If you have reached the age of 50 or above, then you have received countless mailers from the American Association of Retired Persons (AARP). These mailers are meant to inform you of the benefits that having a membership with AARP offers.
Many people really start to consider life insurance at this stage of their lives, wanting to protect their loved ones financially when they pass away. AARP understands this and that’s why they market their life insurance so aggressively. Lets take a look at AARP’s permanent products offered:
AARP Permanent Products
AARP’s life insurance products are issued through New York Life Insurance Company for its members. There three permanent life insurance products and all are no-medical exam life insurance. The three are:
AARP Whole Life
AARP Guaranteed Acceptance Whole Life
AARP Young Start Program/Children’s Whole Life
Issue ages for AARP whole life insurance policy is 50 to 80 years old, while covering a spouse aged 45-80 years old. You can purchase up to $50,000 of death protection, and approval is based on three questions.
AARP whole life policy also builds cash value that can be borrowed off of later down the road if a need arises. Remember any withdrawal of the cash value decreases the death benefit upon your death. It takes a few years before the cash value starts to accumulate.
Here are some rates for AARP Whole Life
AARP vs. Other Life Carriers
Male/ 50 years old/ $25,000 Death Benefit
AARP Rates for Women
If you are an AARP member between the ages of 50-80 you are eligible for AARP Guaranteed Acceptance Life Insurance up to $25,000 of life insurance with no medical questions asked. These policies do build up cash value, however the death benefit is limited the first two years.
In order to get the full death benefit in the first two years, death has to be by an accident. If death is by an illness the first two years, your beneficiary would receive 125% of the premium paid in. These types of policies are also called graded death benefit whole life.
These policies are a last resort when you cannot qualify for any type of traditional life insurance policy.
Let’s take a look at their rates:
AARP vs The Competition
Male/ 50 years old/ $10,000 Death Protection
AARP Rates for Women
Referred to as the Young Start Program, AARP’s children whole life is marketed to parents and grandparents, since you have to be a member to purchase. The parents/grandparents are the owner and beneficiary of the policy until the insured turns 21.
Young Start is for children up to age 17 with a maximum death benefit of $20,000. It’s a whole life policy so it builds cash value that can be borrowed from later in life, approval is based on three simple questions.
AARP’s Three Qualifying Questions
The three qualifying questions AARP ask on their Whole Life and Children’s Whole Life are:
- In the past 2 years, have you had treatment for or been diagnosed by a doctor as having heart trouble, stroke, cancer, lung disease or disorder, diabetes, liver or kidney disease, AIDS, AIDS Related Complex, or immune system disorder?
- In the past 2 years, for any condition, have you been admitted to or confined in a hospital, sanitarium, nursing home, extended care, or special treatment facility?
- In the past 3 months, have you consulted a doctor or had treatment or diagnostic tests of any type? (Note: You are not required to report negative AIDS or HIV tests.)
If you can answer NO to these questions then you qualify.
AARP Fits Whom?
AARP is a good fit for some consumers, especially if:
- If you have been charged with a felony, on parole, or under probation then AARP is a good choice. AARP does not ask about these issues like most other companies do.
- If you are obese, AARP is a good choice because they don’t ask about your weight. Even non-medical exam life insurance ask about your height and weight.
- Smokers should always look at AARP, because they simply do not ask.
If you are shopping for permanent life insurance, AARP’s permanent products probably will be overpriced compared to other companies. Although they are affiliated with New York Life, which is a great company, the policies sold through AARP just aren’t competitive.
We always recommend working with an experienced agent who can help you look at all options available. This will ensure you choose the most affordable policy that fits your unique situation. If we can be of help, please give us a call.