Shefi Ben-Hutta
Editor at Coverager

Looking out for Life’s latest

The past few months delivered two signals about the U.S. life insurance market. In February, Legal & General agreed to sell its US protection business to Meiji Yasuda, which already operates Pacific Guardian Life. More recently, Ethos Technologies filed to go public. The comparison matters not because the models resemble each other, but because they compete for the same market.

  • Legal & General America (LGA) is valued at $2.3 billion based on the sale. Ethos last held a $2.7 billion valuation in 2021.
  • LGA’s 70-year-old protection business is expected to generate roughly $90 million in 2024 operating profit, up from $34 million in 2023.
  • Ethos reported $48.7 million in 2024 operating profit in its S-1.
  • LGA sold 169,730 policies in 2024 (in part, thanks to Ethos) — nearly all term life. Ethos sold 127,623 policies across term, whole life, and indexed universal life. Ethos is only ten years old, and in 2019 it had a single product; today it has ten.

Evaluating Ethos requires assumptions — including whether its 2021 valuation holds and whether its IPO lands. It also raises distribution questions: the company still relies heavily on three carriers for most of its revenue and three agencies for most of its third-party production.

  • “For the years ended December 31, 2023 and 2024, our top three carrier relationships, which are Ameritas, Legal & General America, and TruStage, represented approximately 98% and 98%, respectively, of our total revenue.”
  • “For our top three carriers by distribution, who are also our longest tenured carriers, we were their largest source of life distribution in 2024. However, we still have significant opportunities to increase our share, as we accounted for a minority of these top three carriers’ life insurance premiums in 2024.”
  • “For the year ended December 31, 2023, two insurance carrier customers accounted for 60% and 24% of total revenue. As of December 31, 2023, two insurance carrier customers accounted for 76% and 16% of total accounts and commissions receivable. For the year ended December 31, 2024, three insurance carrier customers accounted for 54%, 25% and 19% of total revenue. As of December 31, 2024, three insurance carrier customers accounted for 63%, 19% and 11% of total accounts and commissions receivable. For the six months ended June 30, 2024 (unaudited), three insurance carrier customers accounted for 57%, 21% and 19% of total revenue. As of June 30, 2024 (unaudited), two insurance carrier customers accounted for 15% and 78% of total accounts and commissions receivable. For the six months ended June 30, 2025 (unaudited), three insurance carrier customers accounted for 39%, 34% and 15% of total revenue. As of June 30, 2025 (unaudited), two insurance carrier customers accounted for 73% and 14% of total accounts and commissions receivable.”
  • “Our revenue from sales of policies on our platform through our third-party channel is driven by a limited number of agencies. In each of the years ended December 31, 2023 and 2024, approximately 17% and 25%, respectively, of our revenue was generated through three of our most significant agency relationships.”

Ethos’ S-1 points to Progressive’s auto success, but not Progressive Life. Progressive has essentially 0% life market share, and nothing indicates it will replicate its auto playbook in life — and if it ever did, that would be a competitive threat to Ethos, not evidence in its favor.

  • “According to LIMRA, approximately 90% of life insurance premiums are sold through agents. We believe DTC sales will continue to gain traction as consumers increasingly expect a digital end-to-end experience. The United States auto insurance sector has demonstrated this preference shift: Progressive wrote 56% of its personal auto premiums through DTC channels for the year ended December 31, 2024 according to company filings. Life insurance is undergoing a similar transformation, and we believe Ethos is positioned to lead and benefit from this transition with its modern, technology-first platform.”

LGA’s success rests on accessibility, affordability, and — less obviously — the collapse of the cash-burning D2C bets that dragged down MassMutual and Prudential, namely Haven Life and Assurance IQ. With those players gone, LGA is competing on accessibility and affordability alone, both of which can be easily replicated within today’s agency-driven market. After all, Ethos — LGA’s largest contributor — owes much of its momentum to agency incentives and rewards now that it’s far less D2C-heavy.

  • “The DTC channel generated revenue of $119 million and $174 million, accounting for 75% and 68% of our total revenue for the years ended December 31, 2023 and 2024, respectively. The third-party channel generated revenue of $41 million and $81 million, accounting for 25% and 32% of our total revenue for the years ended December 31, 2023 and 2024, respectively. The DTC channel generated revenue of $91 million and $112 million, accounting for 77% and 61% of our total revenue for the six months ended June 30, 2024 and 2025, respectively. The third-party channel generated revenue of $27 million and $72 million, accounting for 23% and 39% of our total revenue for the six months ended June 30, 2024 and 2025, respectively. For additional information on revenue, see Note 3 to our audited consolidated financial statements included elsewhere in this prospectus.”

And if you want to see what a purely D2C life insurance business looks like, just look at Lemonade — and then look away.

All of this and more in our report, Life Insurance: Finding Movers in a Market That Doesn’t Move.