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 18 or older can join, but life insurance availability is limited to members 50 or older, plus eligible spouses.
As individuals approach retirement age, securing financial stability becomes increasingly important. AARP, the American Association of Retired Persons, offers a range of services and products to support the needs of older adults, including life insurance policies tailored to their unique circumstances. In this guide, we’ll delve into the specifics of AARP life insurance policies issued in the USA, exploring their features, benefits, and considerations.
Understanding AARP Life Insurance Policies
1. Types of AARP Life Insurance:
A. Term Life Insurance: AARP offers term life insurance policies designed to provide coverage for a specific period, typically ranging from 10 to 30 years. These policies offer death benefits to beneficiaries if the insured passes away during the term.
B. Permanent Life Insurance: AARP also provides permanent life insurance options such as whole life insurance, which offers coverage for the entire lifetime of the insured individual, as long as premiums are paid. Whole life policies also accumulate cash value over time, which can be borrowed against or used to pay premiums.
2. Features and Benefits:
A. Guaranteed Acceptance: One of the most significant advantages of AARP life insurance policies is the guaranteed acceptance feature, which means individuals can secure coverage without the need for a medical exam or answering health questions.
B. Fixed Premiums: AARP life insurance policies typically come with fixed premiums, providing policyholders with predictable costs throughout the life of the policy.
C. Death Benefits: In the event of the insured’s death, AARP life insurance policies pay out a death benefit to the designated beneficiaries. This benefit can help cover funeral expenses, outstanding debts, and provide financial support to loved ones.
D. Cash Value Accumulation: Permanent life insurance policies offered by AARP accumulate cash value over time, which grows tax-deferred. Policyholders can access this cash value through policy loans or withdrawals, providing a valuable source of funds for various needs.
3. Considerations Before Purchasing:
A. Coverage Needs: Before purchasing an AARP life insurance policy, individuals should assess their coverage needs based on their financial obligations, outstanding debts, and the needs of their beneficiaries.
B. Premium Affordability: While AARP life insurance policies offer valuable benefits, individuals should ensure that the premiums fit within their budget and are sustainable over the long term.
C. Policy Terms and Conditions: It’s essential to carefully review the terms and conditions of the policy, including any limitations, exclusions, and provisions related to coverage and benefits.
D. Comparison Shopping: Before making a decision, individuals may benefit from comparing AARP life insurance policies with offerings from other insurers to ensure they’re getting the most suitable coverage at a competitive price.
AARP life insurance policies
Term life insurance. AARP members ages 50 to 74 and their spouses ages 45 to 74 can apply, and the coverage can last until the insured’s 80th birthday. Although the death benefit stays level through the term, the annual price increases each time the insured person enters a new five-year age band. A term life policy can be converted to permanent insurance at or before age 80. The rates for permanent coverage will be based on age. The AARP term life product features coverage amounts of $10,000 to $150,000 (or $100,000 in New York), although higher amounts may be available by calling New York Life. Applicants answer a few health questions and provide other health information, but do not have to take a life insurance medical exam.
Whole life insurance. AARP members ages 50 to 80 and their spouses ages 45 to 80 can apply. The annual price stays level, and coverage lasts throughout your life — though you can stop making premium payments once the policy is considered paid up (typically at age 95). Up to $50,000 of coverage is offered through the online application, although higher amounts may be available by calling New York Life. Acceptance is based on answers to a few health questions.
Guaranteed acceptance whole life insurance. AARP members ages 50 to 80 and their spouses ages 45 to 80 can apply. In New York, coverage is open to members and their spouses ages 50 to 75. Acceptance is guaranteed, and no health questions are required for approval. However, only a portion of the death benefit (110% of the premiums paid in most states) is paid out if the insured dies of natural causes in the first two years of the policy. The full benefit is paid from the first day of coverage for an accidental death. Up to $25,000 of coverage is featured, but higher coverage options may be available by calling New York Life. Guaranteed acceptance whole life is not available in all states.
4. How to Apply:
A. Individuals interested in AARP life insurance can apply online, over the phone, or through mail-in forms provided by AARP.
B. During the application process, applicants will need to provide personal information, including their age, gender, and state of residence, to determine eligibility and premium rates.
C. Once the application is submitted and approved, coverage typically begins upon receipt of the first premium payment.
AARP customer complaints and satisfaction
Over three years, AARP has drawn fewer than the expected number of complaints to state regulators for a company of its size, according to a NerdWallet analysis of data from the National Association of Insurance Commissioners.
AARP life insurance policies offer valuable protection and financial security for older adults and their families. With features such as guaranteed acceptance, fixed premiums, and death benefits, these policies can provide peace of mind and help individuals navigate their retirement years with confidence. However, it’s crucial to carefully consider coverage needs, affordability, and policy terms before making a decision. By understanding the specifics of AARP life insurance policies, individuals can make informed choices that align with their financial goals and priorities.
