If you are shopping for life insurance quotes, there are a number of life insurance companies that rate nearly as highly as the top choices (Mass Mutual and Northwestern Mutual insurance companies) and are worth considering if they offer you a better premium. All earn good grades -- just a notch or so below the very best life insurance companies -- from agencies that rate financial strength and good ratings from consumers and/or organizations like the Better Business Bureau.
For example, American Family Life Insurance Co., American Fidelity Assurance Co., Auto-Owners Life Insurance Co. and Country Life Insurance Co. all make Weiss Ratings' list of the financially strongest life insurance companies (the strictest ratings agency, according to ConsumerReports.org), and the Better Business Bureau gives them all an A+ for trustworthiness. Customer complaints are low, too: Policy for policy, all four of these life insurance companies had fewer complaints upheld against them by state insurance regulators in 2009 than the national median for insurance companies.
Columbus Life Insurance Co., John Hancock Life Insurance, State Farm Life Insurance Co. and Western & Southern Life Insurance make A.M. Best's list of long-time stalwarts. John Hancock and Western & Southern have held an "A" or better financial strength rating at A.M. Best for 75 years, and Columbus and State Farm have held that rating for 50 years (all hold the highest rating of A++). All but State Farm earn an A+ from the Better Business Bureau (State Farm gets a B+).
But customer complaints show a mixed level of satisfaction with some of these life insurance companies. Columbus, John Hancock and State Farm are rarely found at fault in life-insurance customer complaints, according to 2009 data from state insurance regulators comparing them to the national median. But Western & Southern was found in the wrong more often than the median among life insurance companies.
State Farm is one of "The Ten Worst Insurance Companies in America," according to the American Association for Justice, a trial lawyers' group. However, AAJ largely faults State Farm's homeowners' insurance, saying the company used "delay, deny and defend" tactics to avoid paying up when people lost their homes in three natural disasters (Hurricane Katrina, a California earthquake and a series of tornadoes in Oklahoma). At FreeAdvice.com, about half of the 900 people who post ratings for State Farm are satisfied and half aren't; about 200 of them say they have life insurance policies with State Farm.