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Life insurance coverage is an essential aspect of a sound financial plan for most individuals and families. Having the right coverage in place offers peace of mind to the insured, as the life insurance company promises to pay a set amount to beneficiaries in the event of his or her death.
Life insurance companies offer many options, including term insurance and permanent insurance. With term insurance coverage, individuals have life insurance for a specific period of time, and then the policy expires. This can be helpful for keeping the cost of coverage low while also providing protection for decreasing financial needs, such as a mortgage balance.
Permanent insurance coverage is the opposite, lasting for as long as the premiums are paid per the policy agreement. Permanent life insurance also accrues cash value in some cases, which can be used as additional savings in the future.
Regardless of the type of insurance coverage selected, it is important for individuals to understand the cost and benefit of a specific life insurance policy as well as the strengths or drawbacks of the company providing the coverage.
Read on to learn more about AARP Life Insurance’s coverage, costs, benefits, and downsides.
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AARP is a national non-profit organization focused on helping people over the age of 50 understand their financial lives.
The company, founded in 1958, does not directly offer insurance to individual consumers, but instead partners with a national insurer to provide life insurance benefits to members of the organization. Currently, AARP offers life insurance coverage through New York Life. As a member of AARP, individuals have access to both term and permanent life insurance.
In addition to the life insurance partnership, AARP offers several educational resources and services to its members. AARP provides a comprehensive library of information relating to health and wellness in older age, family caregiving, retirement and work, travel and entertainment, and politics. The organization also offers discount programs through its membership arm, including savings on auto services, restaurants, shopping, and travel.
AARP Life Insurance Overview
The AARP Life Insurance partnership through New York Life offers two main options for life insurance coverage, with costs dependent on age, amount of coverage, state of residence, and the type of policy selected.
For term life insurance coverage, a woman age 60 to 64 has a monthly premium of $58 for $50,000 of coverage. The same age band for a man for the same amount of coverage is $94 per month.
The cost for this type of policy increases every five years, with men age 65 to 69 paying $128 per month, and men age 70 to 74 paying $184 per month. Women age 65 to 69 pay $81 per month and those age 70 to 74 pay $141 per month.
Guaranteed whole life insurance offered through New York Life to AARP members comes at a different cost. Women aged 60 pay $128 per month for $25,000 in permanent coverage, while men of the same age pay $148 per month for the same amount of coverage.
The premium costs for both term life insurance and guaranteed acceptance whole life insurance are slightly higher than insurance policies offered by similar providers.
Coverage & Most Popular Policy
AARP Life Insurance coverage options come in three categories: term life insurance, guaranteed acceptance whole life insurance, and traditional whole life insurance.
The guaranteed acceptance policy is the most popular for AARP members as it offers permanent coverage, without a medical exam, up to $25,000. Applicants must be between the ages of 50 and 80 to qualify for this type of coverage, but it is guaranteed to remain in place so long as the premiums are paid.
Term life insurance is also available without medical underwriting, with coverage between $10,000 and $100,000. Individuals must be between the ages of 50 and 74 to qualify for the term life insurance policy. Coverage can extend up to age 80 so long as the initial application was submitted by age 74. The cost for this type of policy increases every five years.
Whole life insurance is also available through New York Life to AARP members. This coverage offers up to $50,000 of permanent coverage with cash value accumulation, and individuals between the ages of 50 and 80 may qualify.
Requirements to Get Insured
While there are no medical exams required for any of the three policy options offered to AARP members, there are health questions that must be answered. Any major medical issues, such as cancer or heart disease, may disqualify an individual from getting coverage through a term or traditional whole life policy. The guaranteed acceptance whole life policy does not require these health questions to be answered.
In addition to potential health questions, individuals only qualify for the AARP Life Insurance program through New York Life if they are current AARP members. Membership to AARP requires a one, three, or five-year commitment, and the cost can be as low as $12 for the first year.
Also, applicants must meet age requirements to qualify for the simplified underwriting insurance programs offered through AARP and New York Life.
AARP Life Insurance is available in all 50 states. Aside from the age requirements, there are no restrictions as to who can apply and who may be eligible for coverage.
AARP is a well-known company that has an A+ rating with the Better Business Bureau. New York Life also has an A+ rating with the BBB, and the partnership program has high ratings from A.M. Best, Fitch, and Standard & Poors.
Customer service with AARP is available from 7 a.m. to 11 p.m. (EST) Monday through Friday, while New York Life customer service is available from 8 a.m. to 8 p.m. (EST) Monday through Friday, and 9 a.m. to 5 p.m. on Saturdays. These extended hours make it easy for AARP members to get in touch regarding coverage, payments, or other policy questions and concerns.
AARP is a strong member-focused non-profit organization, and its partnership with New York Life offers an affordable, simple way to get term or permanent life insurance coverage for AARP members. The initial cost of premiums for life insurance coverage may be slightly higher than comparable insurance providers, but this is partly due to the fact that no medical underwriting is required. Individuals should first be members of AARP before inquiring about coverage through the partnership program with New York Life.
Author: Melissa Horton