What Does Liquidity Refer To In Life Insurance Policy

Helen Skeates
Helen Skeates
37 min read

To what do life insurance policies refer when they talk about liquidity? The liquidity of a life insurance policy is its ease of access to its cash value in the event of a claim. You have found the right page if you were searching for an explanation of these terms.

Perhaps you’ve heard a knock at your door and opened it to find a group of well-dressed people standing there. It’s not like anyone invited them, but they do sometimes try to sell you life insurance.

The answer is yes, life insurance can be used for things like medical expenses, funeral costs, and even accidental death. Insurance is the funds you set aside that increase in value over time.

Depending on the specifics of each policy, you may receive a substantial financial boost in times of dire financial need. But some of the terms in your contract may leave you scratching your head. Let’s get rid of one of them, then.

What Is Life Insurance?

Purchasing life insurance involves entering into a contract with an insurance company. Insurance companies typically offer death benefits in exchange for regular premium payments. (Oof!)

All right, that’s not exactly a cheery thought to ponder. Nonetheless, pay attention to this: You purchase life insurance not because you expect to die soon, but because you care about the well-being of those who will outlive you and need financial protection in the event of your passing. Life insurance comes in two main forms: term life (which is highly recommended) and permanent coverage (which is not a good choice).

Unpacking Liquidity In Life Insurance Policies

Life Insurance Basics

You may be wondering why we think term life insurance is the best option. The explanations are straightforward and elementary:

  • It’s the most cost-effective way to secure life insurance on a budget.
  • Term life insurance serves its single intended purpose: to replace lost income in the event of the policyholder’s death.
  • Your loved ones won’t have to worry about making ends meet during a challenging time.

Moreover, as we’ll see as we explore the other types of life insurance, they’re either significantly more costly or convoluted.

When researching life insurance, have you come across a lot of technical jargon? Reading a life insurance policy can be a daunting and time-consuming task, and we can relate to that. However, there are only a handful of basic concepts central to understanding life insurance:

  • Coverage agreement between you and your insurer; also known as a “policy.”
  • Insurance premiums are the regular payments you make to keep your policy in force.
  • In most cases, the policyholder is also the insured person, but you can also purchase insurance on behalf of someone else.
  • In order to receive the death benefit from your life insurance policy, you must file a claim with the company.
  • The payout from a life insurance policy upon the policyholder’s death is known as the “Death Benefit.”
  • Whoever you designate to receive the policy’s death benefit upon your passing is known as a “beneficiary.”

Simply put, the insurance company promises to pay the death benefit to the policyholder’s beneficiaries if the policyholder dies while premium payments are still being made.

A Brief History of Life Insurance

The first known American life insurance policy was issued in the 1760s, so the practice has been around for quite some time. The two most common types of insurance policies have evolved over time to resemble the term life and permanent policies we’ve already discussed. However, just because both are common does not mean they are equally beneficial. How do they all function? Let’s take a look!

How Does Term Life Insurance Work?

As long as you pay your premiums on time each month, the insurance company will pay out a set amount to your beneficiaries upon your death. Term life insurance, like homeowner’s or auto insurance, is a way to protect yourself financially from the kind of catastrophic events that everyone experiences at some point in their lives.

The insurance company considers a number of factors when determining your premiums, including:

  • Age
  • Health
  • Probability of living to an old age
  • Choices in how one lives their life can sometimes

In light of these considerations, we advise that you enroll in a term life insurance policy while you’re relatively healthy and young. This is the type of insurance that increases in price with time.

Take Justin, a healthy 35-year-old who earns $50,000 a year and doesn’t smoke. Because Justin was prudent and insured himself for 10 to 12 times his annual salary, his family will receive a payout of $500,000. He bought coverage for 20 years because he has young children. (He expects his efforts to pay off his debt and save for retirement to bear fruit by the time he’s in his 50s, and he expects to be self-insured once his children have left the nest.)

Who do you think will receive the $500,000 life insurance payout if Justin passes away before the end of his 20-year term? You guessed it: his family! (While most people choose family members to receive the death benefit of a term life policy, you can also designate friends, charities, or trusts.)

How Does Permanent Life Insurance Work?

The simple answer is that it’s not that easy to answer your question. That’s in part because there are so many variations of permanent life insurance, and in part because the features vary widely across the board.

The primary distinction between permanent and term life insurance is that with permanent, you are guaranteed coverage until death. We can appreciate that this may sound like a more permanent form of service. But believe us when we say that the only reason it sounds better is because it provides a long-term answer to a problem that, for most people, is only temporary (the possibility of dying before amassing sufficient wealth to replace lost income). Many people think permanent is more cost-effective. But you’re dead wrong about that.

Here’s the deal: despite what you may have heard, term life insurance will almost always be less expensive than permanent life insurance. Term life insurance is a basic policy that pays out a set amount of money if you die within the policy’s specified time period. Simple to grasp and reasonably priced.

However, most forms of permanent life will be prohibitively expensive and will attempt to perform multiple functions. In addition to a death benefit, permanent life insurance may provide you with a savings account, a retirement fund, or other investment opportunities. It’s no surprise that the price of these items rises.

The various kinds of permanent life insurance are detailed below. (Again, please avoid these regulations!)

  • For the rest of your life
  • Global existence
  • Conditional immortality

The Truth About Life Insurance

The truth is that life insurance isn’t meant to be a savings vehicle for later in life. This protection is a form of insurance. Therefore, insurance is a means of financial security against foreseeable perils. When it comes to your long-term financial plan, however, investing should be treated as a separate but complementary component. The problem arises, however, when businesses or policyholders try to use life insurance for purposes other than replacing the policyholder’s income.

It is a bad idea to combine insurance and investing, as doing so will result in higher premiums and lower returns (for example, mutual funds are better places to put money than a savings account attached to a whole life insurance policy).

Stick with the tried-and-true method of purchasing life insurance: investing in low-cost term coverage whose sole purpose is to replace your income in the event of your death. All done!

Is it necessary for you to purchase life insurance? Almost everyone has a need for life insurance. Life insurance is a crucial component of your financial safety net at any age.

Let’s see if we can figure out where you belong:

The Young Professionals

After your passing, your loved ones will be responsible for paying off any outstanding bills in your name. However, if you have no outstanding debts and no dependents, your only real financial concern is likely to be funeral expenses. And if you’ve already enrolled in a company-sponsored group life insurance plan, you might not have to rush out and buy your own policy just yet.

The Newlyweds

Congratulations! You are committed to each other through every stage of your new life together. “Til Death Do Us Part” isn’t the final chapter, though. You and your partner should each have a life insurance policy.

It’s not just about making sure the other person’s bills get paid if you die; it’s also about making sure they have something to look forward to while they grieve. Invest in a sufficient amount of life insurance to safeguard their financial future.

The Parents

Even if only one parent works outside the home, it’s important to have health insurance for the whole family. There would be serious consequences to the family budget without the presence of a stay-at-home parent. These days, the price of childcare isn’t cheap.

Think about how much money would be needed to keep the house running, send the kids to college, and possibly pay off the mortgage in the years after you or your spouse passes away. We know that this calm is something you seek and need.

The Retirees

You might have substantial retirement savings by now. It’s possible you could be doing well enough financially that you don’t even need life insurance. That’s an ideal location, for sure.

But suppose you are still working on your mortgage and saving for your retirement. Would the money in your savings accounts be enough to support your family if you passed away today and your spouse lost access to your income?

How Much Does Life Insurance Cost?

Life insurance premiums are affected not only by the policy you select (term or permanent), but also by factors such as your age, health, and way of living.

Consider Sarah. She’s in her 30s, she doesn’t smoke, she’s healthy, she’s married, she has a kid, and she makes $40,000. In general:

  • A 20-year term life insurance policy with a $400,000 death benefit would cost her about $18 per month.
  • She could pay around $100 a month for a permanent policy that provided a death benefit of $125,000.

Your life insurance premium will be determined by the following factors:

  • Age
  • Gender
  • Health background information
  • Weight
  • When one smokes
  • Skydiving, shark wrestling, and other potentially fatal pastimes may be indicative of a reckless way of life.
  • If you frequently visit potentially dangerous regions,

If you aren’t purchasing a no medical exam life insurance policy, the insurance company will schedule a medical exam with you after they have this information.

Now that you know their motivations, what can you do to lower your premium? You can’t do much about your age, but you can reduce your premiums by ditching bad habits and replacing them with healthy ones like regular exercise and a healthy diet.

How Much Life Insurance Do I Need?

Dave Ramsey and other financial gurus advise choosing a death benefit equal to 10-12 times your annual salary. The future of your family depends on your success in this endeavor.

Consider Sarah, from our earlier example, and how much her family would benefit from a death benefit equal to 10-12 times her annual income:

  • Sarah earns $40,000 per year, and the payout from her life insurance policy is $400,000.
  • Sarah’s family could put the $400,000 into a mutual fund that yields 10% if she were to pass away.
  • The annual return on that investment could equal Sarah’s starting salary of $40,000.

Sarah’s annual salary could be covered by the interest her family earns. And the principal could remain in the account indefinitely, while they draw on the interest to get by in the absence of Sarah.

This gives Sarah’s family the financial stability and comfort they need during this trying time.

What Type of Life Insurance Is Right for Me?

In case it wasn’t clear from our previous discussion of the two main types, we only recommend getting term life insurance. It expires right around the time you no longer need it, and it’s cheaper than the permanent kinds of policies (so you can invest the difference in retirement accounts). When would that happen, exactly?

When you have enough money and assets to stop needing insurance. To be self-insured merely implies the following:

  • You have saved up three to six months’ worth of expenses for the “Four Walls” (food, utilities, shelter, and transportation).
  • Is your child leaving for college or moving out on his or her own?
  • Your savings for retirement are doing so well that the interest you earn each year could effectively replace your salary.

How Do Life Insurance Payouts Work?

No one wants to deal with formalities after a close family member or friend has passed away. Planning ahead for the life insurance payout could be helpful.

To file a claim with a life insurance firm, write them an email or letter. A certified copy of the policyholder’s death certificate issued by the hospital or the county or municipality in which the policyholder died must be provided by the beneficiary to the company.

The good news is that there is no statute of limitations on receiving a payout from a life insurance policy. You and your loved ones can complete this undertaking whenever is most convenient for you.

How about the payout method? You have the option of paying in one lump sum or in installments. Taking the payout in installments has a number of drawbacks, and it doesn’t give you the same degree of control that a lump sum does, so we strongly advise against it.

Liquidation In Life Insurance Policy

What, then, does “liquidity” mean in the context of a life insurance policy? In the context of a life insurance policy, the term “liquidity” refers to the ease with which policy assets can be converted into cash. Property such as a home, car, or valuables would be considered an asset.

However, while most people only require basic cash coverage in terms and policies, those with more complex needs can benefit from the liquidity offered by life insurance.

Is Liquidation A Good Or A Bad Thing?

There are pros and cons to everything that has been established. If you’re here because you want to know whether or not you should get life insurance that includes a liquidation option, you’ve come to the right place. First, though, we’ll talk about the pros and cons of using it.

Understanding Liquidity in a Life Insurance Policy - The Reardon Agency

#1. Benefits

When making a decision, we frequently weigh the potential advantages of that option. For the sake of our well-being, our loved ones, or ourselves. So, in your opinion, what are the advantages of life insurance cash value? Read on.

Benefit #1. Survivor needs

Life insurance’s primary function is to ease the financial burden on a policyholder’s loved ones in the event of their untimely demise. The insurance company may pay for the funeral or give the family money to help with bills or lost wages right away.

Benefit #2. Estate needs

Settlement expenses related to estates are most frequently encountered in families with larger estate shares. You can avoid selling the estate and pay for the settlement costs with the tax-free money from insurance.

Benefit #3. Business needs

In the same way that an estate can benefit from life insurance proceeds, a business can use life insurance proceeds to buy out a deceased shareholder’s share of the company. That’s the norm for people who need help with business matters.

Benefit #4. Corporate life insurances

Insurance policies owned by a corporation can be funded in part by the liquid assets of the business. After an employee’s passing, the insurance’s tax-free cash value could be used to pay for the executive’s severance package.

#2. Drawbacks

Nothing is perfect, and that includes everything. Even in life insurance, the liquidation process could have some kinks. But there are times when you can choose to ignore them and focus on the bright side. No, I don’t think so; you should weigh the benefits against the costs.

Disadvantage #1. The business may close down

Since the business is now considered a liquidation asset, it could be shut down if the owner passes away. It will also be prohibited from conducting business as usual. The company cannot rebrand under its current name. However, it stands to reason that when a company shuts down, its employees will also be out of work. This could necessitate dividend payments to some shareholders.

Disadvantage #2. You might lose everything

If the company has established a solid reputation, you stand to lose more than just trading and other assets if you shut it down. However, in the event of business liquidation, directors’ personal credit histories are of no relevance. Don’t worry, though; this only occurs rarely and only for those with very large insurance payouts.

Kinds Of Life Insurance With Liquidity

There are likely many options for life insurance in your region. But first, let’s talk about the three most common types of cash value life insurance.

#1. Whole life

Whole life insurance is an investment product that grows at a minimum guaranteed rate determined by your insurance company. You can withdraw the full amount you deposited, plus interest, just like with a traditional savings account.

#2. Universal life

Universal life insurance, on the other hand, can increase in value thanks to interest that fluctuates with the performance of a market index. Your service provider also controls the minimum and maximum levels. For high-income earners looking to leave a tax-free legacy to their loved ones, this is the best option.

#3. Variable life

Comparable to a stock portfolio is variable life insurance. You could decide to add to the investment and let it gain or lose based on the market’s strength and performance. Okay, that wraps it up! Regardless, not at all related to this topic, but you might be interested in reading this article about the best mattresses for people with arthritis.

9 Best Life Insurance Companies

Best No-Exam Life Insurance: Bestow

We picked Bestow because its term life insurance policies have a higher death benefit than most other companies’ do and there is no need for the policyholder to undergo a medical exam.


  • Very good protection (as much as $1.5 million) with no required physical
  • Applying online with lightning-fast processing
  • Ten- to thirty-year contracts are possible.
  • Extensive 30-day trial period


  • There are no available horses at this time.
  • Provides only term life insurance for purchase.
  • In order to be covered, your age can’t be over 60.
  • New Yorkers are unable to purchase these policies.

If you’re looking for life insurance but would rather avoid a medical exam, we recommend Bestow. Term insurance is the only type of insurance this company offers, so there’s no need to see a doctor or get any sort of medical testing done to apply for or buy a policy. The maximum coverage amount is $1.5 million, which is significantly higher than the maximum for most other no-exam policies.

Your application for life insurance and the premium you pay are both based on the information you provide about yourself and your health, your hobbies, and your way of life. Bestow states that it only takes minutes to get an online quote and buy a policy.

North American Company for Life and Health Insurance, an A rated company, issues the Bestow policies. The Lemonade app and website have been updated to include Bestow’s life insurance offerings. Bestow also provides access to a wealth of informative resources.

Best for Guaranteed Coverage: Ethos

We picked Ethos because it’s one of the few life insurance companies that will consider you even if you’ve had trouble getting coverage elsewhere, like because you’re over 50. In addition, potential customers can get a quote in a matter of minutes without ever having to speak to an insurance agent.


  • Offers both temporary and long-term insurance
  • Policy issuance is guaranteed in some cases.
  • All price quotes and applications are handled digitally.
  • Most policies have a provision for a quicker payout in the event of death.


  • There is a dearth of available data regarding riders that can be added to your
  • Few permanent life insurance policies are available.

Ethos provides a triad of insurance coverages:

  • While medical exams are not required for simplified issue policies, you will be asked to answer questions about your health and medical history.
  • With a guaranteed issue policy, you are protected no matter what your health status may be.
  • A medical exam and blood work are necessary for fully underwritten policies.

Guaranteed issue underwriting is only available for whole life insurance policies, but Ethos offers it for its term policies (no other insurer provides guaranteed coverage for term policies).

Age 65 to 85 is the eligibility age for the guaranteed issue whole life policy. Regardless of preexisting conditions, applicants are guaranteed instantaneous approval for up to $25,000 in coverage.

Many policies have what’s called an “accelerated death benefit rider” that lets policyholders cash in early in the event of a terminal diagnosis.

Best Online Broker: Policygenius

So why did we pick it? Policygenius is a one-stop shop where you can compare and buy term and whole life insurance policies from a wide variety of providers, including many of the top-rated insurers we’ve profiled here. This comparison service promises not to share your personal data with any third parties.


  • Insurer quotes can be compared quickly and easily.
  • According to the company, agents do not receive commission.
  • There are a variety of coverage options.


  • Not all companies offer online price estimates.
  • It’s time-consuming compared to other pricing methods.

With its convenient one-stop-shop approach to shopping across multiple insurance providers, Policygenius has earned the title of best comparison tool and broker. The insurance companies AIG, Banner Life, Brighthouse, John Hancock, Lincoln Financial, Mutual of Omaha, Pacific Life, Principal, Protective, Prudential, SBLI, and Transamerica are all partners of Policygenius.

For those unfamiliar with life insurance, this marketplace provides a wealth of educational materials, such as suggestions for life insurance for those with depression and diabetes. Policygenius is an excellent choice for comparing life insurance quotes because of the tools it provides in addition to its extensive coverage options, which include term and permanent policies.

Agents at PolicyGenius can provide one-on-one guidance if you need it in selecting the appropriate policy or coverage amount. The company claims that because its employees receive a salary rather than a commission, they have no incentive to upsell you or steer you toward products for which they will be paid more.

Best Term Life Insurance: Haven Life

Why we went with it: Haven Life offers a wide variety of term life insurance policies, some of which have extremely generous death benefits. Its plans include extra perks like will-drafting tools that can be accessed online.


  • Provides two distinct term insurance plans: Safe Place; Concise Approach
  • A medical checkup is unnecessary for the Haven Simplified Issue.
  • Maximum term coverage of $3,000,000
  • Benefits and discounts from Haven Plus are included in the Haven Term plan.


  • Insurance policies in excess of $500,000 necessitate medical exams.
  • States like California, Delaware, South Dakota, North Dakota, and New York don’t offer simplified issue policies.
  • Haven Plus is unavailable in the states of (WA, FL, NY, ND, and SD).
  • Life insurance policies are not meant to be used in place of one another.

Haven Life is our top pick for term insurance because of the wide variety of policy durations (10, 15, 20, 25, and 30 years) and coverage amounts ($100,000–$3,000,000).

Haven Life Insurance Company provides two distinct term life insurance plans: Haven Term and Haven Simple. Haven Term comes with the Haven Life Plus rider, which includes a will or trust-drafting service, fitness and sleep tracking apps, and a digital safe for storing important documents.

For those under the age of 64, Haven Term offers coverage of up to $3 million. The Accelerated Death Benefit rider is included in Haven Simple, which is only available to those between the ages of 20 and 55.

Best for Flexible Coverage: Ladder

Why we went with it: Ladder’s versatility lives up to its name. You have the flexibility to adjust your coverage amount as your needs evolve. The lowest monthly premiums begin at just $5*, making it affordable for even those on a tight budget to buy a policy.


  • Term insurance policies can be modified as needed.
  • Term insurance policies from $100,000 to $8,000,000 are on offer.
  • 30-day refund policy instead of the standard 10-day
  • Coverage of up to $3,000,000 with no required medical exams


  • Coverage only available for those under 60
  • Currently, we only offer term insurance.
  • There are no add-ons

Despite only offering term policies to relatively young applicants, Ladder is the most adaptable insurance provider we’ve come across. There are only three steps involved in the online application process, and monthly premiums start at just $5. You are free to cancel your coverage at any time without incurring any penalties from the company.

Ladder has an advantage over competing insurance providers in that its customers can adjust their coverage level and premiums in real time and entirely online. This benefit may appeal to those who are concerned about their ability to keep premiums low in the event their financial situation changes in the future.

Best for Customer Satisfaction and Stability: State Farm

Why we picked them: State Farm is a great option if you place a premium on having a positive interaction with your insurance provider. Its customer service is highly regarded, and it has a proven track record of financial security.


  • Company with the highest customer satisfaction ratings
  • Fewer than usual customer complaints
  • Choices in policy design
  • Accessible simplified issue (no medical) policies


  • Not all coverage options can be quoted online.
  • Most insurance policies necessitate a medical exam.
  • There are no discounts for bundling with other types of insurance.

We recommend State Farm because they are an industry leader and consistently rank high in customer satisfaction surveys. According to J.D. Power’s analysis of customer feedback, they were named the best life insurance provider in 2021. It bested 21 other life insurance providers by providing superior products, customer service, and communication.

AM Best has awarded the company its highest possible rating of A (superior), indicating the firm’s exceptional financial security. Additionally, State Farm experienced an abnormally low number of complaints for a company of its size.

Term, whole, and universal life insurance are all available from State Farm. Although a medical exam is necessary for most of its plans, simplified issue alternatives are available.

Best for Whole Life Insurance: New York Life

That’s why we went with it: New York The options for life insurance cover a wide range of protection levels and durations, from temporary to permanent and even whole life. You can convert your term policy to a permanent one if you decide you need it. It also serves as the insurance company for AARP’s life coverage.


  • Available in a variety of term, whole, and universal life plans
  • There are a number of add-ons that can be made to a policy.
  • Highly Recommended Firm
  • potential for profit.


  • Required to use a representative
  • No price quotes can be found online.

New York Life is the best option for those looking for permanent life insurance, such as whole life policies, though it does offer term life insurance as well. (Permanent life insurance provides a larger death benefit but also earns cash value.) Among the many long-term solutions provided by this firm, universal and variable universal life insurance plans stand out. There are also a number of “riders” available for purchase to further tailor your coverage needs.

Since it is a mutual insurance company, New York Life’s policyholders also have partial ownership of the business. You might get dividends from your policy if it meets certain requirements.

However, online quotes are not available from New York Life. Consult an agent for complete information on coverage options and costs.

Best for Bundling Discounts: Nationwide

We picked them because they offer bundle discounts for multiple types of coverage, including life insurance, which is hard to come by. It has excellent ratings for customer satisfaction and financial stability, and it offers term, whole life, and universal policies.


  • If you bundle it with your home or car insurance, you could save money.
  • Numerous choices of coverage and add-ons for insurance


  • Physicals are mandatory for all policies.
  • Most insurance policies can only be bought through brokers.

A number of independent organizations, including AM Best (which ranks financial stability) and J.D. Power (which ranks customer satisfaction), have recognized Nationwide as an industry leader. Term life, whole life, and universal life insurance are all available. In addition, the policy is highly customizable thanks to its many available riders.

Despite the fact that most of Nationwide’s policies can only be purchased through an agent, the company has one significant advantage over its competitors: a multi-policy discount that can significantly reduce your premium costs when you bundle life insurance with other coverage types, such as home and auto.

What Does Liquidity Refer to in a Life Insurance Policy - InsuranceGenie

Best for Policy Customization: Northwestern Mutual

This option was selected because insurance riders make it possible to extend coverage to dependents, use benefits in unusual situations, or even cancel payments altogether in the event of a serious illness. Northwestern Mutual gives you more freedom to tailor your policy to your needs by offering a wider variety of optional riders than its competitors.


  • Extended roster of add-ons
  • Choices in policy design
  • possibility of gaining a profit
  • Very high ratings from impartial sources


  • Agents are required for all policy purchases.
  • Most people need to get a medical exam
  • Not enough online quote tools

Northwestern Mutual, like many other insurance companies, provides a variety of life coverage options to its customers. It stands out from the crowd thanks to the plethora of available riders that can be added to your policy in order to tailor it to your specific requirements.

Northwestern Mutual, being a mutual company, also distributes dividends to its policyholders. Insurance policies purchased through the firm may be eligible for dividend payments each year.

Northwestern Mutual consistently ranks near the top of industry rankings, as befits a company of its caliber. It has historically received fewer complaints than is typical for a company of its size, and it ranked third in the J.D. Power 2021 U.S. Individual Life Insurance Study out of 21 companies.

Other life insurance companies we considered

We compared life insurance providers based on their responsiveness to policyholders’ needs, breadth of coverage, ease of underwriting, speed with which they settle claims, and overall quality of service.

The following businesses have competitive offerings but did not make our list of top picks due to falling short in one or more of our criteria.


Due to its limited coverage options, Lemonade is not one of our preferred insurers. Its website is also deficient in details about its riders and policies.


  • Monthly premiums begin at $9
  • Totally electronic form submission
  • Cancel within the first 30 days for a complete refund.


  • The age limit has been set at 18-60.
  • New York does not offer term life insurance.
  • This insurer is not likely to accept you if you have a history of cardiovascular disease or cancer.


Due to the stringent requirements for inclusion in Sproutt’s Quality of Life underwriting, we decided against including them in our main list. Insurance coverage, riders, and term options are not described on the company website either.


  • Non-binary people have choices that work for them.
  • matches potential policyholders using algorithms
  • Underwriting based on the Quality of Life Index


  • There is no weekend phone support.
  • If you are overweight or in poor health, your insurance company may refuse to cover you.
  • Filing for bankruptcy can prevent you from obtaining a no-exam policy.

Health IQ

We didn’t include Broker Health IQ on our primary list because its online service isn’t as extensive as others’ and its website doesn’t provide as much information as others’ do. Terms, policies, and riders vary by provider (the company works with over 25 national insurers, including Prudential, Mutual of Omaha, and Transamerica).


  • Find the best deal by comparing 30 different providers.
  • Professional intermediaries will help you through the steps.
  • Membership reward program is available.


  • Customers who want online quotes must be willing to speak with agents.
  • To get cheaper insurance, you either have to change your habits or take a test.


Although MassMutual offers a variety of life insurance plans, they are not included on our primary list because their plans have so few, if any, optional riders.


  • There may be no need for a medical exam if the applicant is young and/or healthy.
  • Provide two long-term care riders attached to whole-life insurance policies.
  • Online term life insurance policies are available instantaneously.


  • Some policies cannot be converted.
  • Only whole life insurance policies pay dividends.
  • Very few, if any, policy add-ons

Guardian Life

Due to its below-average JD Power rating and its limited selection of riders, Guardian Life did not make our main list.


  • Management of your finances and quotes online
  • Accessible HIV/AIDS policies


  • To apply (or withdraw), contact an agent.
  • Guaranteed-issue (no-exam) policies are not available.
  • Options for life insurance with a term focus are the most fundamental.


We don’t include USAA because it is restricted to military personnel and their families. The company has a solid track record in this respect, including favorable complaints records with insurance regulators, despite not being included in the most recent JD Power study of customer satisfaction or rated by rating agencies.


  • Wartime coverage is available for military personnel.
  • Donate to a survivor’s cause
  • Their policies have a high ceiling on their value.


  • Each and every policy requires a medical exam.
  • There are coverages that New Yorkers can’t get.

Mutual of Omaha

Due to its higher-than-average premiums for applicants in good health and/or who are older, Mutual of Omaha did not make our cut. Compared to other insurance providers, the application and approval processes take longer.


  • Presents Estimates via Web
  • Insurance rates that are reasonable regardless of health status, even for cancer
  • Provides a permanent life insurance plan for kids.


  • Insurance premiums for healthy people tend to be higher.
  • You need to fill out an application to find out if a physical is needed.
  • Limited online support materials
  • New Yorkers are somewhat confined in their choices.

Liberty Mutual

For several reasons, including a lack of policy information detail and a smaller selection of term insurance options, we have chosen not to include Liberty Mutual on our primary list of providers.


  • Passport Term (quicker insurance underwriting) is available for instant online approval.
  • Insurance Renewal After the Term Is Up


  • Insurance costs are above average on a monthly basis.
  • There is a lack of policy information on the website.


In a nutshell, what does the term “liquidity” mean when discussing a life insurance policy? Assets that can easily be converted into cash or other liquid forms are said to be liquid. It would be helpful if you weren’t concerned about the drawbacks of liquidity, but it is a drawback for those with more substantial assets.

Always read the fine print, and especially when it comes to insurance, before signing anything. It’s possible you won’t know whether you were actually helped or duped.

Helen Skeates

Helen Skeates

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