Top Whole Life Insurance Companies for Building Cash Value

Whole Life InsuranceIt’s no big secret that we think whole life insurance is pretty awesome, even though we released a podcast last week declaring that it sucked. Hopefully most of you caught onto our general cheekiness and also learned that we’re not fanatical about the product, i.e. we don’t think it’s the answer to all the world’s problems.

Given this, we often receive questions regarding what company’s whole life products are best to buy. We’ve spent some time carefully approaching this subject. Inevitably, though, we knew the time would come for us to lay down our thoughts and make an official list.

First, a Little Explanation

We have to be very clear here, we are not declaring this list the only carriers from which you should ever buy whole life insurance. No not even close. Instead, this is our list if the carriers to whom you should look if you plan to purchase whole life insurance designed to maximize cash value and use the policy as part of a low risk asset strategy/retirement income play.

We’ll come back to this point in the end as there may be some notable omissions.

The 2013 List

The list consists of 7 carriers for whom we’ve determined—after much deliberation and policy design for prospective clients—are the top contenders for giving you the most potential cash value bang for your incoming premium buck. This list is in alphabetical order.

American United LifeAmerican United Life One America

Also commonly referred to as One America, which is the parent company’s name, American United Life manufacturers a competitive—although somewhat quirky—whole life product. It’s non-direct recognition making it popular among the Infinite Banking die hards, and it also includes a unique declining paid-up additions load.  A feature I’m sure they are proud of, but we’d contend this is actually counter productive as it creates a serious incentive to delay paid-up additions payments, which will decrease overall cash value growth potential.  Time lost can never be regained.

The Guardian Life Insurance Company of AmericaThe Guardian Life Insurance Company of America

Like most of the old mutuals, a company colloquially referred to more commonly as the Guardian, has an extremely long and annoying official name. For Guardian it’s sometimes a little more important to differentiate. As they began a little over 150 years ago as the Germania Life Insurance Company, but dropped that namesake during World War I for obvious reasons. They also have to contend with another life insurance company based on the Caribbean, an industrial manufacturer based in Michigan, and a very well known media company based in the United Kingdom when it comes to name recognition.

Few companies are as dedicated to the use of cash value life insurance as an asset as the Guardian. In fact, they own a web site dedicated to the cause, and paid a lot of money to develop a sales tool to compete with the likes of LEAP® and Circles of Wealth® to help their agents articulate the benefits of owning whole life insurance.

Our only word of caution regarding the Guardian is watch their career agents closely. They are in love with Guardian’s L99 whole life product. This product is rather death benefit focused and lags Guardian’s much stronger 10 Pay whole life product when it comes to cash accumulation and income generation. Their 10 Pay product is designed to accept paid-up additions beyond 10 years (a wonderful feature). In order to do this, the policy has to be properly blended to open the modified endowment contract premium higher, but this is an easy policy design for intermediate to advanced skilled agents.

You won’t see Guardian strongly recommended by most independent agents for various reasons. We work with them, and include them in our recommendations as we truly feel they are a strong contender for cash accumulation strategies. They are direct recognition, but they pioneered the concept, and certainly don’t let it drag them down too much.

The Massachusetts Mutual Life Insurance CompanyMassMutual

When it comes to size and stellar financial ratings, MassMutual has it going on. Commonly referred to within Northwestern Mutual circles as their biggest threat, MassMutual has a super competitive product, and incredible industry reputation.

Non-direct recognition and one of the industries highest current dividend rates makes them appear really great on paper, and they have the historical performance to nullify any questions regarding the possibility of their being a top contender is a fluke.

Surprisingly, as a company, they don’t spend nearly as much time as some other companies on outwardly promoting whole life as an asset class. They have a number of brochures that highlight the benefits of whole life as a college funding tool, and wealth transfer vehicle, but their efforts are more here and there than a concerted and focused attempt like some others.

Despite this lack of highly honed direction, their product is top notch.

The Metropolitan Life Insurance CompanyMet Life

For years MetLife was sort of blah company. They had the whole snoopy thing going for them, which helps when it comes to branding, and as we know branding is the refuge for the weak minded. But they always appeared somewhat lost when it came to identity.

They didn’t really seem excited to jump on the trend wave and embrace guaranteed universal life insurance, nor have they showed any interest in building a competitive universal life product.

They dabbled a bit with the variable annuity business, built a decently competitive product and actually attracted a lot of money to it, more so because of their name and large distribution network.

Despite being a demutualized public company, they’ve kept their participating whole life product, which is a very rare move. But they were often ridiculed by the true blue mutuals for both being a public company and for having a rather lackluster whole life product.

And then something changed.

Then they rolled out this product called Promise Whole Life, and suddenly it looked like Snoopy wanted to play whole life insurance with the big boys. We have it on pretty good authority that they designed their Promise 120 product specifically to edge Northwestern out on price, touché Snoopy, touché.

And then something changed, again.

MetLife underwent another renaissance just this year when they rolled out three new whole life products all focused on shorter payment periods and better cash performance. We honestly didn’t expect a lot out of them, but knew the products were new so we had to place them into the rotation of evaluated companies. Wow were we surprised.

Their paid up at 65 whole life product is an incredible income generator. And their 10 Pay, though much more restricted with respect to available design features vs. Guardian and MassMutual, is no slouch.

We’ve been told that Met spent some time recruiting executive talent to once again be a strong contender in the whole life insurance space. What we’ve seen so far would indicate they made some very good hiring decisions.

Northwestern Mutual LifeNorthwestern Mutual Life

We know some of you are going to raise an eyebrow at this. Northwestern Mutual made the list? The company at which we constantly poke fun? Yup, they did. And there are some very good reasons why.

First, let’s be clear about something.  Our contention with Northwestern is less about them functionally as a company, and more about their undeserved sense of self-excellency and self-importance. Their cult-like atmosphere and belief that NML could never be beat out by another company, especially some of those smaller boutique types that actually manufacturer really great products, is especially annoying due in large part to my own character idiosyncrasies (i.e. some of us very much believe that numbers matter more than company kumbayah BS).

Putting aside the fact that many of their agents tend to be intellectually dishonest with themselves, Northwestern doesn’t manufacture a bad product. It may not typically be the best as evidenced by our personal review of the products available, but its certainly no where near the worst, and Northwestern at least holds the notion of whole life as a strong low risk asset as an important feature to the product.

Here’s the other thing, and I really wish every other carrier in the industry would send someone to Milwaukee to study this Northwestern jewel.

They have incredible customer service.

And I don’t just mean they are good at it. I mean like holy cats I love having to call them for something. They may not have written the book on how to train agents to be less obnoxious, and they may not have written the book on how to build the absolute best whole life product. But they certainly did write the book on how to excel at customer service, and I’d implore other carriers to read it.

Ohio National LifeOhio National Life

Ohio National is a company that we adore and dislike almost in equal parts. They actually manufacture a really great product for cash accumulation purposes. And we’d love to be able to show people what it can do, unfortunately we can’t.

Whoever built their policy design (aka illustration) software was either pressed for time or got fired halfway through and they decided to go with what they had. To put it in more direct terms, their design software sucks.

Additionally annoying are strange limitations on paid-up additions that seem extremely arbitrary, though we’ve been reassured and have in practice discovered these limitations are circumvent-able. Still it’s extremely difficult to part with several thousand dollars of your money each year on a company for whom the agent/broker can only say, “trust me it works out better than this in practice.”

One big red flag we’ll note here. This company, and many of its agents are in love with their Prestige Max product. They like to suggest that it was designed to be maximum (i.e. MEC) funded without requiring the agent to do any tweaking. On top of that, it comes with this great “preferred loan” provision that reduced the policy loan interest rate to increase your potential income generation.

Sounds great, but a lot like Guardian and their strange love of one product that really is only so-so for our purposes, so too does Ohio National have a better product they usually aren’t telling you about. It’s their Prestige Xcel Plus (and the plus is crucial as that’s the product that can be blended) product. It’s a nasty product to design due to Ohio National’s terrible design software, but that’s where you want your money going if you’re doing this for cash accumulation and eventual income generation.

The Pennsylvania Mutual Life Insurance CompanyPenn Mutual Life

We remain amazed at Penn Mutual. Their career force is sitting on one of the best whole life products for cash value accumulation we’ve seen and no one there seems to be aware of this fact. The product is incredibly flexible, and has the most solidly built income-generating features of which we are aware.

Instead, most of their career agents are busy talking about guaranteed universal life insurance, and indexed universal life insurance. There’s nothing wrong with that, and indexed universal life can certainly be a strong contender for life insurance as an asset class, but their products aren’t as superlative in either of these categories (used to be but aren’t any more) as they are in the whole life space.

I suspect someone has figured out the superior strength of their whole life contract as Blease data shows us the vast majority of their whole life sales come from brokers and not their career agent sales force—a very unique result when compared to the other mutual companies with a career agent system.

Their paid-up additions rider is far more flexible than anyone else on the list, making those old worries about being committed to too large an outlay (something that has followed whole life for years) pretty much insignificant when designed properly.

And that’s the List

Call it the lucky seven if you wish.  These are the companies for whom we’d be most comfortable placing anyone’s money if cash accumulation is the key goal. There are some companies for whom people might feel we’ve snubbed. Truth is we’ve looked at them all and made this determination after much deliberation and real life comparing for prospective clients.

If a company isn’t on the list its either because they tend not to focus their whole life product on cash accumulation or they simply don’t have a product that we’ve ever seen compete well against these seven.

[texthighlight color=”blue-vibrant” ]Would you like help with setting up a policy for cash accumulation purposes?  Contact us and we’ll be happy to help you out.[/texthighlight]

Rank Order?

We’re sticking with reporting these companies in alphabetical order and not in order of who we think is the best and the worst. The reason is simple, different circumstances place them in different order.

We don’t always find that one company is always on top, and so we can’t categorically declare one better than the other.  We can only point out who among all the possibilities tends to come out near the top.

In the future, we might get a little stricter in our process and cut it down to a top five or maybe even a top three. For now, we wanted to answer the question: of all the possible carriers, whom would be okay to look to for the purpose of focusing on cash accumulation?

We will be updating this list each year, so if we find that we need to make an addition or subtraction, we’ll do just that. For 2013, these are our top contenders for whole life insurance when focusing on cash accumulation or income.

20 Responses to “Top Whole Life Insurance Companies for Building Cash Value”

  1. Paul Cohen says:

    Brandon, As a broker for the last 30+ years and writing with most of the top carriers, I certainly do appreciate the value of WL insurance and even a properly structured and run UL; but your review of Ohio National is not all that accurate. I’d be happy to run any Ohio National illustrations for a comparison and answer any specific questions you or your readers may have.

    • Brandon Roberts says:

      Hi Paul,

      I’m not sure how my review of ONL could be inaccurate. I’m certainly sure you’re not contending my assertion that they have a great product. So it must be an issue with my comments regarding their software.

      ONL’s software does not allow: a deletion of the plus rider, reduction of death benefit, RPU status on the plus product, a max income solve for income with the plus product, a minimum db solve for specified premium, a variable PUA rider illustration for the plus product, an explanation on how the term insurance is reduced over time or any indication on when it’s projected to be replaced by PUA death benefit, and it very annoyingly makes me input client data when I just want to run some quick numbers.

      I hate their software. I’m an end user. This is feedback, best to think of a way to improve upon things and make end users happier with services than tell them they don’t understand them. I understand them quite well. I’ve written several blended policies with ONL. I’ve brought my dislike to ONL’s attention numerous times, and the answer I get from the Home Office is, “yeah, we do have some restrictions, you should tell your client about our incredible ratings and general account performance.” :x

  2. Albert Moore, ASA, MAAA says:

    Brandon, I am responsible for developing our illustration capabilities at Ohio National. Surveys indicate that 71% of our users find our software above average or excellent to use. That means that 29% of the users could suggest improvements. The most recent survey of users would suggest that 6% would agree with you that our software sucks! There are several points you make which are valid and indeed would be improvements to our software. Namely, allowing RPU on Plus policies will be an improvement. Thank you for the feedback. Also, dropping the Plus rider after the 7th year (avoiding some unpleasant MEC complexities) would also merit consideration. I can see the value. I also agree with you that Ohio National has excellent products. I do not agree that I should be fired! Some of your comments touch upon functionality that are rooted in sound business practices. Finally, we strive to keep communication channels open and I was somewhat disappointed to learn that you had suggestions that may not have reached my desk. I take great pride in our organization’s responsiveness to our partners. Look for the RPU enhancement this fall. If you would like to discuss other improvements please contact me.

    • Brandon Roberts says:

      Hi Albert,

      Thanks for stopping by and taking the time to bring this information to us. First I’d like to clarify that I didn’t suggest you should be fired. I said that the software seemed as though the person designing it was fired half way through the development process.

      I’m very happy to hear that these improvements are forthcoming.

      As far as the number who are satisfied vs. those of who are not, there’s an overwhelming majority of agents who don’t design whole life policies like we do, that doesn’t make what they do right just because they are in the majority.

      Your willingness to address this and take the time to type up what you did proves that Ohio National is an upstanding company and you are an upstanding individual who assists in making this fact so. We are delighted to be able to shine the light on this at The Insurance Pro Blog. Keep striving to make things better, and if there is more we can provide to assist with this, we’re more than happy to lend a hand.

  3. David Simpson says:


    I have the exact same complaints/suggestions regarding Ohio National and have had the exact same response from them…that’s the way we work, deal with it. Needless to say, I looked for other carriers, but would love to do more with Ohio National but hate trying to design cases with them.

    I appreciate your insights into Prestige Xcel Plus and may check that out.

    Could you tell me which companies on your Lucky 7 allow independent reps?

    Many thanks and great review!

  4. "T" Allen says:

    Have you ever heard of the Lafayette Life Insurance Company? They offer similar programs as discussed above. Thnaks

    • Brandon Roberts says:


      Yes we’re very familiar with Lafayette Life. There are a few reasons they do not make our list.

      • "T" Allen says:

        Is there something “bad” that would eliminate Lafayette Life Insurance Co from your list. I have an active policy and am concerned! Thanks

        • Brandon Roberts says:

          Our biggest problem has been a very loose approach to MEC testing that the home office has communicated to me and others. Their products are so-so in our comparisons. Their customer service is eh.

          As far as stability of the company goes, I don’t think they are going anywhere anytime, soon. I wouldn’t worry too much about the company to in terms of that, or in terms of the product performing really badly compared to what you are expecting.

          So there were probably better options when you made the purchase, but now that you are in, I’m not so sure there’s much you should do or worry about.

  5. Miriam says:

    What do you think of a company called LSW?

    • Brandon Roberts says:

      Hi Miriam,

      Not exactly a top tier company. Their product looks pretty good on paper. It has a fair number of functional annoyances, and the financials are a tad iffy in our book.

  6. TheKing says:

    I am looking to write with another whole life company. I currently write with Lafayette. How is Mutual Trust? What makes Met better than Lafayette?

    • Brandon Roberts says:


      I think I’d stick with Lafayette Life over Mutual Trust Life. I would use this list above to guide you in adding whole life carriers. Met over Lafayette Life in large part due to the company size and, underwriting capacity, history with the product, customer service, and product design.

  7. sean swords says:

    I was pleased to see the Guardian comments. As a CFP working with the highly compensated/ high net worth clients, I have used Guardian as a core company for years. I analyzed the top-ten highly rated companies twenty years ago, and concluded that Guardian consistently outperformed year after year, particularly when doing twenty year IRR look backs on Whole Life products. There’s no arguing with actual performance, who cares about illustrations.

    Cannot tell you how pleased I have been to also use their “own occupation” disability contracts as well. These have always paid out with very little hassle, compared to Provident, Unum, Paul Revere et al, a very important reality for my doctor and dentist clients.

    The downside, of course, is extremely ponderous and detailed underwriting, which is partially why the financials are so good: excellent risk management and
    investment yield equals a jewel of a company.

    Separately, why isn’t NYL also on the list? They do not perform as well as Guardian, but still are a substantial company, certainly financially stronger the Met Life, who are broadly marginal at best.

    • Brandon Roberts says:

      Hi Sean

      Re: NYL

      They really don’t like the cash value life insurance play based on blending, which I’d contend is the only way to approach it.

      I really wouldn’t label Met as marginal at best. They generate almost more investment income in a quarter than Guardian has in assets. They are both good companies, especially when cash values are the focus. NYL is better suited for the permanent death benefit arena, and there is nothing wrong with being more focused on that side than the other.

  8. Maureen Vitiello says:

    Oh life insurance!

  9. Mike says:

    Hi Brandon,
    I’m surprised I didn’t see New York life’s custom wl policy in your review, which is geared toward building cash value. Any particular reason. Thanks!

    • Brandon Roberts says:

      Hi Mike,

      There is actually a reason they didn’t make the list. And we have plans to detail while they and many others didn’t make the list late this year. Stay tuned for that.


  10. ed ellingson says:

    Please comment on the Fraternals, particularly Thrivent which has just hugely expanded it’s customer base . New
    York State insurance Dept. brochure used to have a one sentence reference: ” Always check your elegibility for fraternal insurance before purchasing . “

    • Brandon Roberts says:

      Hi Ed,

      Sorry, but I can’t comment or reply to such a vague question. If there is something more specific you’d like an opinion on, we’d be happy to weigh in.

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