Lafayette Life Insurance Company Review

Review of Lafayette Life Insurance Company

Perhaps not as well-known as some of the other top 10 dividend paying whole life insurance companies we have profiled, Lafayette Life is a great life insurance company that you should familiarize yourself with.

When seeking out the best life insurance policies and companies it is important that you get familiar with the various companies available in order to find the right fit for you.

The team at Insurance and Estates has put together many life insurance reviews from the top participating whole life insurance companies to help our clients in their search for the company that best meets their needs, goals, and objectives.

About Lafayette Life

Lafayette Life Insurance Company is a member of Western and Southern Financial Group. Lafayette Life was founded in 1905 as a mutual insurance company.

Being a mutual insurance company means that Lafayette Life is owned by participating policyholders, who share in the ownership rights of the company, as well as take part in the company’s profits through dividends. In contrast, stock companies are owned by the shareholders and are operated in a way as to maximize shareholder value.

Lafayette Life is available in 48 states and the District of Colombia. It currently does not do business in New York or Alaska.

Highlights from The Lafayette Life Insurance Company’s 2025 Update

Financial Performance:

• Operating income from life and annuity operations: $68.5 million in 2023 (latest available data).
• Continues to show strong financial performance.
• Recognized by Investopedia as one of the best providers of whole life insurance in December 2024.

Dividends:

• Record dividend allocation of $123.3 million to eligible policyholders in 2025 (up from $92 million in 2022).
• Increased dividend interest rate by 45 basis points to 5.75% for 2025.
• Marks the 120th consecutive year of paying a dividend since the company’s founding in 1905.

Financial Strength Ratings:

• A+ Superior rating by A.M. Best.
• AA– Very Strong rating by Standard & Poor’s.
• AA Very Strong rating by Fitch.
• Comdex Ranking of 96 out of 100.

Leadership:

• Still led by John H. Bultema III, President and CEO.
• Continues to emphasize financial strength and customer commitment.

Lafayette Life’s Products and Services

Lafayette Life is focused on retirement services, annuities and life insurance.

Types of Life Insurance Policies Offered

Although Lafayette Life is known more for its stellar whole life insurance, the company offers both term life and whole life.

Each type of coverage serves a unique purpose. However, in the debate between term life insurance vs whole life, we believe one product outshines the other.

Lafayette Life Insurance Policies [Plans and Features]

Lafayette Life offers two primary life insurance types: term and whole.

Whole Life Insurance Dividends

Additional cash value and death benefit growth is possible through the use of dividends paid on participating whole life policies. Dividends are not guaranteed. However, Lafayette Life has paid dividends to participating policyholders every year since the company’s inception in 1905, marking 120 consecutive years.

For 2025, Lafayette Life has announced a record dividend allocation of $123.3 million and increased its dividend interest rate by 45 basis points to 5.75%. This significant increase demonstrates the company’s financial strength and commitment to delivering value to policyholders.

Life insurance dividends from a mutual company can be used to:

• Purchase paid up additions to increase your coverage and cash value
• Use dividends to pay premiums
• Earn interest with the company via dividend accumulation
• Receive cash in the amount of the dividend

Additional Benefits of Whole Life Insurance

Tax free life insurance policy loans

Using your cash value as collateral, you can take out a life insurance loan to be used for whatever you need.

Lafayette Life practices non-direct recognition. When you take out a loan, Lafayette Life continues to credit interest and dividends to your total cash value, not the cash value minus your loan. This is a huge advantage for anyone who uses a policy loan and wants to maximize the potential arbitrage available to purchase other income producing assets.

Tax deferred cash value growth

The Internal Revenue Code has a special section for cash value life insurance tax benefits. Under IRC 7702 cash value life insurance grows tax deferred. By taking out policy loans, rather than outright withdrawing your cash value, you can avoid ever paying taxes on your cash value growth.

Tax free death benefit

The life insurance death benefit is paid income tax free to your beneficiary. The death benefit is taxed is if your estate exceeds the federal estate tax exemption limit or if your estate exceeds your state’s inheritance tax. Therefore, if your estate is large, proactive asset protection planning is necessary.

Lafayette Life Whole Life Insurance Riders

Accelerated Death Benefit Plus Rider: can access a portion of the death benefit for a qualifying terminal illness, medical condition, or chronic illness.

Long Term Care Rider: the long term care rider provides a monthly benefit if the insured cannot perform two of six ADLs.

Paid Up Additions: allows you to purchase additional “paid-up” insurance.

Guaranteed Purchase Option: allows the purchase of additional life insurance without needing to prove insurability. This is a great rider to add to life insurance for children.

Term Insurance Rider: Provides additional death benefit protection at a fraction of the cost of whole life.

Lafayette Life Insurance Company Review Conclusion

Lafayette Life continues to demonstrate financial strength and stability in 2025, with several key achievements:

• Record dividend allocation of $123.3 million
• Significant dividend interest rate increase to 5.75% (up 45 basis points)
• 120 consecutive years of paying dividends
• Maintains top financial ratings (A+ from A.M. Best, AA- from S&P, AA from Fitch)
• Continues to offer non-direct recognition policies, a significant advantage for policy loans

Lafayette Life is a solid choice when considering whole life insurance from a mutual company that practices non direct recognition. Although the company has some great policies available, a prudent shopper still needs to consider comparable options available in the marketplace.