AARP Life Insurance Review

AARP Life Insurance Review

A common question asked by most shopping for life insurance is whether AARP is a life insurance provider.

The short answer is no, AARP is not an actual life insurance provider.

AARP is, in regards to life insurance coverage, a marketing organization focused on selling its brand image to the highest bidding insurance provider.

Presently, New York Life provides the company’s life insurance for seniors, United Healthcare for health insurance, and The Hartford for automobile insurance.

The catch is that you have to be a member of AARP in order to qualify for their life insurance products.  However, AARP’s life insurance offerings cost substantially more than their competitors, not to mention you’ll have to pay a membership fee to even start the process.  In the off chance that you’re already an AARP member, this review will assist you in understanding the line of products that they currently offer.

AARP Free gift

Did you just get an AARP renewal or Commencement invitation? 

I just received a mailer from AARP asking me to join or renew.  They charge $16 per year to be a member but they entice you with a free gift to do so.  This time my free gift is a blue plaid insulated travel bag.   is very convincing

AARP Life Insurance History

Originally founded as the National Retired Teachers Association, AARP got its start back in 1947 when Dr. Ethel Percy Andrus wanted to help retired teachers purchase sufficient health insurance coverage.  To Dr. Andrus’ surprise, there were numerous requests for insurance assistance from individuals that were not retired teachers.  So, in 1958, Dr. Andrus set out to establish an organization that would help senior citizens with their insurance needs by forming the AARP (American Association of Retired Persons).

AARP Life Insurance Ratings

As mentioned, AARP’s life insurance is both underwritten and managed by New York Life Insurance Company.  The insurer has been given an “A++”, superior rating by A.M. Best, one of the leading insurance rating agencies.  This rating while denotes the provider’s financial strength.  However, there have been a compelling number of reviews criticizing the company’s handling of claims.

AARP Life Insurance Products for Seniors

AARP provides life insurance coverage to senior members via the New York Life Insurance Company.  No medical exam is required for AARP Senior Life Insurance, and anyone 50 or older can join AARP and then apply for life insurance coverage.  The products currently offered include Permanent Life Insurance, Guaranteed Acceptance Life Insurance, and Level Benefit Term Life Insurance.

AARP Permanent Whole Life Insurance

This policy provided by AARP affords fixed premiums through the life of the policy.  Specifically, your premiums will never increase – the amount you pay in the beginning will remain unchanged.  Coverage amounts range from $5,000 to $50,000, making this product more suitable to cover final expenses.

AARP Guaranteed Acceptance Life Insurance

This policy is AARP’s form of burial life insurance with guaranteed acceptance, and it has a 2-year graded death benefit.  This means that there will be no payout during the first two years of the policy, except in the event of accidental death.

If the policyholder passes from natural causes within the first two years of the policy, the premiums paid in will be returned by the insurance company.  However, in the event of an accident, the life insurance provider will pay the full coverage amount (death benefit) to the named beneficiaries.  AARP’s Guaranteed Acceptance Life Insurance has face amounts ranging from $2,500 up to $15,000 (increments of $2,500).

AARP Level Benefit Term Life Insurance

The unfortunate point about this policy is that the premiums increase every five years.  What is considered “level” with this policy is the death benefit itself.  Coverage can begin at the age of 45 and lasts until the age of 80, at which point the coverage will cease.  Coverage amounts range from $10,000 up to $50,000.

However, one of the biggest selling points of this policy is that a medical exam is not required for coverage.  Many senior citizens searching for adequate life insurance coverage have failing health or pre-existing medical conditions, which prevents them from receiving coverage once undergoing medical underwriting.  On the other hand, policies not requiring a medical exam prior to coverage approval tend to be quite costly.

AARP Extra Protection Term Life Insurance

Similar to AARP’s Level Benefit Term Life policy, this policy offers you more protection, with coverage amounts up to $100,000.  This is a great option for applicants needing coverage that exceeds what most basic plans have to offer.

AARP Whole Life Insurance for Children

Through the company’s Young Start Program, AARP members between the ages of 50 and 80, can purchase whole life insurance plans for their children or grandchildren (up to the age of 17).  As with AARP’s other policies, a medical exam is not required, however, eligibility is dependent on a few health questions.  Coverage is available up to $20,000.  Once the child reaches 21, he or she becomes the policy owner, and they can then choose their own beneficiary.

Advantages of AARP Life Insurance

AARP offers a simplified application process with no medical exams required.  Additionally, with their tier policies, premium rates are not going to be remarkably higher if you are a smoker.  Another advantage is that AARP does not perform a background check for criminal activity, as is the case with other life insurance providers.

In Conclusion…

While you may be able to get coverage rapidly with AARP and you won’t be penalized strongly for smoking, their policies are substantially higher in price than other policies on the market.  Even with the AARP member discount, their policies are still not the most economical choice.

Just as with any other major purchase in life, you don’t want to go with the first life insurance carrier that you get quotes from.  Do your research and compare other providers against the coverage being offered by AARP.

There’s no reason in paying exorbitant premium prices each month in order to get life insurance coverage, not with all of the numerous products offered by other leading life insurance providers.  You can get more affordable rates with another company that also has a long-standing history of insuring seniors over the age of 50.

As a retired individual, your life insurance needs are unique.  It’s important to enlist the assistance of a reputable independent life insurance agent or company like Ogletree Financial, that represents multiple carriers, so that you know you are getting the best coverage at a price that you can afford.

 

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