Has a friend or acquaintance talked to you about Primerica? Has someone representing Primerica offered to meet with you for a financial needs analysis? Has anyone tried to recruit you to join Primerica? Primerica, a multi-level marketing company, once a part of Travelers/Citigroup, became its own independent public company in 2010, and its stock is listed on the New York Stock Exchange. If you have never heard of Primerica, there are pretty good odds eventually someone you know will become a Primerica representative, and will want to meet with you to help you with life insurance and investments. This review will discuss Primerica, examine the competitiveness of Primerica’s term life insurance rates against other life insurance companies, and explain why it’s probably best for you to avoid Primerica and its representatives.
Primerica & Primerica Term Life Insurance Rates Review
Primerica started as a company named A.L. Williams in 1977, and markets the sale of life insurance and mutual funds under the concept of “buy term and invest the difference.” There is nothing wrong with the concept of buying term and investing the difference, which advocates not buying the more expensive, permanent “cash value” life insurance, which some Primerica representative will derisively refer to as “trash value” life insurance, instead buying inexpensive term life insurance and investing the money you are not spending on permanent life insurance, so when the term insurance expires, you have a substantial nest egg from your investment returns, and won’t need life insurance.
There are drawbacks to the “buy term and invest the difference” strategy, which I will eventually write about in another blog post, but critiquing this approach is not the topic of this review. Buying term life insurance instead of permanent life insurance may be the best choice for fulfilling certain needs or for many consumers.
However, in spite of what some Primerica representatives may tell you, the way to get the best results from buying term and investing the difference, is to not overpay through buying term life insurance with high rates for the amount of coverage and length of term you need, and not buying mutual funds with sales commissions and high annual fees. As this review will show you, these are both problems with Primerica: expensive term life insurance rates and mutual funds with sales loads and/or expensive management fees, which greatly reduce investment returns.
The majority of this Primerica review will analyze the competitiveness of its term life insurance rates, but first, I want to explain a few concerns about doing business with a Primerica representative.
Replacing Permanent or “Cash Value” Life Insurance Policies with Term Life Insurance
It’s one thing to say it’s not a good idea to buy permanent life insurance, but an entirely another thing to tell someone they need to replace their permanent life insurance policy with a term life insurance policy. The very thing that makes buying a permanent cash value life insurance a poor decision is surrendering the policy too soon, and paying policy surrender fees. Don’t allow an agent to sell you term life insurance by replacing a permanent life insurance policy, without talking to an agent representing the company insuring you under the permanent life insurance company, so you can decide on the best course of action. For example, instead of cashing in the permanent life insurance policy, it may be better for you to use the cash value to buy permanent paid-up coverage. Good life insurance agents will show you the pros & cons of each option available to you.
Primerica Agents
Most experienced, professional life insurance agents sell life insurance full-time, have received training on many different life insurance products over the course of their career, know the strengths and weaknesses of the types of life insurance policies and companies in the market, understand the process of applying for and obtaining life insurance, and can help their clients avoid problems and declined applications.
Many Primerica representatives are part-time, and they are trained to recruit as much as they are trained to sell Primerica life insurance and mutual funds. You are likely to run into a recently recruited Primerica representative lacking real knowledge to give life insurance and investment advice. Primerica representatives are properly licensed, but usually don’t know anything more than what they have been told by their upline recruiter. Barely qualified life insurance agents trained to sell the term life insurance of only one company can’t offer their clients much but the likelihood of complaints and customer dissatisfaction. Evidence of this is provided below:
1. Primerica received the lowest score & rating for life insurance customer satisfaction in the latest 2014 JD Power Life Insurance Customer Satisfaction Study out of 22 major US life insurance companies.
2. Here are Primerica’s life insurance customer complaint statistics. The lower the complaint ratio number, the lower the number of life insurance complaints:
2013 Life Insurance Complaint Ratio = .27
2012 Life Insurance Complaint Ratio = .20
2011 Life Insurance Complaint Ratio = .32
By comparison, here are the life insurance customer complaint statistics for Prudential. Primerica has more than six times the number of life insurance complaints than Prudential, adjusted for market share.
2013 Life Insurance Complaint Ratio = .01
2012 Life Insurance Complaint Ratio = .03
2011 Life Insurance Complaint Ratio = .05
Primerica is a MLM company, known for having a cult-like atmosphere, and they not only want to sell you insurance, they want to recruit you to work for them. This company culture may work for products like Herbal Life or Tupperware, but it does not create professional life insurance agents.
Buying Mutual Funds with Sales Commissions and/or Higher Expense Fees Greatly Reduce Investment Returns
It’s not unusual for the average person, unfamiliar with the concepts of personal finance, to want professional advice when investing. Unfortunately, most financial advisers are salesmen, and they can’t help you get a better return that compensates for the commissions, management and/or expense fees on the mutual funds they sell. If you know nothing about investing, I encourage you learn about the simplicity and advantages of no-load index mutual funds through companies like Vanguard & Fidelity. You’ll be surprised how easy it is for you to learn how choose investments to secure your financial future on your own. If you still think you need help, choosing a fee-only financial adviser is likely you to get you the least biased advice, and save you the most money in the long run.
This 60 second guide from The Motley Fool website explains index investing.
Primerica Term Life Insurance Rates
Overall, many life insurance companies, with the same or better AM Best financial strength rating as Primerica, have better term life insurance rates, although Primerica has very competitive standard smoker rates for men for a ten year term life insurance policy, and for certain ages with a twenty year term life insurance policy. I should have the survey completed by December 1st, 2014, so if your age group is not posted yet, check back after November, and my rate survey should be complete.
Primerica has three health rating categories for non-tobacco users: Non-smoker, Preferred Non-smoker, and Preferred Plus Non-smoker. For Tobacco users, Primerica has one health rating class: Smoker.
Primerica 20 Year Term Life Insurance Rates
Below is a survey of Primerica Life Insurance Company’s rates for a twenty-year level premium term life insurance policy:
Male, Non-smoker, Age 20-29
Not competitive
Reviewing different health classes (preferred plus, preferred, standard, etc.) and different face amounts ($250,000 to $6 million) for this gender (male) and age group (20-29), Primerica does not have low term life insurance rates. For example, a 25 year-old male non-smoker looking for a $500,000 20-year term life insurance policy would pay $405 annually with Primerica’s preferred non-smoker rates, but only $315 a year at preferred non-smoker rates with Ohio National Life Assurance Corporation. At standard non-smoker rates, Primerica would be $545 a year, and Ohio National Life Assurance Corporation would be $455 a year. Companies such as Banner, Metlife, Protective, New York Life, and others routinely have much better term life insurance rates than Primerica for this gender and age group regardless of health class or the amount of coverage.
Male, Smoker, Age 20-29
Not competitive at preferred smoker rates, but very competitive at standard smoker rates
If you are a male smoker in this age group (20-29) and you are in very good health, qualifying for the best health category of smoker rates, Primerica’s term life insurance rates are often higher than many companies, among different amounts of coverage ($250,000 – $6 million), such as Metlife, American General, Banner, Columbus, Ohio National, and others. However, if you do not qualify for preferred smoker rates, Primerica often is among the several companies having the lowest standard smoker rates for this gender (male) and age group (20-29) regardless of the amount of coverage, though occasionally companies like Assurity, Northwestern Mutual, and Cincinnati Life will have lower rates than Primerica.
Female, Non-smoker, Age 20-29
Not competitive
Reviewing different health classes (preferred plus, preferred, standard, etc.) and different face amounts ($250,000 to $6 million) for this gender (female) and age group (20-29), Primerica does not have low term life insurance rates. For example, a 26 year-old female non-smoker looking for a $1,000,000 20-year term life insurance policy would pay $1,015 annually with Primerica’s standard non-smoker rates, but only $635 a year at standard non-smoker rates with Ohio National Life Assurance Corporation. Most life insurance companies, including Mass Mutual, Prudential, Banner, Metlife, Protective, New York Life, and others routinely have much better term life insurance rates than Primerica for this gender and age group, regardless of health class or the amount of coverage.
Female, Smoker, Age 20-29
Not competitive
Primerica’s smoker rates are more competitive than its non-smoker rates for this gender and age group, but there are still quite a few life insurance companies having much better term life insurance rates among different health classes (preferred plus, preferred, standard, etc.) and different face amounts ($250,000 to $6 million). For example, a 27 year-old female non-smoker looking for a $300,000 20-year term life insurance policy would pay $594 annually at Primerica’s non-smoker rates, but only $471 a year at standard non-smoker rates with Banner Life Insurance Company. Life insurance companies, such as Banner, Northwestern Mutual, TIAA-CREF, AXA, Pacific, Transamerica, and Prudential routinely have much better term life insurance rates than Primerica for tobacco users in this gender and age group, regardless of health class or the amount of coverage.
Male, Non-smoker, Age 30-39
Not competitive
Reviewing different health classes (preferred plus, preferred, standard, etc.) & different face amounts ($250,000 to $6 million) for this gender (male) and age group (30-39), Primerica does not have competitive term life insurance rates. For example, a 35 year-old male non-smoker looking for a $2,000,000 20-year term life insurance policy would pay $2,435 annually with Primerica’s standard non-smoker rates, but only $1,805 a year at standard non-smoker rates with Ohio National Life Assurance Corporation. At preferred rates, Primerica would cost $1,675 a year and MetLife Investors USA Insurance Company would cost $1,169 a year. Most life insurance companies, including Prudential, Pacific, Banner, Metlife, Protective, New York Life, Mutual of Omaha, Savings Bank Life Insurance Co of MA and others routinely have much better term life insurance rates than Primerica for non-smokers in this gender and age group, regardless of health class or the amount of coverage.
Male, Smoker, Age 30-39
viagra in india In the United Kingdom alone, 3 out of 8 males have problem with sleep and every 1 out of these men, 30% men had vitamin D deficiency. buy cheap viagra Possible Complications of Kamagra Like with all medication, Kamagra can cause complications and unwanted side effects for some people. Please consult a doctor for further information icks.org purchase levitra online if you are looking for osteopath at Stanmore who can help in getting the medication at their doorstep. As a search engine optimization company we are constantly monitoring continue reading over here discount viagra several markets to stay up to date on the latest happenings, but are we happier? Remember when the highlight of Sunday was watching Abbott and Costello? We could also look forward to watching The Bowery Boys or Tarzan.
Not competitive at preferred smoker rates, but somewhat competitive at standard smoker rates
If you are a male smoker in this age group (30-39) and you are in very good health, qualifying for the best health category of smoker rates, Primerica’s term life insurance rates are often higher than many other life insurance companies, among a range of different amounts of coverage ($250,000 – $6 million). For male smokers not qualifying for the preferred or preferred plus rates in this age group (30-39), Primerica is more competitive but does not usually have the lowest rates. Life insurance companies such as Northwestern Mutual, Transamerica, & TIAA-CREF have better or about the same rates for face amounts under $500,000. Primerica has competitive term life insurance rates for male smokers age 30 through 33, for face amounts of coverage $500,000 or more. But after age 33 and until age 39, more & more life insurance companies have better standard smoker term life insurance rates than Primerica the older your age.
Female, Non-smoker, Age 30-39
Not competitive
Once again reviewing the different health classes (preferred plus, preferred, standard, etc.) & different face amounts ($250,000 to $6 million) for this gender (female) and age group (30-39), Primerica does not have competitive term life insurance rates. For example, a 36 year-old female non-smoker looking for a $750,000 20-year term life insurance policy would pay $997.50 annually with Primerica’s standard non-smoker rates, but only $712.50 a year at standard non-smoker rates with Banner Life Insurance Company. Most life insurance companies have much better term life insurance rates than Primerica for non-smokers in this gender & age group, regardless of health class or the amount of coverage.
Female, Smoker, Age 30-39
Not competitive
At different face amounts ($250,000 to $6 million) for this gender (female) and age group (30-39), Primerica does not have competitive term life insurance rates. For example, a 37 year-old female smoker looking for a $600,000 20-year term life insurance policy would pay $1,989 annually with Primerica’s smoker rates, but only $1,487 a year with the standard smoker rates for Pacific Life Insurance Company. Many life insurance companies, such as Minnesota Life, Penn Mutual, Midland & Mutual of Omaha & others, regularly have much better term life insurance rates than Primerica for non-smokers in this gender & age group, regardless of health class or the amount of coverage.
Male, Non-smoker, Age 40-49
Not competitive
Once again, across different health classes (preferred plus, preferred, standard) & different face amounts ($250,000 to $6 million) for non-smokers of this gender (male) and age group (40-49), Primerica does not have competitive term life insurance rates. For example, a 45 year-old male non-smoker looking for a $500,000 20-year term life insurance policy would pay $1,210 annually with Primerica’s standard non-smoker rates, but only $1,140 a year at standard non-smoker rates with Transamerica Life Insurance Company. At preferred rates, Primerica would be $880 a year, and MetLife Insurance Company USA would be $724 a year. Many life insurance companies have much better term life insurance rates than Primerica for non-smokers in this gender & age group, regardless of health class or the amount of coverage.
Male, Smoker, Age 40-49
Not competitive at preferred smoker rates, but competitive at standard smoker rates age 48-49
If you are a male smoker in this age group (40-49) and you are in good health, qualifying for better than the standard health category of smoker rates, Primerica’s term life insurance rates are often higher than many other life insurance companies, among a range of different amounts of coverage ($250,000 – $6 million). If you are paying monthly, other life insurance companies have lower monthly rates, except at age 48 for coverage amounts from $150,000 to under a million dollars, and at age 49 for coverage amounts from $150,000 to $6,000,000.
Primerica term life insurance rates are not very competitive at ages 40 through 43 for male smokers. For male smokers age 44 or 45, Primerica has competitive rates if you pay in full each year, for coverage amounts from $250,000 to under $5,000,000, but other life insurance companies have better rates if paying monthly. For male smokers age 46 or 47, Primerica has competitive rates if you pay in full each year, for coverage amounts from $250,000 ($150,000 for age 47) to $6,000,000, but some other life insurance companies have better rates if paying monthly.
Except for ages 48 & 49, if you qualify for TIAA-CREF (you need to work in education), TIAA-CREF usually has better monthly & annual rates than Primerica.
For example, a 45 year old male smoker looking for a 20 year term life insurance policy for $250,000 would pay $1,665.00 year with Primerica, and $1,577.50 with TIAA-CREF. But the cost if paying monthly with Primerica is $158.18, but only $145.91 with Transamerica Life Insurance Company, even though the cost with Transamerica Life Insurance Company if paying once a year is $1,667.50, slightly more than Primerica. In this example, Banner, Pacific Life, Savings Bank Life Insurance Co of MA, and Columbus Life all have a lower monthly premium than Primerica.
However, if you are a male smoker age 48 or 49, and you don’t qualify for preferred smoker rates with other life insurance companies, Primerica may have best priced 20 year term life insurance for you.
Female, Non-smoker, Age 40-49
Not competitive
As with the prior female non-smoker age groups, looking at different health classes (preferred plus, preferred, standard) & different face amounts ($150,000 to $6 million) for non-smokers of this gender (female) and age group (40-49), Primerica does not have competitive term life insurance rates. For example, a 44 year-old female non-smoker looking for a $750,000 20-year term life insurance policy would pay $1,177.50 annually with Primerica’s preferred non-smoker rates, but only $757.50 a year with the preferred non-smoker rates of Lincoln National Life Insurance Company. At standard non-smoker rates, Primerica would be $1,642.50 a year, and Protective Life Insurance Company would be $1,240.29 a year. Most life insurance companies have much better term life insurance rates than Primerica for non-smokers for this gender & age group, regardless of health class or the amount of coverage.
Female, Smoker, Age 40-49
Not competitive
As with female non-smokers age 40 – 49, Primerica does not have competitive term life insurance rates across different amounts of coverage ($100,000 to $6,000,000) for a level premium twenty year term life insurance policy. For example, a 47 year-old female smoker looking for a $300,000 term life insurance policy would pay $2,274.00 annually with Primerica, but only $1,785.00 a year with Transamerica Life Insurance Company. Most life insurance companies have much better term life insurance rates than Primerica for smokers in this gender & age group.
Male, Non-smoker, Age 50-60
Not competitive
Among different health classes (preferred plus, preferred, standard) and different face amounts ($250,000 to $6 million) for this gender (male) and age group (50-60), Primerica does not have low term life insurance rates. Of the three health classes for non-smokers offered by Primerica, the standard rates are the closest to being competitive with other companies, but still fall short of low rates. For example, a 52 year-old male non-smoker looking for a $300,000 20-year term life insurance policy in the standard health class would pay $134.81 a month with Primerica, but pay only $116.34 a month with Midland National Life Insurance Company. Primerica comes the closest to being competitive for the standard health class, for the ages of 55 to 57, with face amounts from $500,000 to under $1,000,000. But seven other life insurance companies still have better rates. For example, a 55 year-old male non-smoker looking for a $500,000 20-year term life insurance policy in the standard health class would pay $278.35 a month with Primerica, but pay only $251.56 a month with Transamerica Life Insurance Company. Life insurance companies such as Transamerica Life Insurance Company, Protective Life Insurance Company, Banner Life Insurance Company, MetLife Insurance Company USA, Ohio National Life Assurance Corporation, American General Life Insurance Company, Savings Bank Life Insurance Company of MA, Midland National Life Insurance Company, and North American Company for Life and Health have better or the same term life insurance rates in this example. It’s not hard to find much lower rates than Primerica for this gender and age group regardless of health class or the amount of coverage.
Male, Smoker, Age 50-60
Not competitive at preferred smoker rates, but very competitive at standard smoker rates ages 50 through 60
If you are a male smoker in this age group (50-60) and you are in good health, qualifying for a better health category (such as preferred) than the standard health category of smoker rates, Primerica term life insurance rates are higher than the term life insurance rates of many other life insurance companies, among a range of different amounts of coverage ($150,000 – $6 million).
However, if you qualify for smoker rates with Primerica, and do not qualify for standard plus, preferred, or preferred plus smoker rates with other life insurance companies, Primerica has some of the best monthly or annual term 20 year term life insurance rates for male smokers age 50-60, for coverage amounts from $150,000 to $6,000,000. Although a few other companies, such as Banner, Savings Bank Life Insurance Company of MA, or Cincinnati Life Insurance Company, will occasionaly have a somewhat lower monthly rate than Primerica. If you qualify for TIAA-CREF (you need to work in education), TIAA-CREF sometimes has better annual and/or monthly standard smoker term life insurance rates than Primerica in this gender and age group, too.
For example, a 54 year old male smoker looking for a 20 year term life insurance policy for $150,000 would pay $194.80 a month with Primerica, and $192.28 a month with Banner Life Insurance Company, making male smokers in this age group one of the most competitive for Primerica. If you are a male smoker in the age range of 50 to 60 years old, and you don’t qualify for preferred smoker rates with other life insurance companies, Primerica may have best priced 20 year term life insurance for you.
Female, Non-smoker, Age 50-60
Not competitive
Among the different health classes of preferred plus, preferred, and standard, and among different face amounts ($100,000 to $6 million) for this gender (female) and age group (50-60), Primerica does not have low term life insurance rates compared to most other life insurance companies. For example, a 55 year-old female non-smoker looking for a $100,000 20-year term life insurance policy in the standard health class would pay $107.54 a month with Primerica, but pay only $44.78 a month with New York Life Insurance Company. It’s not hard to find a better price than Primerica for this gender and age group regardless of health class or the amount of coverage, since most life insurance companies have much better rates than Primerica for a 20 year term life insurance policy.
Female, Smoker, Age 50-60
Not competitive
As with female non-smokers age 50 – 60, Primerica does not have competitive term life insurance rates across different amounts of coverage ($100,000 to $6,000,000) for a level premium twenty year term life insurance policy. For example, a 51 year-old female smoker qualifying for the standard smoker health class looking for a $250,000 term life insurance policy, would pay $236.55 a month with Primerica, but only $166.86 a month with MetLife Insurance Company USA. Most life insurance companies have much better term life insurance rates than Primerica for female smokers in this gender & age group.
Primerica 10 Year Term Life Insurance Rates
Whenever you see term life insurance advertised for a very low price, such as under $20 a month, it’s usually a ten year term life insurance policy being quoted. The problem with a ten year term life insurance policy is there is a strong chance the average person is still going to need life insurance after the 10 years, but they may then have a hard time finding affordable coverage if they have developed a health condition. Term life insurance policies with other life insurance companies usually have an option to convert to permanent coverage, which can be extremely important to use if your health no longer allows you to qualify for a new term life insurance policy.
However, Primerica does not offer any permanent life insurance coverage, so there are no conversion options on their term life insurance policies. If, for example, you are eight years into a ten year term policy with Primerica and you develop a life-threatening brain tumor, you may not have any option to make sure your family continues to have the life insurance protection you need, if you die once the ten year term policy has expired.
Primerica does not have competitive ten year term life insurance rates in general. If you are a woman, or if you qualify for better than standard rates, or if you are paying monthly, Primerica’s 10 term life insurance rates are higher than most life insurance companies. But if you are male non-smoker qualifying only for standard rates, 55 years old to 63 years old, looking for coverage from $250,000 to $900,000 (up to 6 million ages 55-59), Primerica has one of the lowest ten year term life insurance rates, if paying annually.
For male smokers age 18 to 70 years old qualifying for no better than standard rates, looking for coverage from $250,000 to $6,000,000, Primerica often has the best term life insurance rates, whether paying annually or monthly.
Primerica Life Insurance Review Summary
Primerica term life insurance is sold by usually inexperienced part-time agents representing only one life insurance company, and even the experienced Primerica representatives rarely know anything more about life insurance & investing than they’ve been taught by Primerica. Given its poor rating for life insurance customer satisfaction by JD Power, and over-priced term life insurance rates in most situations, I would avoid Primerica and its representatives. Although Primerica has good information promoting financial literacy and explaining the power of compounding investment returns over time, buying life insurance or investments from Primerica can be an expensive mistake.
If you want a reputable & financially sound life insurance company, competitively priced rates, the proper type of policy for you, and a smooth process buying the coverage you need, comparison shop with several life insurance agents & agencies, so you can find an agent offering the best life insurance options for you at a low price. Life insurance can be adjusted to fit any person’s budget, & a good agent representing many life insurance companies and having knowledge of the market can help find the best life insurance policy for you.
As you’ve seen in this review, some life insurance companies charge more than double the price of other companies for the same coverage. No single life insurance company has the best rates for everyone. Many people pay too much for their insurance because they never shop for better rates, or if they do shop, they don’t comparison shop with enough agents. Your life insurance needs & health change over time, so you should shop & review your coverage every one or two years.
For more information, I surveyed the companies with the best term life insurance rates in these reviews here, which you can use to help you shop and find the life insurance coverage you need at the lowest rates.
What do you think about this review of Primerica & its term life insurance rates? Comment or ask me questions on my facebook page. Follow me on Twitter for important insurance consumer news & new blog entries at CarInsWatch.