AARP Life Insurance Review 2020

Thang Truong
Thang Truong
Updated on:

If you’re a member of the AARP, or the American Association of Retired Persons, you know that there are many benefits to membership. One of them is life insurance. AARP pairs with New York Life to offer group life insurance, both term and permanent coverage. 

The name AARP is somewhat misleading, as members do not need to be retired to join, they only need to be over age 50. If your spouse is over 50 and a member, you can join if you’re over 45. Membership in AARP is $16 a year, $12 a year if you sign up for automatic renewal. If you have difficulty getting life insurance, due to age or health problems or both, AARP might be a good option for you.

Pros and Cons of AARP Life Insurance

ProsCons
– Guaranteed acceptance. Learn more about guaranteed issue life insurance
– No medical exam for any policies. Learn more about No Medical Exam Life Insurance
– Offers both term and whole life policies
– Fewer complaints than most
– Simplified application process
– Term insurance is “level benefit” not level premium
– Maximum amount of coverage is $100,000
– Guaranteed acceptance means higher premiums

Products Offered by AARP Life Insurance

AARP offers some basic life insurance products:

  • Term life insurance
  • Whole life insurance
  • Guaranteed acceptance whole life
  • Child whole life 

Term life insurance offers up to $100,000 worth of coverage and you can apply if you’re between 50 and 74. An important thing to note is that this is “level benefit” insurance. This means the death benefit stays the same, but the premiums go up. They usually rise in five-year increments, every time you enter a new age group. Prices are not guaranteed, which makes it difficult to budget. There is no medical exam required, which makes this an attractive option for seniors who have medical issues.

Whole life insurance is available up to $50,000 worth of coverage and you may apply if you’re between 50 and 80. Like all whole life policies, it builds cash value over time. With this policy, your premiums stay at the same level through the life of the policy. Benefits won’t decrease and will continue for the rest of your life, although you stop paying premiums at the age of 95. There are two benefits riders you can attach:

  • Accelerated death benefit: If you are diagnosed with a terminal illness and have less than a year to live, you can access up to 50% of the death benefit while you’re still alive. 
  • Waiver of premium: If you need to enter a nursing home, you can waive the premiums for as long as you stay, after 6 months have passed.

Guaranteed Acceptance Whole life insurance is available up to $25,000 in coverage and you can apply if you’re between 50 and 80. Should you happen to die within the first two years of the policy, your beneficiaries won’t get the full death benefit; they’ll get 125% of the premiums you paid.

Child whole life insurance allows parents and grandparents to buy up to $20,000 worth of life insurance for a child under the age of 18. Learn more about Life Insurance for Children

If you have health problems and can’t get life insurance any other way, AARP life insurance might be a good fit for you. Because they don’t have a medical exam, almost everyone is accepted. This makes premiums higher than they might be elsewhere. If you have a medical problem, it might still pay to shop around to see if you can find a policy with better rates. 

Financial Strength Rating of AARP Life Insurance

AARP’s life insurance is New York Life. They’ve been in business since 1845. A.M. Best gives them a financial strength rating of A++. You can’t rate higher than that. You want your insurance company to be financially stable enough to pay out claims, and there is no question that New York Life is able to do so.

>>MORE: New York Life Life Insurance Review

Customer Satisfaction Rating of AARP Life Insurance

Every year, J.D. Power rates life insurance companies on how well they meet customers’ expectations. They are rated on six criteria, and each company also gets an overall rating. 

Overall, New York Life earned a score of 770 out of a possible 1000 points, with the median average score being 761. 

Here is New York Life ranks on the six criteria:

  • Product Offerings: 4/5
  • Price: 4/5
  • Statements: 3/5
  • Interaction: 3/5
  • Communication: 3/5
  • Application and Orientation: 4/5

It’s important to note that not every product New York Life has is available to AARP members, so the product offering category is a little narrower for AARP.

Overall, New York Life seems to deliver what customers expect.

Consumer Complaints Rating of AARP Life Insurance

NAIC rates companies according to a ratio. The national median complaint ratio is 1.0, meaning a company earns as exactly as many complaints as you would expect for a company of their size. A score of 2.0 would mean they got twice as many complaints. 

For Group life insurance, New York life earned a ratio of .32 and for individual life insurance they got a score of .15. This means fewer complaints than most companies of their size. 

Digital Experience Rating of AARP Life Insurance

To apply for term life insurance, getting an online quote is pretty easy: just put in your information and it gives you a quote. All of the questions are pretty standard, except you might need to give them your AARP membership number. 

To apply for permanent life insurance, you can also get a quote online, however, there is a line in the application that asks for your phone number. It tells you a representative will call you. It also says online quoting is not available in all states. 

There is no mobile app available. Online, you can make payments, set up automatic payments and manage your beneficiaries. 

Last Thoughts:

If you’re already an AARP member and you have health problems, you could consider a quote from AARP. If you are in good health, it will pay to shop around. Even if you have health problems, some companies are more forgiving than others, so it’s worth it to shop around.

Thang Truong
Thang Truong

Thang Truong covers small business insurance and small business success at BravoPolicy. He is a licensed P&C insurance agent. Previously, he held product leadership positions at realtor.com, Capital One, NerdWallet, and Mulberry Technology. He holds a MBA degree from UC Berkeley - Haas School of Business.

More Stories

6 Best Indexed Universal Life Insurance (IUL) for 2023

Are you looking for a way to set aside some extra money for your senior years, and maybe a little extra for loved ones to inherit? Most people opt for indexed universal life insurance because it offers the greatest cash value growth tied to the performance of S&P 500 index with the least risk thanks […]

Thang Truong
Thang Truong

Best Self-Directed Roth IRA Companies for 2023

A self-directed Roth IRA is much like a regular Roth IRA, but offers more flexibility as far as what you can invest in. Whereas a regular Roth will only let you invest in stocks, bonds, mutual funds, ETFs, and real-estate investment trusts, a self-directed Roth lets you invest in a greater variety of investment options.  […]

Thang Truong
Thang Truong

The 5 Best Hybrid Long-Term Care Insurance Companies for 2023

If you’ve decided to plan for every eventuality, you’d be smart to include a plan to cover long-term care. Someone turning 65 this year has an almost 70% chance of needing some type of long-term care, and about 13% of those will need it for five years or more. Long-term care is expensive and can […]

Thang Truong
Thang Truong

The 3 Best Traditional Long-Term Care Insurance Companies for 2023

Long term care is something that no one likes to think about, but unfortunately, many people will eventually need. Health care costs are skyrocketing, and a lengthy stay at a long-term care facility can easily bankrupt most people’s nest eggs. Long-term care insurance is one way to protect both yourself and your retirement savings. Out […]

Thang Truong
Thang Truong

The Best Long-Term Care Insurance Companies in California for 2023

California residents who are keen to protect themselves and their families against the worst events in life may be considering long-term care insurance. However, you might not know much about LTC insurance or how it is handled in California. Let’s take a look: What is Long-Term Care Insurance? Long-term care insurance helps pay for long-term […]

Thang Truong
Thang Truong

The Best Long-Term Care Insurance Companies in Arizona for 2023

Arizona is a great place to retire. It’s warm, there’s no snow to shovel, and Arizona improves the quality of life for anyone with allergies or asthma. When you pack your bags and retire to Arizona, you’re probably not thinking about long-term care. But the sad reality is that 47% of men and 58% of […]

Thang Truong
Thang Truong

The Best Long-Term Care Insurance Companies in Florida for 2023

There’s a lot of good reasons to retire in Florida. The weather is warm, the beaches are beautiful, and there are lots of other retirees to socialize with. Also, Florida has no state income taxes, no inheritance taxes, and no estate taxes. When you pack up your things and move to Florida, you’re probably not […]

Thang Truong
Thang Truong

Private Placement Life Insurance: Everything You Need to Know

If you haven’t heard of private placement life insurance, you probably don’t qualify to buy it. Private placement life insurance is typically for investors with millions in liquid cash that they need to invest for tax reasons.  What is Private Placement Life Insurance? Who Qualifies for Private Placement Life Insurance? Benefits of Private Placement Life […]

Thang Truong
Thang Truong

Nationwide IUL – A Strong Product With Great Features and Excellent Ratings

The Nationwide IUL product can help you either supplement your retirement income or ensure your beneficiaries future by leaving them a nice tax-free death benefit. Obviously, you have many options when it comes to IUL policies, so you want to know how does Nationwide’s policy stack up against the competition? Let’s take a look. Pros […]

Thang Truong
Thang Truong

Transamerica IUL – A Solid Product but High Consumer Complaint Score & Law Suits

Consumers looking to supplement their retirement income often settle on an indexed life insurance policy. These policies build cash value based on market performance and allow your heirs to enjoy a tax-free death benefit. Let’s take a look at Transamerica’s indexed universal life insurance policy and see what makes it stand apart from other such […]

Thang Truong
Thang Truong