AARP Term Life Insurance Review

AARP LIFE INSURANCE REVIEW

AARP is a non profit organization with a mission of helping those that are age 50 and over have more choices and independence in their lives. So when I looked into AARP’s life insurance program, I was a bit surprised. It is my opinion that the product that AARP is offering is not beneficial to most seniors. AARP does not offer more than $100,000 worth of coverage and only works with NY Life – just 1 insurance company – which is why rates are not competitive as you will see by reading this article. In this article, I will break down what AARP offers to seniors and how it stacks up against the competition. So if you are considering getting a life insurance policy with AARP, read this first so that you are armed with the knowledge you need.

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AARP Term Life Insurance Review: Products that AARP Offers:

 

AARP offers 2 types of term life insurance products. Let’s take a look at each one, get some quotes, and compare what the competition offers.

AARP Level Benefit Term Life Insurance

 

Here are the highlights of this product:

 

  • Up to $50,000 in coverage
  • Can last up to age 80
  • Premiums that increase over time
  • No physical exam
  • Acceptance based on answering 3 health questions

 

The first problem I have with this product is that typically with Level Term Insurance, rates stay level for the entire length of the policy. With AARP rates increase every 5 years, and are not guaranteed.

 An example of a healthy 60 year old male applying for coverage with AARP vs its competitors:

With AARP a 60 year old male getting a $50,000 policy would start out paying $108.25 per month. At age 65 the rate would increase to $143.96 per month and from age 70-74 the policy would increase to $207.25 per month. Over a 15 year period, total cost would be $27,567,which averages out to be $153 per month over a 15 year period.

 

AGE 60-64 $108.25 Per Month
AGE 65-69 $143.96 Per Month
AGE 70-74 $207.25 Per Month
Total Average Per Month $153 Per Month

 

How does that compare to a 15 year level term policy with other life insurance companies?

 

Since most other term life insurance companies offer term life starting at $100,000 I’ll compare AARP coverage to $100,000 term life coverage with other insurance companies.  Depending on your health rating here are some quotes from other carriers:

 

Preferred Plus Non Tobacco Health Rating:

 

Prudential Life Insurance $100,000 AARP $50,000 Term Life
$46 per month for 15 years Average of $153 Per Month

 

 Preferred Non Tobacco Health Rating:

 

Prudential Life Insurance $100,000 AARP $50,000 Term Life
$57 per month for 15 years Average of $153 Per Month

 

Standard Plus Non Tobacco Health Rating:

 

Met Life $100,000 Life Insurance AARP $50,000 Term Life
$67.50 per month for 15 years Average of $153 Per Month

 

Standard Non Tobacco:

 

Prudential $100,000 Life Insurance AARP $50,000
$88.56 per month Average of $153 Per Month

 

Even if you aren’t in perfect health and only qualify for a Standard Non Tobacco rating – You are still saving 40% off AARP’s Price and getting twice the coverage!

And while a 15 year term policy with other life insurance companies is guaranteed not to increase in price, AARP’s term life insurance is not guaranteed. Prices are subject to change.

 

AARP Extra Protection Term Life Insurance:

 

AARP’s Extra Protection Term Life is very similar to its level benefit term life, except that you can get up to $100,000 in coverage and there are more requirements to get approved.

Let’s use our example of a 60 year old male again, except this time for $100,000 policy that will last 15 years.

 

With AARP rates go up every 5 years, and while they publish the rates, they are not guaranteed and could go up. For the purposes of this example, let’s assume that the AARP rates don’t increase over the life of this policy.

Between age 60-64 for $100,000 policy a man would be $129.92 per month.
At age 65, rates are set to increase to $174.92 per month, and at age 70-74 rates are set to increase once again to $258.92 per month. Total spent over 15 years would be $33,825 or an average of $187.91 monthly over 15 years.

As you saw in my example above, if you were to apply with companies like Metlife or Prudential or many of the other carriers we represent, you would pay significantly less, anywhere from $46 per month to $153 per month, depending on your health. A hugsavings compares to AARP’s pricing.

 

It is my opinion that AARP does not offer a ‘good deal to seniors. Don’t just take my word for it, you can read an article posted by CBS News titled “Life Insurance and Annuities: Is AARP Looking Out For You”.

 

It is disappointing that AARP does not do more for its members in terms of life insurance coverage.  I recommend that you compare life insurance quotes on our website by filling out the form below or calling us. We’re confident we can help you get much better pricing and more comprehensive coverage than what AARP offers.

Instant Life Insurance Quote
State: 
Birthdate: 
Gender:  Male     Female 
Smoker/Tobacco:  Yes    No 
Health Class: 
 Type of Insurance:   
Face Amount: 
Your Name: 
Phone Number: 
E-mail Address: 

Author: Liran Hirschkorn

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Liran Hirschkorn

Liran Hirschkorn is the founder of Chooseterm.com. His mission is to help individuals across the country in finding the best rates on life insurance as well as helping individuals with high risk life insurance.

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