The life insurance market in the United States is both massive and highly competitive. Though bigger may not mean better, either for consumers or for investors, it does imply a degree of longevity and financial stability in the life insurance business.
Life insurance is a policy or contract that guarantees the customer or the insured’s beneficiaries a sum of money outlined in the insurance policy. In exchange, the customer agrees to pay periodic premiums or payments to the life insurance company. The best life insurance policies and companies can be helpful since they can provide a measure of security for a policyholder’s loved ones by providing financial support to pay for funeral expenses and pay off debts.
Outlined in this article are the eight largest insurance companies in the United States. However, please remember that the precise ranking order of our group is based on the total volume of premiums written and may change frequently.
According to a 2021 NAIC report, Northwestern Mutual, New York Life, Metropolitan, and Prudential are the four largest life insurance companies in the United States, all together holding 31.09% of the market.
The next biggest life insurance companies are Mass Mutual, Lincoln National, State Farm, and John Hancock, which together hold about 17.93% of the market.
Some insurance companies offer riders, which are benefits added to policies, allowing for customization.
Some of the insurers offer unique coverage options, including coverage for those who are HIV positive and who have been diagnosed with diabetes.
1. New York Life
New York Life Insurance Company has 8.3% of the U.S. life insurance market share and was the second largest insurance company in 2021.
Apart from its life insurance business, New York Life also sells long-term care insurance, annuities, and mutual funds and operates a growing investment management business.
New York Life is a mutual insurance company and is not publicly traded. It reported $2.2 billion in operating earnings for 2021, a record high. The company also announced a dividend payout of $1.9 billion for 2021. Dividends are cash payments made by companies to their customers.
2. Northwestern Mutual
Northwestern Mutual Life Insurance Company holds 8.93% of the American market.
In addition to its life insurance and other insurance products, the company offers annuities, investment products, and financial planning services. The company reported revenue of $31.1 billion in 2020, up from $34 billion in 2021, up from $11.7 billion in 2020.
As a mutual insurance company, Northwestern Mutual is managed for the benefit of policyholders rather than stockholders. Policyholder benefits amounted to $11.7 billion in 2020, up from $11.5 billion in 2019. The company is privately owned and announced its largest dividend payout of $6.5 billion for 2022.
Metropolitan Life Insurance Company (NYSE: MET) is a publicly traded insurance and financial products company. Better known as MetLife, it is the third-largest life insurer in the United States, holding 7.18% of the market share.
MetLife offers term life, group universal life, and group variable universal life insurance as well as accidental death plans.
The company also has a wide array of other insurance products available, from health to home. More than an insurance company, MetLife provides financial products, like investment and retirement plans as well as helping small businesses give benefits to their employees.
For the fiscal year 2021, MetLife had a 9.7% return on equity and a $77.12 book value.
Prudential Financial, Inc. (NYSE: PRU) is a publicly traded financial services conglomerate offering insurance products, annuities, mutual funds, investment management services, and other products. The company was founded in 1875 and operates in over 40 countries in North and South America, Europe, and Asia. Prudential had a 6.66% market share of all life insurance companies in the United States in 2021.
Prudential offers several types of life insurance, including universal and variable universal life. Prudential’s term life insurance comes in four options: SimplyTerm, Term Essential, Term Elite, and PruTerm One. The first three options are personal policies with SimplyTerm providing basic coverage and the other two offering customizations and riders. The fourth option, PruTerm One, is specifically designed for small business owners who are paying off short-term loans.
Prudential reported a net income of $7.72 billion in 2021 versus a net loss in the prior year of $374 million due to the challenging environment during the coronavirus pandemic. Prudential had assets under management totaling $1.742 trillion in 2021 versus $1.721 trillion for the prior year. The company plans to pay nearly $11 billion in capital to shareholders, including in the form of dividend payments.
5. Lincoln National
Lincoln National Corp. (NYSE: LNC) is a financial services company offering life insurance products, long-term care insurance products, annuities, and retirement plan services. It does not operate outside the U.S. The company and its subsidiaries are marketed to consumers under the Lincoln Financial Group brand.
Lincoln National has 5.2% of the 2021 life insurance market share.
In their annual report, Lincoln National reported $660 million in written life insurance premiums versus $630 million in 2020. Lincoln’s net income for 2021 amounted to $1.4 billion, up 64% from $499 million the year before.
Massachusetts Mutual Life Insurance Company, known as MassMutual, was the fifth biggest life insurer in the United States in 2021.
MassMutual offers a variety of insurance products, including whole life, universal life, term life, and variable universal life insurance. The company also offers disability and long-term care insurance.
In addition to insurance, MassMutual provides a full range of financial products, such as annuities, investments, wealth management, and workplace benefits, to employees through their employers.
In 2021, the company earned nearly $20.2 billion in income from insurance premiums and $30.4 billion in revenue. As a result, the company had a net loss of $310 million, which decreased from the previous year’s profit of $128 million.
MassMutual’s market share is 6.29%.
7. State Farm
State Farm is primarily known for its home and auto insurance products, but it is the seventh largest life insurer in the U.S. and has been in business since 1922. However, State Farm is not licensed and does not offer life insurance in MA, WI, and NY. State Farm offers term, whole, and universal life insurance.
The company has 3.29% of the 2021 life insurance market share.
State Farm’s joint universal life policies can pay two individuals, such as spouses.
The company’s whole life insurance has limited payment options, which allow the customer to adjust how and when the payments are made for the coverage.
In 2021, State Farm issued over $212 billion in life insurance products.
By the end of 2021, there was $1.1 trillion in individual life insurance policies in force, meaning that premiums are actively being paid on those life insurance policies. For 2021, State Farm reported a premium income of $5.7 billion, paid out $593 million in dividends to policyholders, and earned $929 million in net income for the year.
8. John Hancock
John Hancock is the eighth largest life insurer in the United States and holds 3.15% of the 2021 life insurance market share. The company is part of Manulife Financial (NYSE: MFC), the largest public company and largest life insurance company in Canada. John Hancock offers two types of life insurance: term and permanent life insurance.
In the 2021 annual report, Manulife reported an increase in net income, earning 7.1 billion compared to 5.9 billion in 2020.