business since 1859
Ranked highly for customer satisfaction
Very few complaints

Cons

Limited policy details online
No IUL policies

Overview

Not only is Northwestern Mutual the largest life insurance company with about 9.02% of the total market share, but it’s also one of the oldest insurers, having been founded in 1859.

The company sells traditional UL and variable universal life (VUL) policies. Like most UL policies, its Custom UL policy has a flexible death benefit and adjustable premiums and builds cash value on a tax-deferred basis. The company’s VUL policy is similar but lets you invest the cash value in a wide range of mutual-fund-like subaccounts with features like automatic portfolio rebalancing and automatic dollar-cost averaging. You can choose from 40 different investment funds to build your own portfolio or select pre-packed solutions that adhere to different asset allocation models.

VUL policies are typically more expensive than regular UL policies because of investment fees.

The main drawbacks are that Northwestern provides fewer details on its website compared to most of its competitors, and you’ll need to look elsewhere for indexed universal life (IUL).

Read the Full Northwestern Mutual Life Insurance Review

Best Variable Universal Life Insurance : Nationwide

AM Best Rating: AM Best is a credit rating agency that assigns insurance companies a letter grade from “A++” to “D.” A company’s grade indicates its ability to pay its claims and honor its financial obligations. A+
Accepts Credit Cards: Yes

Get A Quote

Why We Chose It

Nationwide’s VUL products offer many perks. You can invest in a wide range of funds, choose from three indexed interest strategies plus two fixed accounts, take advantage of Nationwide’s premium monitoring tools, and enroll in Nationwide’s VUL rewards program.

Pros & Cons

Pros

No medical exam for some healthy applicants
Few customer complaints
Highly rated for customer satisfaction
Three living benefits included

Cons

No live chat

Overview

The company includes three living benefits—for chronic, critical, and terminal illnesses—at no upfront cost. It also makes a generous long-term care rider available should you want the option of using the death benefit for long-term care needs.

Nationwide offers two variable universal life (VUL) policies—Variable Universal Life Accumulator and Variable Universal Life Protector—plus one designed exclusively for financial advisors. For an extended no-lapse guarantee rider, choose VUL Protector, and add it to your policy. You can get traditional UL and IUL insurance through Nationwide as well.

Applicants who meet certain criteria may be able to purchase it without a medical exam: Accelerated underwriting is available for individuals 18 to 50 applying for $100,000 to $5 million and for individuals 18 to 60 applying for $100,000 to $1 million.

We also like that Nationwide has excellent third-party ratings. The company is ranked sixth out of 22 companies and scored far above average for overall customer satisfaction in J.D. Power’s 2022 U.S. Individual Life Insurance Study. It also has an A+ (Superior) financial strength rating from AM Best.

Read the Full Nationwide Life Insurance Review

Best Indexed Universal Life Insurance : Mutual of Omaha

AM Best Rating: AM Best is a credit rating agency that assigns insurance companies a letter grade from “A++” to “D.” A company’s grade indicates its ability to pay its claims and honor its financial obligations. A+
Accepts Credit Cards: Yes

Get A Quote

Why We Chose It

Both Mutual of Omaha's indexed universal life (IUL) policies are straightforward and relatively easy to understand. Your cash value is tied to the performance of the S&P 500 based on an annual point-to-point crediting method, and each lets you choose between three indexed-interest crediting strategies, including one with no cap.

Pros & Cons

Pros

Many policies include three living benefits
Wide range of optional riders
Excellent financial strength
Quick-issue IUL available
Live chat available

Cons

No VUL policies

Overview

Both of Mutual of Omaha’s IUL policies—Life Protection Advantage and Income Advantage—include living benefits for terminal and chronic illnesses plus a guaranteed refund option rider for eligible applicants. With Income Advantage, your cash value has the greatest potential for growth. Life Protection Advantage provides additional guarantees, such as short-term and long-term no-lapse protection riders. You can also add a long-term care rider plus standard riders for a fee, such as a guaranteed insurability rider, a child term rider, a disability income rider, and an accidental death rider. The riders available will depend on the specific policy and your location. To get an IUL or UL policy from Mutual of Omaha, you must work with an agent to get a quote and apply.

Read the Full Mutual of Omaha Life Insurance Review

Best Reputation : State Farm Life Insurance

AM Best Rating: AM Best is a credit rating agency that assigns insurance companies a letter grade from “A++” to “D.” A company’s grade indicates its ability to pay its claims and honor its financial obligations. A++
Accepts Credit Cards: Yes

Get A Quote

Why We Chose It

In J.D. Power’s 2022 U.S. Individual Life Insurance Study, State Farm was number one out of 22 companies. It also has an A++ (Superior) financial strength rating from AM Best—the highest grade possible—and fewer complaints than expected for its size.

Pros & Cons

Pros

Highly rated for customer satisfaction and financial stability
Few customer complaints
Multiple riders for UL policy customization
Savings for bundling life insurance with auto insurance
Superior financial strength

Cons

No free living benefits riders
No IUL or VUL policies

Overview

State Farm offers traditional UL policies for applicants up to age 85. You can customize your policy with a handful of riders, including a flexible care benefit, level term rider, children’s term rider, waiver of premium rider, and guaranteed insurability rider (these cost extra). Unfortunately, this policy doesn’t include any free living benefit riders, which is uncommon among our other top-rated companies.

Another thing we like about State Farm is its generous policy bundling discounts. You can qualify for savings if you purchase a life insurance and auto insurance policy together. According to State Farm, bundling your policies can save you up to $1,127 on the combined premium.

Read the Full State Farm Life Insurance Review

Best for No-Medical-Exam : Penn Mutual

AM Best Rating: AM Best is a credit rating agency that assigns insurance companies a letter grade from “A++” to “D.” A company’s grade indicates its ability to pay its claims and honor its financial obligations. A+
Accepts Credit Cards: Yes

Get A Quote

Why We Chose It

Penn Mutual leads the pack in terms of how much coverage it’s willing to provide without a medical exam.

Pros & Cons

Pros

No-medical-exam policies available
Very few customer complaints
Living benefits riders included with most policies
UL, IUL, and VUL policies available

Cons

Limited website information

Overview

Via Penn Mutual’s Accelerated Client Experience (ACE) program, healthy applicants between 0 and 65 years old can qualify for up to $7.5 million without taking an exam. Accelerated underwriting is available on a variety of Penn Mutual UL policies, including Guaranteed Protection UL, Protection UL, Accumulation Builder Flex IUL, and Diversified Advantage VUL. Eligible policies include terminal and chronic illness riders included at no upfront cost. Other endorsements are available, including an accidental death benefit rider, additional insured term rider, children’s term rider, and waiver of premium rider, for a fee.

In terms of third-party ratings, Penn Mutual fares well. It has an A+ (Superior) financial strength rating from AM Best and fewer complaints than expected for its size. However, the company doesn’t provide policy specifics on its consumer-facing website. We’d like to see more transparency so you can better compare products before supplying your personal information.

Read the Full Penn Mutual Life Insurance Review 2023

	Best For	AM Best Rating AM Best is a credit rating agency that assigns insurance companies a letter grade from “A++” to “D.” A company’s grade indicates its ability to pay its claims and honor its financial obligations.	Term Life Sample Cost	Policy Types	Accepts Credit Cards		Reset All
Northwestern Mutual	Best Overall	A++	N/A	Term, Universal (UL), Variable Universal (VUL), Whole	No	Get A Quote	Hide, not for me
Nationwide	Best Variable Universal Life Insurance	A+	$26.25/month	Final Expense, Indexed Universal (IUL), Term, Universal (UL), Variable Universal (VUL), Whole	Yes	Get A Quote	Hide, not for me
Mutual of Omaha	Best Indexed Universal Life Insurance	A+	$28.38/month	Final Expense, Indexed Universal (IUL), Term, Universal (UL)	Yes	Get A Quote	Hide, not for me
State Farm Life Insurance	Best Reputation	A++	$35.24/month	Final Expense, Term, Universal (UL), Whole	Yes	Get A Quote	Hide, not for me
Penn Mutual	Best for No-Medical-Exam	A+	$23.92/month	Term, Universal (UL), Variable Universal (VUL), Whole	Yes	Get A Quote	Hide, not for me

Quotes above are examples of what a 40-year-old in excellent health might pay for a 30-year $250,000 policy. Get life insurance quotes from multiple companies to find your best rate.

Final Verdict

All of the above companies are worth investigating if you’re looking for a universal life insurance policy. But the type of policy you want—UL, IUL, or VUL—will partly dictate your options. Nationwide and Penn Mutual offer all three and are excellent places to start. Northwestern Mutual does not offer an IUL policy at this time, but it offers traditional and VUL policies and has the strongest financial position of all companies on this list (and most in the market). Plus, along with Nationwide and State Farm, it was ranked very highly for customer satisfaction by J.D. Power. For IUL, compare Mutual of Omaha’s offerings to those of Nationwide and Penn Mutual.

More Ratings of Top Life Insurance Companies

Frequently Asked Questions

What Is Universal Life Insurance Coverage?

Universal life insurance (UL)is permanent life insurance with flexible premiums and an adjustable death benefit. It also builds cash value, which the policyholder can withdraw while still alive, and comes in several different varieties.
Is Universal Life Insurance the Same as Whole Life Insurance?

Universal life insurance and whole life insurance are similar but not the same. Both policies build cash value and aim to provide lifetime protection, but whole life insurance has fixed premiums and a fixed death benefit. Universal life insurance has flexible premiums, an adjustable death benefit, and a cash value that is sensitive to interest rates.
How Does Universal Life Differ From Term Life Insurance?

Term life insurance offers temporary protection. Term life policies have level premiums and a guaranteed death benefit and do not accumulate cash value.
Unlike term life, universal life insurance offers lifetime protection and pays out whenever the policyholder passes away. At first, universal life insurance tends to be more expensive than term life insurance, but term life premiums increase as you get older.
What Are the Expected Costs of Universal Life Insurance?

The cost of universal life insurance is different for everyone, depending on factors such as age and health. The type of policy also dictates how much you’ll pay. Also, don’t overlook the surrender charge, a penalty you’ll pay if you want to cash out of the policy early.
Is Universal Life Insurance Worth It?

If you’re looking for a flexible life insurance policy with lifetime protection or cash value, universal life insurance might be worth it. Many companies allow you to add a no-lapse guarantee rider as you age, guaranteeing that your policy won’t lapse as long as a minimum premium amount is paid. But if you need permanent coverage with an iron-clad guarantee, whole life is likely a better option.

Methodology

In order to compile our list of the best life insurance companies, we developed a comprehensive life insurance methodology. We started off by researching what consumers want from life insurance companies, and for that, we looked to third-party consumer studies, including J.D. Power’s 2021 U.S. Life Insurance New Business Study and the 2021 Insurance Barometer Study by Life Happens and LIMRA.

With those findings in mind, we gathered more than 50 data points on 91 life insurance companies, including ratings for financial strength, customer satisfaction, and customer complaints, as well as information about years in business, cost, online tools, no-exam options, policy types and features, and available riders. Our review process gave preference to companies with superior financial stability, few customer complaints, and a robust suite of products and resources. We compared individual offerings between companies by delving deeper into product specifics, including maximum coverage amounts, maximum issue ages, included riders, and how the cash value is invested (for permanent products). We used this research to determine the best companies for different products and consumer groups, including term life insurance and the best universal life insurance companies.

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