With so many variants and carriers in the space, shopping for a life insurance policy can get confusing. Each site you visit, you’ll be marketed to with the same thing, “our carrier is better”. Y0u can quickly become overwhelmed, so look to independent agents like us for advise. We have reviewed dozens of insurance companies to help you find the best one to suit your needs.
One company that we get a lot of questions about is AARP. They have one of the most popular organizations for life insurance for seniors, but that doesn’t mean that it’s automatically going to be the best plan possible. Before you purchase a life insurance plan through AARP (or if you already have one), it’s important that you look at the advantages and disadvantages of AARP and the other options available.
This AARP life insurance review will show you why AARP’s life insurance options aren’t a good choice if you’re looking for the best life insurance rates from some of the best life insurance companies.
With such a big name and a big presence in the media, you would think that AARP’s life insurance products would be competitive – unfortunately they’re not.
AARP is portrayed in the media as an advocacy group for seniors. They may lobby for senior rights, but unfortunately they’re using their “protector of senior rights” reputation to add legitimacy to their life insurance offerings with New York Life.
What most consumers don’t know about their life insurance offerings is that New York Life pays AARP to be their exclusive life insurance provider and unfortunately they are far from the best product for seniors.
People have the notion that any product offered by AARP has passed some type of integrity or value test. This is simply not the case.
Before we discuss AARP’s life insurance offerings, it’s important for you to understand where AARP came from.
AARP Life Insurance History
According to AARP’s wikipedia page:
AARP was formed by Leonard Davis (a retired principal who became an insurance agent) who promoted AARP’s image as a non-profit advocate to retirees in order to sell insurance policies to seniors. AARP earns more income from selling insurance to members than it does from membership dues.
Currently, AARP takes bids from insurance companies on who they will endorse. Colonial Penn was the first company to get the endorsement, but when Andy Rooney exposed that AARP was not much more than a front for an insurance company in 1978 on “60 Minutes”, that relationship was terminated and Prudential Life Insurance took over.
Currently, New York Life has the AARP contract through 2011 and they’re still the current life insurance provider.
As you can tell, there’s no value test or protection for seniors on the life insurance products AARP recommends. Whoever pays the most, gets the endorsement.
It’s unfortunate because seniors believe AARP is a group that looks out for their interests. Seniors are led to believe that buying an AARP product is the moral equivalent of buying insurance down at the local, non-profit senior citizen center.
AARP Term Life Insurance Product Review
First of all, we encourage you to get a quote from AARP, then compare that quote to the quotes listed on our instant life insurance quotes page. You can compare life insurance rates without giving any personal information. We’ll typically beat AARP term life insurance rates by a huge margin.
With that out of the way, AARP has 2 term life insurance products:
AARP Term Life Product #1: “AARP Level Benefit Term Life Insurance”
The Good: No medical exam and acceptance based on 3 questions.
The Bad: Expensive, maximum coverage of $50,000 and your premiums are not guaranteed level.
What’s misleading about how AARP markets this life insurance product is they call it “level benefit” term life insurance. This is deceiving because it leads seniors (and myself) to think their monthly premiums remain level – when in fact it’s your death benefit that remains level and not your premium payments.
With this product, your monthly premium payments will go up every 5 years. So don’t get fooled by their marketing of this product.
AARP Level Benefit Term Life Insurance quotes will always be more expensive. You can find AARP’s Level Benefit Term Life insurance rates on their website.
Now, run a quote for a REAL level premium term life policy (no contact information required). Make sure you choose the term length that gets you to age 80. AARP Term Life Insurance expires at age 80 so I want to make sure you’re comparing similar policies. If you want to bypass the medical exam, look at rates from Transamerica and Assurity.
You’ll find that your premium payments will be less expensive AND guaranteed not to go up. Your premium will go up every 5 years with AARP.
I hope we’ve convinced you that you can save money by having a life insurance comparison service like our agency shop the market for you.
AARP Term LifeProduct #2: “AARP Extra Protection Term Life Insurance”
This life insurance policy is the exact same as the product listed above, except it goes up to $100,000 of coverage and there’s a few more qualifying questions.
Just like the “AARP Level Benefit Term Life Insurance” listed above, this product is also more expensive.
You can view the AARP Extra Protection Term Life Insurance rates here.
Again, compare the rates above from AARP to a REAL level premium term life policy using our quote form (no contact information required). Make sure you choose the term length that gets you to age 80. AARP Term Life Insurance expires at age 80 so I want to make sure you’re comparing similar policies. If you want to bypass the medical exam, look at rates from Transamerica and Assurity.
AARP Guaranteed Acceptance Life Insurance Review
The AARP Guaranteed Acceptance Life Insurance policy is a whole life insurance policy that doesn’t ask any health questions.
In order for them to do this, they use a “graded death benefit” product which limits the death benefit within the first two years.
Again, there are other guaranteed acceptance life insurance products on the market that will be cheaper than AARP Guaranteed Acceptance Life Insurance.
Specifically – Mutual of Omaha and AAA.
We have guaranteed acceptance companies to offer you as well, but Mutual of Omaha and AAA have considerably lower premiums and unfortunately we can’t offer you these policies because they’re not available to independent agencies like ourselves. You have to buy them direct.
We provide their contact information on this guaranteed acceptance life insurance article. Make sure you give them a call before moving forward with AARP.
It’s important for anyone purchasing life insurance to understand that life insurance companies look at each individual risk differently, yet surprisingly your illness could be viewed better with some carriers. The goal is to find that ONE company that fits your needs best.
It’s always in your best interest to compare life insurance rates and not rely on an organization that only offers 1 option.
Although it may seem like AARP would be giving it’s members a “deal” on life insurance, it couldn’t be further from the truth as we’ve proved above.
We work with over 60 “A” rated companies and most of them can blow AARP/New York Life’s rates out of the water, with level payments and last indefinitely (if structured right).
Do you really want an advocate that looks out for you when purchasing life insurance? Speak with an experienced independent life insurance agent.
Unlike traditional insurance agents, our advisors are able and willing to work with many companies which broadens our portfolio of plans offered. This benefits our clients greatly since we can tailor a policy to reach your goal.
Compare what we can offer you to what AARP life insurance can.
We replace AARP policies all the time. Even if you’ve already purchased a policy, we can secure you a less expensive policy and you can cancel your AARP policy with no penalties.
A lot of our clients assume that they will have to pay some sort of cancelation fee or termination fee to switch life insurance, but that isn’t true. It’s quick and easy to switch life insurance plans and we can help you do that. Our agents can walk you through the process and deliver dozens of personalized quotes directly to you.
Get a jump on the process by completing the quote tool on this page, or reaching out in the comments or on the phone!
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