Of course insurance companies take in more premiums than they pay out in death benefit. How else would they survive as a company if their expenses were greater than their revenues? They have to take those premiums and put them to work in relatively safe investments in order to be able to pay out the death benefit when the time comes. This is true for whole life, which will always be paid so long as the policyholder doesn't let the policy lapse. Term insurance doesn't pay out something like 97% of the time because the policy usually expires before the insured dies, so unless you are buying long-dated convertible term, it's generally not really worth it. Grandchildren whole life policies are great once you have purchased a substantial amount of whole life on yourself, your spouse, and your own kids. They obviously won't have a large death benefit but the amount of death benefit you get per dollar of premium is huge, because children are at the lowest risk of dying. So you can start building capital for a child very early in their life and then gift them the policy when they come of age so that they will have an asset that they can use to finance the purchase of a car or school tuition or down payment on a house or whatever else. And obviously stock life insurance companies are inferior to mutual life companies and stock companies should be avoided completely.