Certainly, when considering life insurance for you and your family, premiums will play a major role in your purchase decision. However, price alone should not be the only factor that impacts your buying decision.
Most U.S insurers receive positive ratings from insurance watchdogs but it’s still important that you are careful about who you choose to keep their promise for a lifetime. In this article, we will provide a company overview for USAA Life Insurance so that you can make an informed decision about where you put your life insurance business.
USAA Life Insurance Company
First, consumers should know that USAA provides many more insurance products than just life insurance. The USAA brand is an acronym for United Services Automobile Association which is the parent organization for many subsidiary companies that provide life, health, P&C, and other financial products.
USAA was founded by military officers back in 1922 because, at that time, military personnel were considered “high risk” and faced challenges when attempting to purchase almost any type of insurance product. Since its founding in 1922, USAA has significantly increased its footprint across the U.S. and today is a member of the Fortune 500 group of companies.
The insurance company is now servicing over 11 million members and ranks number 24 for in-force life insurance policies. Their ranking and company size is even more remarkable when you consider that they only market to military personnel and their families.
USAA Life Insurance Company Financial Stability
Although ranked 24th for life insurance volume, USAA is ranked at the very top by the major insurance rating services in the U.S. These ratings should set anyone’s mind at ease when they contemplate whether USAA will be able to pay a claim when the worst thing happens.
|Rating Service||Current Rating|
|Standard & Poor’s||AA+|
|Comdex||99 out of 100|
To top off their financial stability scoring, it’s important to note that USAA was voted Best of the Best for Top Veteran Friendly Company by U.S. Veterans Magazine in 2012 and 2014. Suffice it to say, companies do not receive these kinds of accolades unless they are delivering superior products with exceptional customer service.
USAA Life Insurance Products
USAA Life offers a complete portfolio of life insurance products that allows members of most ages to select the best insurance solution according to their needs. Since different life insurance products address different financial needs, most families have multiple types of life insurance in their household.
USAA Universal Life Insurance
Universal Life insurance was designed to address almost every financial need and provide permanent life insurance coverage with a savings component that accumulates cash value over time. Unlike other life insurance products that are “fixed” from their date of issue, universal life insurance is flexible and can accommodate life events that may require a change in premium payments and coverage.
Many universal life policyholders use their policies for accumulating cash that they can access at any time using policy loans or partial surrenders. The advantage of the cash value component means that even though the policyholder has insurance coverage for a lifetime, they can also access the cash value account in the policy to respond to financial needs of the insured. Policy loans can be taken for any reason and without credit checks, and the insured can elect to repay a loan or not repay it.
USAA Whole Life Insurance
Although priced higher than term insurance or universal life, whole life insurance is still a serious consideration for consumers looking for lifetime coverage that provides traditional guarantees and benefits. For seniors who are looking to purchase life insurance for final expenses, whole life insurance is the typical solution because of the guarantees it provides to the policyholder.
Whole life insurance is permanent and cannot be canceled by the insurer for any reason other than non-payment. The monthly premiums that are established when the policy is issued cannot be increased by the insurer for any reason and the policy builds cash value over time that can be accessed via policy loans, withdrawals, or surrender for the cash value.
Whole life insurance is also the preferred insurance type for the infinite banking concept that has become very popular with individuals and business owners. The infinite banking concept provides a funding source for major purchases and allows the policyholder to capture the interest normally paid to a lender.
USAA Term Life Insurance
The term life insurance product offered by USAA has options that other insurers do not offer. An applicant can choose between traditional term life coverage or a term life product that was designed specifically for military personnel.
USAA’s traditional term insurance is offered with policy periods of 10, 15, 20, 25, and 30 years where the premium remains level during the term you selected. The term insurance is inexpensive and a great solution for replacing income and financially providing for your surviving loved ones.
The term coverage for military personnel comes with additional benefits that most other insurers do not offer.
- Accelerated review for the family before an applicant is deployed
- War coverage exclusion is removed from the policy
- Severe injury benefit up to $25,000
- Coverage can be increased when transferring to civilian life without proof of insurability.
- USAA can combine term with permanent insurance for a lifetime coverage policy
Other Insurance Products from USAA
As we mentioned earlier, members can purchase multiple lines of insurance products and typically receive discounts for bundling the various policies they need. Here is a shortened list of other insurance products that individuals and families would require:
- Auto insurance
- Homeowners’ insurance
- Renters’ insurance
- Flood insurance
- Critical and Chronic Illness
- Motorcycle and boat insurance
- RV insurance
- Medicare supplement insurance
- Medicare Part D prescription drug coverage
- Dental and Vision coverage
Who is Eligible to Purchase Insurance from USAA
According to the USAA website, the following are eligible to purchase insurance products and become a member of USAA.
- Personnel who are active, retired, and honorably separated officers or enlisted men or women
- Office candidates in a commissioning program like the Academy, ROTC, or OCS/OTS
- Adult children whose parents have or had a USAA auto or property policy
- Widows and widowers of USAA members who have or did have a USAA auto or property policy