In 2019, Americans spent $679 billion on life insurance premiums and annuities. This is more than they paid for all property and casualty insurance combined. Life insurance is a core component of many Americans’ long-term financial plans, so choosing a dependable insurance company is key. These companies are also known for being stable and reliable, so consumers continue to choose them over others. According to our list, ten insurance companies own more than half the market share.
However, simply because a company has more policies than its competition does not mean that it is the best. There are pros and cons in choosing large or small life insurers. Let’s start by looking at the largest U.S. life insurance companies. Next, we will talk about why choosing from this list might not be the best decision.
List of life insurance companies
The National Association of Insurance Commissioners (NAIC) keeps an updated list of the largest life insurance companies. This list is ranked by market share. It is calculated using the annual premiums.
Northwestern holds top place, writing well over $11.2 billion worth of premiums and holding 6.48% of market share. New York Life and MetLife are in close pursuit, writing 11.053 and 10.767 billion claims respectively, although both companies fail to hold the top-tier ratings that Northwestern boasts. You will also find many other life insurance companies on this list.
How to choose between large and small life insurance companies
When choosing the best life insurance company, is it best to stick with an insurer on the list of life insurance companies who write the most premiums? Not necessarily. While there are certain benefits to being with a large insurer, it is worth looking at smaller companies.
What should you look beyond size?
A large life insurance company will have greater financial assets, which means they are more likely to achieve financial stability. However, this does not mean that a bigger life insurance company will be more stable. You should verify the financial stability rating of the company. This is a great indicator of how efficient and reliable a company will pay your claim.
AM Best rates the ability of insurance companies to meet their insurance obligations on a scale from A++ to D. The scores A++ and A+ are considered “Superior”; scores of A and A- denote an “Excellent” rating.
Other factors are also important to be considered. Other factors that could help a company stand out include its business ethics, community involvement, and technology development.
Selecting a large life insurer company
Life insurance companies with large numbers of employees tend to be older. MetLife, the largest of all life insurance companies, was established in 1868. This company is a well-respected one, having written policies for over a century.
Large life insurance companies often offer digital tools that are unmatched by smaller rivals. You might be able, for example, to manage your policy via a smartphone app and get instant quotes online from companies that have the resources. Most of the time, smaller companies don’t have the resources to create advanced technology tools.
Similar to the previous point, bigger life insurance companies may offer better customer service. With the help of mobile apps or live chat, you may be able contact a representative directly from your smartphone. If you prefer to call, however, large companies often offer extended phone hours and even 24/7 support.
How to choose a small life insurance provider
Small life insurance companies, on the other hand can offer more personalized customer service because they have built stronger relationships with their customers. You might be able to work with the same representative for many years, or even decades, if you do business with small life insurance companies. A professional who is more familiar with your needs can make better recommendations. They also provide friendlier service.
Sometimes, smaller life insurance companies offer more specialized coverage. For example, some small life insurers are created specifically for certain groups such as military members or educators. If you need a specific type of coverage such as critical illness or final expense coverage, a small specialty insurer may be the right choice.
Last, but not least: If you’ve been denied coverage by a major life insurer, it might be worth contacting smaller competitors. Large life insurance companies can afford to deny customers, but small businesses often need to be more flexible to win new business. A smaller insurer may be willing to waive your medical exam or ignore the pre-existing condition that led to your application being rejected elsewhere.
Questions frequently asked
Which is the biggest life insurance company?
MetLife, the largest life insurer in the world, is now the number one. MetLife has a market share of 13 percent in the life insurance industry and writes over $95 billion annually in premiums.
Is it better for me to choose a large life insurer company?
A large life insurance company might be a good choice for you. Larger insurance companies have greater financial assets and better chances of long-term stability. They are also more likely to be in business for longer periods of time. Customers may also find that major life insurers have more resources such as apps and digital tools, and may be able to access customer service faster.
What are the benefits of a small life insurer company?
A smaller company may offer life insurance that has more benefits. You may find that smaller companies offer more tailored coverage. A smaller company will offer personalized service. In some cases, smaller companies may be more accommodating to people who have been denied insurance for life by major insurers.
