AARP Life Insurance might be a good choice if you’re looking for a small-term policy or a small whole-life policy and do not want to undergo a medical examination or a battery of health questions. Note that you’ll need an active AARP membership to apply. And if you want to customize your policy with riders or need more than a low amount of coverage, you’ll need to check elsewhere.
The AARP Life Insurance Program features a selection of policies issued by New York Life Insurance Company for the group’s members.
The AARP advocates for older people and has more than 37 million members. Anyone can join, but life insurance availability is limited to members 50 or older, plus eligible spouses.
AARP life insurance earned 4.5 stars out of 5 for overall performance.
AARP life Insurance Policies
1. Term life insurance
AARP members aged 50 to 74, as well as their spouses aged 45 to 74, are eligible to apply, and coverage is available until the insured’s 80th birthday. Although the death benefit remains constant during the term, the annual cost rises every time the covered person enters a new five-year age band. At or before the age of 80, a term life policy can be converted to permanent insurance.
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The rates for permanent coverage will be determined by age. The AARP term life insurance offers coverage amounts ranging from $10,000 to $150,000 (or $100,000 in New York), with higher amounts available by phoning New York Life. Applicants must answer a few health questions and give additional health information but are not required to take a life insurance medical exam.
2. Whole life insurance
AARP members aged 50 to 80, as well as their spouses aged 45 to 80, are eligible to apply. The annual cost is constant, and coverage lasts your entire life. However, you can stop paying premiums once the policy is declared paid up (usually at age 95). The online application provides up to $50,000 in coverage, but higher amounts may be available by phoning New York Life. Acceptance is dependent on responses to a few health-related questions.
5. Guaranteed acceptance Whole life insurance
AARP members aged 50 to 80, as well as their spouses aged 45 to 80, are eligible to apply. Members and their spouses aged 50 to 75 are eligible for coverage in New York. Acceptance is guaranteed, and there are no health-related inquiries required for approval.
However, if the insured dies of natural causes within the first two years of the policy, just a portion of the death benefit (110% of the premiums paid in most states) is paid out. For an accidental death, the full benefit is paid from the first day of coverage. The coverage is limited to $25,000, but larger coverage alternatives may be available by calling New York Life. Guaranteed acceptance whole life insurance is not available in every state.
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AARP Life Insurance Pros and Cons
Pros
- No-medical-exam term and whole life policies: AARP offers term and whole life insurance without a medical exam, which makes it easier to get approved for coverage if you have pre-existing conditions.
- Policies are underwritten by New York Life: All AARP life insurance policies are issued by New York Life, which receives an A++ (Superior) financial strength rating from AM Best. This is the agency’s highest rating; only nine of the 91 life insurance companies reviewed received a rating this high.
- Online application is available: You can apply for term and whole-life coverage directly online without contacting an agent. However, you will need to supply your personal information (name, address, and email) to get a quote.
Cons
- Few riders: If you want to personalize your life insurance policy, AARP might not be the best choice. AARP offers fewer riders than many of the top life insurance providers reviewed.
- Only available for AARP members: To purchase life insurance through AARP, you must have an active membership, which charges an annual fee. And because the minimum age to join AARP is 50, younger people are not eligible for the coverage.
- Low coverage limits: AARP life insurance policies have low coverage limits—$150,000 for term policies and $50,000 for whole life. You will need to purchase a policy directly through New York Life, this means contacting an agent if you need more coverage.
AARP Life Insurance Complaint Index
Data from the National Association of Insurance Commissioners (NAIC) show that New York Life, the insurer of AARP’s life insurance plans, receives significantly fewer complaints than one might anticipate given the company’s size.
The NAIC releases a complaint index that quantifies a company’s complaint volume in relation to its size. Businesses with more complaints than one might anticipate given their size have an index of 1.0. Businesses with fewer complaints than anticipated have an index below 1.0, and those with more complaints than anticipated have an index over 1.0. Fewer complaints are made to a corporation, hence the lower the index, the better.
New York Life’s three-year average complaint index is 0.177, indicating that it receives much fewer complaints than would be expected given its size. New York Life has one of the lowest complaint indexes among the 91 life insurance providers we examined.
AARP Life Insurance Third-Party Ratings
AARP Life Insurance is not rated by third-party organizations, but New York Life has good ratings for them, especially when it comes to financial stability. New York Life has an A++ financial strength rating from AM Best, which is the highest grade possible and indicates a superior ability to honor its ongoing insurance obligations such as claims.
New York Life, on the other hand, performs less well in terms of client satisfaction. It ranked 10th out of 22 insurance firms and received an overall customer satisfaction rating that was barely over average in J.D. Power’s 2022 U.S. Individual Life Insurance Survey. It received a score of 775 out of 1,000 points, which is just one point more than the industry average of 774.
AARP Life Insurance Available Riders
Life insurance riders are endorsements that can broaden or extend your life insurance coverage. There aren’t many riders offered by AARP, but it does provide the following advantages:
- Term rider: Your coverage limits are increased when you add the Term Rider Protect Plus for a predetermined amount of time. If your total insurance coverage does not exceed $150,000, you may apply for any amount of coverage between $2,500 and your current coverage maximum. Up until the age of 80, you’ll be covered. You can change the rider into a permanent life insurance policy from AARP if you require coverage after age 80.
- Terminal illness rider: This accelerated benefit rider (ABR) is included in all of AARP’s policies. If you get diagnosed with a terminal illness and are given less than 24 months to live, the rider allows you to receive a portion of the death benefit early (some riders may only trigger if you have less than 12 months to live). The rider is only available on guaranteed issue policies after the first two years of coverage.
- Waiver of premium for nursing home stays rider: The Term Rider Protect Plus also includes a waiver of premium rider that is tailored to nursing home stays. This rider would eliminate your life insurance payments after 180 consecutive days in a nursing home if a doctor determines that you must remain there.
Important Tips: Through AARP’s online customer service center, you can make payments, manage your beneficiaries, download policy documents, and more. You can also file life insurance claims online and access all the required documents electronically.
AARP Life Insurance Customer Service
You can reach the AARP Life Insurance Program by dialing (800) 607-6957, which is a toll-free number for customer care. The company is open from 8 a.m. to 8 p.m. EST Monday through Friday. If you have inquiries about registering for coverage via AARP, you may also contact New York Life directly at (800) 288-9858 between 8 a.m. and 8 p.m.
Final Judgment
AARP members can enjoy a simple and easy application process through AARP’s Life Insurance Program. With no medical exam required, an easy online application process, and only a couple of simple policies to choose from, AARP Life Insurance is worth considering for those who are shopping for a small life insurance policy. However, if you want to customize your policy with additional riders, require more than a low amount of coverage, or simply aren’t interested in paying for an AARP membership, you may want to consider other life insurance options.
Frequently Asked Questions about AARP Life Insurance
What is AARP life insurance?
A: AARP life insurance refers to life insurance policies offered by the American Association of Retired Persons (AARP). AARP collaborates with insurance providers to offer life insurance options specifically designed for its members.
Q: Who is eligible for AARP life insurance?
A: AARP life insurance is available to AARP members aged 50 and above. Membership with AARP is open to individuals who are at least 50 years old, regardless of their retirement status.
Q: What types of life insurance does AARP offer?
A: AARP offers two main types of life insurance: term life insurance and permanent life insurance. Term life insurance provides coverage for a specific period, typically 10, 15, 20, or 30 years. Permanent life insurance, such as whole life or universal life, offers lifelong coverage and includes a cash value component.
Q: How much coverage can I get with AARP life insurance?
A: The amount of coverage you can get with AARP life insurance depends on the specific policy and your individual circumstances. The coverage amount can range from a few thousand dollars up to several hundred thousand dollars.
Q: What is the process for applying for AARP life insurance?
A: To apply for AARP life insurance, you need to be an AARP member. You can visit the AARP website or contact their customer service to obtain information about the available life insurance options. The application process typically involves providing personal and medical information and may require a medical exam or completion of a health questionnaire.
Q: Can I get AARP life insurance if I have pre-existing health conditions?
A: AARP life insurance policies may be available to individuals with pre-existing health conditions, but eligibility and coverage options can vary. Some policies may require medical underwriting, while others may have simplified underwriting or guaranteed acceptance options. It’s best to check with AARP or the insurance provider for specific details based on your circumstances.
Q: Can I customize my AARP life insurance policy?
A: AARP life insurance policies may offer some degree of customization. You may have options to choose the coverage amount, policy duration, and additional riders or benefits to enhance your coverage. The extent of customization will depend on the specific policy you select.
Q: Can I cancel my AARP life insurance policy?
A: Yes, you can typically cancel your AARP life insurance policy. The cancellation process and any associated fees or refunds will depend on the policy terms and conditions. It’s advisable to review the policy documentation or contact AARP customer service for guidance on cancelation procedures.
Q: Are the premiums for AARP life insurance fixed or subject to change?
A: The premiums for AARP life insurance can be fixed or subject to change, depending on the policy you choose. Term life insurance premiums are typically fixed for the duration of the term. Permanent life insurance premiums can be fixed or may be subject to adjustment over time, depending on the policy terms and the type of coverage you select.
Q: What happens if I outlive my term life insurance policy with AARP?
A: If you outlive your term life insurance policy with AARP, the coverage will typically expire at the end of the term you selected. However, some policies may offer the option to convert to a permanent life insurance policy or renew the term coverage, though these options may be subject to certain conditions and limitations. It’s essential to review the policy terms to understand your options.
Does AARP Life Insurance Increase With Age?
Yes, term life insurance premiums typically increase as you grow older. As with most types of insurance, the higher the risk for the insurance company, the higher your premium costs will be. AARP’s term life insurance rates will rise as you enter each new five-year age bracket. Rates for AARP’s permanent life insurance are guaranteed to stay the same over the life of the policy, but this means they’re typically higher than the costs for term life insurance.
How Much Does AARP Life Insurance Pay Out?
AARP Life Insurance coverage depends on the policy you choose. Level Benefit Term Life Insurance offers protection between $10,000 and $150,000, while Permanent Life Insurance offers up to $50,000 in protection.
Can I Cash Out My AARP Life Insurance?
Yes, you can cash out your AARP life insurance. A portion of your permanent life insurance premium payments will go toward cash value that will eventually grow to be tax-deferred. You can then take a loan against your accumulated cash value to help with an unexpected expense. However, if you pass away before you finish paying back the loan, the loan amount and any interest due will be deducted from the death benefit.
Are There Any Death Benefits for AARP Members?
AARP members are eligible to apply for AARP’s Life Insurance Program. Since only members can apply, there are no additional benefits at the time of death for AARP members. However, AARP membership does grant survivors access to an online grief community and resources from experts on grief and loss.