We all know we will eventually pass away, but thinking or planning for it can be very uncomfortable. Still, buying a life insurance policy provides protection for your loved ones or business partners when you pass.
Though you’ve probably heard of the AARP, you may not be aware that AARP offers several life insurance products exclusively to its members.
How does an AARP policy stack up to the other life insurance companies available on the market? This complete review of AARP life insurance will cover everything you need to know.
In this review:
AARP Life Insurance Products
The AARP Life Insurance Program from New York Life Insurance Company offers AARP members both term and permanent life insurance coverage.
| Policy Type | Coverage Amount | Premiums | Waiting Period | Medical Exam |
|---|---|---|---|---|
| Whole | $5,000 – $50,000 | Fixed | None | No |
| Term | $10,000 – $100,000 | Increase every 5 years | None | No |
| Guaranteed Acceptance | $2,500 – $25,000 | Fixed | 2 Years | No |
| Young Start | $10,000 – $20,000 | Variable | 2 Years | No |
AARP Whole Life Insurance
A permanent life insurance policy, also known as whole life insurance, is in effect for your entire life. As long as you make your monthly premium payments, your whole life policy coverage or death benefit will remain in effect no matter what health conditions you may acquire.
This type of policy is generally more expensive than term because it locks whatever amount of coverage you choose in for life.
It also provides a cash value you could borrow against. The difference borrowed would be deducted from the total payout once the policy is claimed.
You can obtain an affordable face amount up to $50,000 with no waiting period or exam. Your rates are guaranteed and will never increase.
AARP Term Life Insurance
In most cases of “Level Benefit” insurance with other companies, the rates do not increase throughout the entire policy term length.
With AARP, however, the rates go up every five years, and even then they are not guaranteed.
And while it can be considered a pro that no physical exam is required, applicants only have to answer three health questions.
This lack of thoroughness means that even if you are in good health, you may not get the lowest or most competitive term life insurance rates.
Coverage also only lasts up to age 80, so seniors who are older are out of luck.
AARP Guaranteed Acceptance Life Insurance
This life insurance option is also known as a final expense or burial insurance policy.
You can obtain coverage from $2,500 up to $25,000 with no medical exam required, making the underwriting process a little less stressful, especially if you’re not in great health.
According to their site, you just have to answer one health question, though you will have a two year waiting period.
AARP Young Start Life Insurance
The Young Start life insurance plan offered is an AARP permanent life insurance policy that you can purchase on your grandchild 18 years old or younger.
You can get the following benefit amounts for your grandchild:
- $10,000 for $5.00/month
- $15,000 for $7.50/month
- $20,000 for $10.00/month
Rider Options
Riders are additions you can tack on to your AARP whole life policies:
- Waiver of Premiums: wave 180 days of your premiums should you become ill, disabled, or need to live in a nursing home.
- Accelerated Death Rider or Terminal Illness Rider: covers you should you suddenly be diagnosed with a terminal illness and given 12 or fewer months to live, you can access 50% of your policy to help pay for expenses.
AARP Life Insurance Rates
Compared to other top life insurance providers, AARP just isn’t very competitive as far as rates go.
Of course, the choice of what life insurance company you choose is ultimately yours, but you will likely end up paying more than you should with AARP.
| Policy | Monthly Premiums |
|---|---|
| Term | $11 – $350 |
| Whole | $15 – $525 |
| Guaranteed Acceptance | $11 – $250 |
Tips for Cheaper Life Insurance Rates
Because we want to provide you with all the information you need to get a cheap plan, we want to provide you with some of the most common tips we give to our clients to secure the cheapest coverage.
Here is the advice we give to most of our applicants.
Compare Providers
You need to compare dozens of quotes. For most applicants, AARP isn’t going to be the most affordable policy, which means that it’s important that you find a company that will give you cheaper rates.
If you’re an older applicant that’s looking for insurance protection, there are some companies that are going to give you much more affordable rates.
You need to make sure when seeking the best insurance coverage to check out all of our available company reviews.
Don’t Commit to a Captive Agent
Unless you want to go through the time-consuming process of getting quotes alone, the best way to gather the quotes is to join an independent agency.
If you contact a typical insurance agent, they can give you one quote from their company.
With us, we can offer you more than 30 quotes all at once.
Improve Your Health
The last tip we offer to our clients is to improve their health by quitting some bad habits.
If you’re a smoker, we highly suggest quitting for at least one year before you apply for coverage.
If you’re an older applicant who smokes, be prepared to pay a lot more for your plan.
Calculate How Much Coverage You Actually Need
Don’t buy life insurance without adding up your needs.
To start, begin by seeing how much your family would have to pay off.
Calculate all of your unpaid bills. Your life insurance needs to be sizable enough to pay off your debts.
Once you have this number, you have your starting point.
The next number you need to put in your life insurance equation is your paycheck.
More specifically, several years’ worth of paychecks. Your policy is designed to replace your salary.
Every year our clients tell us stories about loved ones passing away and being left with debts.
Don’t let you or your family become another one of these stories.
AARP Life Insurance Company Ratings
When you’re reviewing a life insurance company, it’s a good idea to check out the company’s financial strength.
Here’s what we found on AARP’s New York Life Insurance Company:
- BBB: A+ rating though it is not accredited with the BBB
- A.M. Best: A++
- Fitch Ratings: AAA
- Standard and Poor: A++
- Moody: Aaa
- J.D. Power: 8th out of 24th
They scored outstanding marks on all fronts, making them a financially sound company to choose from compared to the best life insurance companies in the market.
