Principal Life Insurance Company Review

Principal Life Insurance Company

The Principal Financial Group is the world’s leading financial service groups. 

Principal offers both insurance and financial products to businesses and consumers worldwide.  They have made a name for themselves by bringing affordable options and reliable policies to more than 18 million customers while providing services for consumers at a time that they need it most.  As both an insurance and financial company, you can have confidence in knowing that the Principal Financial Group, or The Principal, will handle your money responsibly.

Principal Life Insurance Company Background

Principal Life Insurance logo

Founded in 1879, Principal Life Insurance Company has been around the longest when compared to other life insurance companies.  Formerly known as Bankers Life Association, the company was started by Edward Temple and headquartered in Iowa.  After surviving the Great Depression, the insurance provider continued in their strive towards success.

With continued growth and operations in a dozen countries, the company became known as the Principal Financial Group in 1985.  In fact, the group was named one of America’s Best Employers, as well as one of the World’s Most Ethical Companies.  Currently, the Principal Financial Group retains over 14,000 employees worldwide.  With greater than $655 billion in total assets and $10.9 billion in GAAP revenues, the company remains one of the strongest contenders in the insurance industry.

Principal Life Insurance Company Ratings

The insurance and financial services conglomerate has been given an “A+” (superior) rating from A.M. Best, an “A1” (good) rating from Standard & Poor’s, and an “AA-” (very strong) rating from Fitch.  Additionally, The Principal has been accredited with the Better Business Bureau (BBB) since 1948 and has been given the grade of “A+”.

These high ratings indicate The Principal’s financial strength and ability to pay their policyholders claims well into the future.


life insurance policy genius


Principal Life Insurance Company Products

The Principal provides a wide array of life insurance products for both businesses and consumers.  Once you determine how much life insurance you need to buy, you will need to decide on what product you will purchase.  Some of the products include term life insurance, universal life insurance, indexed universal life insurance, variable universal life insurance, and survivorship life insurance.

Term Life Insurance

The Principal is regarded as one of the more affordable providers of term life insurance.  This is a simple, short-term policy available for most consumers.  The policy offers a death benefit only and includes 10, 15, 20, and 30-year term policies.  The premiums will rise annually beginning the first year following the ending of the policy’s term.  In many cases, the policy is renewable and convertible, without the need for a medical exam to prove continued insurability.

As with any life insurance policy, the better your health is the lower your rates should be.  Underwriting takes in to account your current health situation, tobacco use, family history and your credit report.  All of these factors will be studied by underwriting to determine your life insurance rate class.

Those requiring up to $1 million in coverage can have their eligibility rapidly determined using The Principal’s innovative underwriting process, known as TeleApp.  During the TeleApp process, you may qualify for up to $1,000,000 in life  insurance with no medical exam.  If an applicant is turned down for the company’s accelerated product, they are given the option to undergo a medical exam to get coverage.

Universal Life Insurance

Universal life insurance is a form of permanent coverage that offers both a death benefit and a cash value feature.  Under specified policy guidelines, the policyholder is able to designate what amount of their premium will go towards the actual insurance protection portion of the policy and the cash value portion of the life insurance policy.

The funds in the cash value component are able to grow and compound over time.  The accumulation of funds within the cash value can then be used to pay for the actual cost of insurance, policy riders, or any other expenses associated with the policy.

Indexed Universal Life Insurance

With many of the same benefits as the universal life insurance policy, such as a permanent death benefit and cash value feature, this plan enhances the manner in which interest is credited to the cash value portion.  Policyholders are able to choose whether their premiums go to a fixed account, an index-linked account, or even to both.

The indexed universal life policy has upside potential through the index-linked option, while having downside protection on the principal.  The growth on the cash value is tax-deferred, and no tax will be due until the policyholder withdraws the funds.

Variable Universal Life Insurance

This policy offered by The Principal combines the flexibility of the universal life insurance policy with the growth potential that’s supplied by market-related investments.  The focus for these policies are on the accumulation of the cash value.  Additionally, variable universal life provides more flexible death benefit options.

Survivorship Life Insurance

This policy, known as Survivorship Universal Life Protector II, covers two insureds under one singular policy.  With this policy, the death benefit is held until the death of the second named insured, at which time the benefit will be paid out accordingly.  These types of policies are great for estate planning purposes since they work alongside the unlimited marital deduction.  The estate would then be taxed after the death of the second named insured, or spouse.

The policy assists with contributing to the liquidity needed to pay estate taxes, keeping the insured’s’ business viable, leaving wealth for the upcoming generation, or for gifting a legacy to a loved one or charity.

The death benefit for this policy starts at $250,000, and the policy’s premiums are quite affordable.  There is also a lapse in protection provision and multiple choices for death benefits.

Furthermore, Principal can help place your existing 401(k), 403(b), or any other IRAs or retirement accounts.  The company also offers disability insurance, mutual funds, Irrevocable Life Insurance Trusts (ILITs), Group Insurance Benefits, Employee Retirement Plans, and much more.

Final Thoughts

The Principal Group is competitive in several markets as well, not just exclusively to life insurance.  Their frugal ways of conducting business in which The Principal was founded on benefits its members, and is the strategy still utilized today.

Furthermore, Principal Life Insurance Company’s marketing strategy and central focus targets small businesses, individuals, and families both across our nation and worldwide.  In the life insurance industry, the Principal offers highly competitive rates, a great selection of life insurance products, and innovation, all working together to meet the goals of the consumer’s life insurance needs.  Be sure to contact your life insurance professional to see if the Principal Life Insurance Company can meet your needs as well.

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