Is Life Insurance Company of the Southwest a Good Insurer?
Short Answer: Yes—Life Insurance Company of the Southwest (LSW), founded in 1955 and backed by National Life Group (founded in 1848), is financially strong and stable. However, high ratings alone do not mean every product is the best fit. You must still compare product costs, design, and features to ensure long-term value.
Financial Ratings & Company Strength
A Comdex score of 90 places LSW among the top-tier insurers in terms of overall financial strength.
What Makes LSW Stand Out
- Backed by nearly 170+ years of institutional history through National Life Group
- Strong ratings from all major agencies
- A wide selection of life insurance and annuity products
- Long-standing reputation for conservative, reliable financial management
- Well-suited for long-term policies requiring stability
Why Company Stability Matters
Life insurance and annuities are long-term financial commitments that often last decades. You want a company capable of fulfilling contractual guarantees for the life of the policy.
- Short-term contracts (<5 years): Slightly weaker carriers may be acceptable.
- Long-term contracts (5+ years): Choose carriers rated A- or better with 50+ years of operating history.
LSW meets and exceeds these standards with its 1955 founding year and strong financial ratings.
Why High Ratings Don’t Automatically Mean Great Products
Even highly rated companies can offer products that:
- They are more expensive than their competitors
- Have slower cash value accumulation
- Provide less competitive annuity income guarantees
- Include riders that add cost without meaningful value
- Use product structures that favor the insurer more than the consumer
Company strength protects the promise, but product design determines your outcome.
What LSW Sells
Life Insurance
- Term Life Insurance
- Universal Life Insurance
- Indexed Universal Life (IUL)
- Whole Life (varies by state)
Annuities
- Fixed Annuities
- Fixed Indexed Annuities
- Income Annuities
- Deferred Annuities
Our Professional Opinion
National Life and LSW are great insurance companies, with some annuities we like for fixed growth and guaranteed lifetime income. Their products vary considerably, though, and some bonuses and long surrender periods come with more strings attached than we would like.
National Life Insurance Company and its subsidiary, Life Insurance Company of the Southwest, each have an A+ (Superior) rating from AM Best. That comfortably exceeds our A− minimum.
For deferred income, we prefer the options with a contractual roll-up over those that depend heavily on future index credits. Compare the actual guaranteed paycheck—a large income-base bonus is not cash you can withdraw.
For accumulation, we generally favor the shorter, straightforward contracts. A premium bonus can be useful, but some bonuses can be recaptured even when a withdrawal avoids the normal surrender charge.
What We Like
- Great financial strength: Both insurers have A+ AM Best ratings.
- Guaranteed income choices: Some riders offer contractual growth while income is deferred.
- Fixed annuity flexibility: One reviewed MYGA offers MVA and non-MVA versions without an automatic new multiyear lockup at maturity.
- Contribution options: Some contracts accept ongoing deposits.
What We Don’t Like
- Long commitments: Some products have surrender periods of ten years or more.
- Changing crediting terms: Caps and participation rates may fall at renewal.
- Bonus restrictions: Some bonuses are delayed or subject to recapture.
- Limited first-year access: Several contracts do not offer ordinary free withdrawals until after the first year.
Explore our individual LSW and National Life annuity reviews using the links below to see which products we like and what to watch for.
Our LSW and National Life Annuity Reviews
- National Life Annuity Income Products
- National Life FIT Series Annuities
- National Life Growth Products
- National Life SecurePlus Annuity Series
- RetireMax Secure Annuity
Additional Riders and Features
- Accelerated death benefits
- Chronic illness riders
- Disability waivers
- Long-term care–related riders
- Guaranteed lifetime income benefits
Pros and Cons
Pros
- Strong financial ratings and Comdex 90
- Founded in 1955 with deep historical stability
- Backed by a parent company founded in 1848
- Offers a broad mix of life and annuity solutions
- Well-suited for long-term protection and retirement planning
Cons
- Not always the lowest cost option
- Some IUL designs may be less competitive
- Rider costs vary significantly
- Product competitiveness varies by age, goals, and state
Who Needs LSW and Why
- Families needing long-term life insurance
- People seeking permanent life insurance backed by a strong insurer
- Retirees want a stable, reliable annuity income
- Professionals and business owners with long-term obligations
- Buyers focused on insurer stability over ultra-low premiums
Who Doesn’t Need LSW
- Shoppers seeking the absolute cheapest term life insurance
- Buyers wanting highly aggressive IUL accumulation performance
- People who prefer instant online policies from digital-only carriers
- Individuals with short-term coverage needs
Additional Insurance to Consider
- Disability Insurance
- Long-Term Care Insurance
- Annuities with GLWBs for lifetime income
- Accident or supplemental health coverage
- Life insurance riders to enhance flexibility
People Who Benefit Most
- Long-term planners
- Families wanting permanent protection
- Retirees using annuities for income
- Business owners needing stable contracts
- Buyers who prioritize financial strength
How To Evaluate Any Life Insurance or Annuity Company
- Choose A- or better carriers for long-term commitments
- Prefer companies with 50+ years of history
- Review product design, costs, and surrender terms
- Evaluate riders and policy flexibility
- Compare at least three A-rated carriers
- Work with an independent broker
LSW meets the company-strength criteria. Your final decision should focus on product competitiveness.
How LSW Compares to Other Strong Carriers
- Strengths: High ratings, long history, Comdex 90, broad product lineup
- Competitors may excel in: Lower premiums, stronger IUL crediting, and more flexible annuity riders
Comparison ensures maximum value.
How To Save Money When Buying Coverage
- Compare multiple A-rated carriers
- Use term life for temporary needs
- Blend term and permanent when appropriate
- Avoid unnecessary riders
- Optimize underwriting
- Use an independent broker
What If You Already Own an LSW Policy?
- Keep it if it fits your budget and goals
- Review if your family or financial situation changes
- Avoid replacing unless the benefits clearly outweigh the costs
- Have The Annuity Expert review your policy
Underwriting Expectations
- A medical exam may be required
- Health class affects the premium
- Financial underwriting applies to large policies
- Approval time varies
How To Know If LSW Is Right For You
You may be a strong fit if:
- You want long-term coverage backed by a financially strong company
- You value LSW’s founding year and long history
- You need permanent life or annuity solutions
- You prefer stable, predictable policy structures
Always Compare Before Buying
Before choosing any insurer:
- Compare policy terms
- Evaluate premiums and riders
- Understand cash value growth or income guarantees
- Confirm long-term suitability
A strong company is necessary, but the product must be competitive as well.
What To Do Next
Contact The Annuity Expert for free quotes to compare LSW with other A-rated insurers. We’ll help you evaluate pricing, value, and long-term fit so you choose the best possible coverage.
Book A Free Consultation
Get help from a licensed financial professional. This service is free of charge.
Let Us Answer Your Questions
Not quite ready for a meeting, but you have a question that needs answering? We’re happy to help. Leave an inquiry below, and one of our staff will respond via email.
Questions From Our Readers
- When was LSW founded? LSW was founded in 1955, and its parent company, National Life Group, was founded in 1848.
- Is LSW financially strong? Yes—LSW holds A+, A+, and A1 ratings with a Comdex score of 90.
- Does a strong rating mean the products are always great? No. Product design varies and must be evaluated independently.
- Does LSW offer both life insurance and annuities? Yes. They offer term, universal life, IUL, fixed annuities, and indexed annuities.
- Should I compare LSW with other companies before buying? Yes. Comparison ensures better pricing, features, and long-term value.