AARP Life Insurance Reviews [Bargain Rates or Rip-off]

aarp life insurance reviews

Does AARP have life insurance? AARP does not sell life insurance directly, but AARP does promote life insurance products underwritten by New York Life. 

AARP’s life insurance program from New York Life offers term life insurance and permanent life insurance for seniors as well as annuities, long-term care and even AARP life insurance for grandchildren and children!

Since AARP is known for providing its members with discounts, you would think that AARP life insurance rates for seniors would be some of the lowest around, but the truth is that AARP life insurance rates can be expensive compared to the best life insurance companies for seniors available today.

Our AARP life insurance review will give you the inside scoop on why AARP life insurance probably is not the right life insurance company for you.

We’ll cover AARP’s life insurance rates, financial strength, and how they stack up against the competition.

We will also cover if AARP makes the most sense and if they offer life insurance for high-risk individuals.

However, we always recommend that if you are trying to save time that you should stick to comparing rates and quotes with all life insurance companies.

You can do this easily below using our instant life insurance quotes rate engine to compare rates with 50 of the top-rated life insurance companies.

AARP Life Insurance will even be one of the options for the rates displayed that you can view depending on the parameters and coverage amount you are searching for.


Shall we begin?

AARP Life Insurance History

AARP was founded in 1958 by Dr. Ethel Perecy Andrus from an earlier project called the National Retired Teachers Association (NRTA), which Dr.

Andrus created in 1947 to promote her philosophy of productive aging and health insurance for retired teachers.

After 10 years, she opened her organization to any American over the age of 50, and AARP, as we know it, was born. Today, the NRTA is still around, but as a division of AARP.

However, there has been some controversy regarding the creation of the organization.

In the beginning, AARP was known as the American Association of Retired Persons, but it officially rebranded itself in 1999 as AARP.

This was done to signify that AARP did not service solely retired people anymore. Today, anyone over the age of 50 can become a full member of AARP.

AARP is active in issues that affect older Americans through lobbying efforts on both the state and federal levels of government. The organization is non-partisan and does not support any candidates or political parties.

In 1978, 60 Minutes reported an expose’ alleging that AARP had been established as a marketing device by Leonard Davis the founder of Colonial Penn Life Insurance after meeting with Dr. Andrus.

Critics claimed that AARP was heavily influenced by Davis who used its image as a non-profit champion of retirees to sell more insurance to members.

This was a huge accusation, and it is speculated the cause of why AARP began a competitive bidding process in 1980 and shifted their insurance contracts to Prudential Life Insurance in order to distance themselves from the scandal.

During the 1990s, the United States Senate investigated AARP’s non-profit status but did not find sufficient evidence to change the organizations status.

Today AARP life insurance, as well as annuities long-term care, is underwritten by New York Life exclusively.

New York Life recently extended their exclusive life insurance provider agreement with AARP through the year 2022.

If something should change in the meantime, we will update our review accordingly.

AARP Life Insurance Ratings and Financial Strength

AARP does not provide life insurance directly so you will need to look at the life insurance company who they partner with currently, New York Life, to evaluate the financial strength of their life insurance.

The good news is that New York Life has an iron-clad financial rating.

New York Life has been a trusted name for over 170 years receiving top ratings from many of the independent rating organizations.

New York Life (The Exclusive AARP Life Insurance Provider) Financial Strength Ratings

A.M. BestStandard & Poor’sFitchMoody’sBBB
A++AA+AAAAaaA+
  • A.M. Best – A++ (Superior)
  • Standard and Poor’s – AA+ (Very Strong)
  • Fitch – AAA (Exceptionally Strong)
  • Moody’s – Aaa (Highest Quality)
  • AARP’s Life Insurance Program gets an A+ BBB rating from the Better Business Bureau. This shows that when the occasional customer service dispute arises that AARP is quick to resolve the issue.

AARP Life Insurance Solutions

AARP does not sell life insurance so you will be working with a third-party and not AARP directly.

Currently, New York Life is the exclusive provider of AARP life insurance and will pay AARP royalties for each member who purchases a life insurance policy through their program.

New York Life offers term life insurance, whole life insurance, and guaranteed issue whole life insurance with simplified non-medical underwriting.

These products were designed for applicants over the age of 50, except for the Young Start whole life policy that is intended for grandchildren.

We will cover the features of each AARP life insurance policy in detail below.

We will cover how to apply for AARP life insurance if you can purchase AARP life insurance with no medical exam, and cover the AARP life insurance rates for seniors and children. Spoiler alert, you can do better.

AARP Term Life Insurance

Term life insurance is an excellent tool for protecting temporary death benefit needs like income replacement, mortgage protection, or college education expenses.

Once these needs go away, you can reevaluate your life insurance needs and determine if you still need or want to carry life insurance.

AARP’s Term Life Insurance Features

  • Death Benefits from $10,000 to $100,000
  • No Medical Exam
  • Easy Online Application
  • No Waiting Period for Coverage
  • Rates Increase Over Time

Term life insurance is usually associated as being inexpensive.

This is generally true when you are younger since you are covering the healthy years of your life. However, as you age the price gap between term and permanent life insurance closes.

How much is AARP term life insurance? AARP term life insurance cost will vary depending on what age bracket you fall into, which we display in the chart below.

Not only does term life insurance increase in cost as you get older, but AARP’s policy does not lock in your rate when you purchase the coverage.

 Buyer Alert! – Your AARP term life insurance rates increase as you enter each new five-year age band and will be based on the current rates during that time.

AARP Term Life Insurance Rates – Death Benefits $100,000*

Issue AgeMenWomen
50-54$79$52
55-59$116$69
60-64$171$108
65-69$236$154
70-74$342$272

 *Please note that the rates above are for people that have not used any form of tobacco or nicotine in the last 12 months.

Tobacco and nicotine users will pay a higher rate.

Now I don’t know about you, but most of the seniors we work with are on a fixed budget in retirement.

The last thing they need is their life insurance premiums doubling in ten years and becoming a strain on their budget.

Notwithstanding the increasing cost of AARP term life insurance, your life insurance needs evolve from temporary to permanent needs as you get older.

Using whole life insurance in estate planning, to pay for final expenses, or to merely leave an inheritance makes more sense since those are permanent needs.

Permanent life insurance, like whole life insurance, guarantees that your rates will never go up and that you can never outlive your death benefit protection.

This ensures that you will not outlast your life insurance and reduces the risk that you will have to drop your coverage since you cannot afford the increased premiums.

AARP Whole Life Insurance

AARP whole life insurance is a policy that offers substantial guarantees.

With whole life insurance, you get lifetime death benefits that you can never outlive, locked in monthly premiums for the rest of your life, and guaranteed cash value accumulation.

While term life insurance is used for temporary needs, like income replacement, whole life is a better fit for permanent needs like leaving money for your grandchildren’s education.

Whole life guarantees that when you need your insurance the most, it will be there.

AARP Whole Life Insurance Features:

  • Up to $50,000 of Death Benefits
  • Guaranteed rates that will not increase
  • No medical exam guaranteed
  • No death benefit waiting period
  • Builds cash value

AARP members ages 50 to 80 and their spouse’s ages 45 to 80 can apply for AARP whole life insurance as long as it is offered in the state that you live in.

While there is no medical exam required, you will need to answer some brief questions about your health, so it is not a guaranteed life insurance policy.

Issue AgeMenWomen
50$80$59
55$93$69
60$144$86
65$144$111
70$184$146

*Please note that the rates above are for people that have not used any form of tobacco or nicotine in the last 12 months.

Tobacco and nicotine users will pay a higher rate. Residents of MT have different rates from those shown above.

Your AARP whole life premiums end at age 95, but your coverage will continue if you live beyond that point.

The AARP whole life policy does have accelerated death benefit options for terminal illness, that is pretty standard among life insurance these days.

However, the waiver of premium for certainly qualified nursing home confinement is a nice feature to ensure your coverage stays in force if you become chronically ill.

While the AARP whole life policy does build cash value, it will not receive a dividend.

If you want a whole policy with a dividend, we would suggest reading our Foresters Life Insurance Review for one of the best participating whole life policies today.

When we compare the top whole life insurance rates at our agency, AARP is not usually the lowest.

Simply put, you are paying more for the AARP brand name. If brand names are important to you, you can get a quality whole life policy from the Mutual of Omaha usually at less cost.

Sometimes, we see clients get up to a 25% discount by simply applying with a different life insurance company.

The underwriting for the AARP whole life policy can be tight at times.

Not only are you paying more for the AARP name, but the policy is more difficult to qualify for.  If you have pre-existing health conditions, there may be a better whole life insurance company out there.

The AARP whole life insurance can be purchased with no medical exam, which is good news.

Some Health Conditions that AARP Whole Life Hates:

  • Heart or circulatory surgeries within the last 2 years
  • Insulin-dependent diabetes
  • Diabetic complications like neuropathy
  • Rheumatoid arthritis
  • Lung issues like COPD

While AARP may pass on the conditions listed above, there are plenty of life insurance companies that will say yes without a death benefit waiting period.

Clearly, AARP isn’t quite a fan of offering life insurance with pre-existing medical conditions.

If you have been declined before by AARP, it is worth taking a look at other options. If you want to apply for AARP whole life, you can do so online or mail in a paper application.

AARP Guaranteed Acceptance Whole Life

AARP Guaranteed Acceptance Life Insurance provides up to $25,000 of permanent group life insurance to AARP members.

Your acceptance is guaranteed with no medical exam and no health questions.

AARP Guaranteed Acceptance Whole Life Features:

  • Up to $25,000 in Death Benefits
  • No health questions or medical exam
  • Guaranteed rates that will never go up
  • Lifetime coverage that you can never outlive
  • Guaranteed acceptance
  • Builds cash value

Since there is no medical underwriting, the AARP Guaranteed Acceptance whole life plan has limited benefits in the first two years.

During this 2-year period, your beneficiary receives 125% of your premiums paid returned for non-accidental deaths.

Accidental deaths receive full death benefits from day one.

AARP Guaranteed Acceptance Rates – Death Benefits $10,000*

Issue AgeMenWomen
50$45$38
55$51$44
60$60$52
65$71$63
70$85$76

*Please note that the rates above are for people that have not used any form of tobacco or nicotine in the last 12 months.

Tobacco and nicotine users will pay a higher rate. Residents of MT have different rates from those shown above.

Since there is a modified death benefit in the first two years of the AARP guaranteed acceptance whole life insurance plan, it is meant for people who cannot qualify for first-day coverage.

If you are in fair-to-excellent health, you should look at the different policy.

If you cannot qualify for traditional life insurance coverage, AARP members ages 50 to 80 and their spouse’s age 45 to 80 can apply for the guaranteed acceptance whole life insurance as an alternative as long as the product is approved in your state.

You can apply online or through the mail with a paper application if you are old school.

We would recommend comparing the rates of multiple companies to be sure that you are getting a good deal though.

AIG Life Insurance Company has a very competitive guaranteed issue whole life as does Gerber Life Insurance Company.

AARP Young Start Life Insurance

As an AARP member, you can purchase AARP life insurance for grandchildren and children under the age of 17.

You can give your child or grandchild up to $20,000 that they can keep for their entire lives when they get older.

AARP Young Start Life Insurance Features:

  • Up to $20,000 of death benefits
  • Lifetime coverage
  • Low monthly rates
  • No medical exam
  • Builds cash value over time

AARP Young Start Whole Life Rates*

Death BenefitsMonthly Rates
$10,000$5.00
$15,000$7.50
$20,000$10.00

*Please note that the rates above are for each insured child. Premiums are not guaranteed, but rates may only change if they are changed for all others in the same class of insureds under this group/individual policy.

These AARP Young Start rates are dirt cheap. By purchasing an individual policy for your grandchild, you are giving them a headstart on financial security. If something were to happen to them, there would be money available to take care of their final arrangements as well.

The application for AARP Young Start is straightforward.

You just need to answer 3 health questions in order to purchase your AARP life insurance on your grandchildren or children.

There is no medical exam required, and the application can be completed conveniently online or through the mail.

Final Thoughts: Is AARP Life Insurance Reliable?

It can take years for life insurance companies to build their brand into a household name.

When it comes to senior life insurance, it can be tough to compete with the name recognition that AARP has.

When you combine that with the financial strength of New York Life, AARP life insurance can be considered very reliable.

However, AARP’s life insurance coverage is only as good as New York Life’s rates.

In our experience, AARP life insurance rates for seniors can be pricey. You are going to pay a premium for the AARP name.

Our agency always suggests you compare the rates of multiple life insurance companies before you make your decision.

Our life insurance agency looks at the rates of over 20 top-rated life insurance companies before we present a company to a client.

Life insurance companies have different opinions on underwriting and pricing.

If you have a pre-existing health condition, working with a broker who understands how life insurance companies underwrite.

FILED UNDER – LIFE INSURANCE COMPANY REVIEWS

Resources: AARPAOL