Over time, life insurance companies, such as Allianz, have developed that specialize in the creation of life insurance products designed to optimize cash value growth while providing valuable death benefit protection.
Life insurance over the years has evolved. While life insurance is an insurance product that provides death benefit protection to your loved ones, it can all be an asset due to its cash value accumulation potential.
Our Allianz life insurance review will cover Allianz’s universal life insurance contracts in great detail to see if they fit into your asset allocation. Structuring life insurance to accumulate cash value can be a big dollar commitment. You need to read our review before moving forward.
Shall we begin?
Allianz Life Insurance History
The Allianz Life Insurance Company of North America was founded in 1896 by Henry Little in Minneapolis, Minnesota as the North American Casualty company.
In 1912, North American Casualty merged with the North American Life Association to become the North American Life and Casualty (NALAC). NALAC operated for 67 years until it was acquired by Allianz AG of Munich, Germany.
This merger created the Allianz Group, now one of the world’s largest financial services organizations. In 1993, Allianz’s North American operations simply became known as Allianz Life and the Allianz Life of NY.
Allianz Life Ratings and Financial Strength
Since 1896, Allianz has had the financial strength and stability to meet their commitments to their policyholders. Over 115 years, Allianz has weathered economic depressions, world war, and other crises never skipping a beat due to their conservative investing philosophy.
Allianz seeks long-term results that you can rely on. Practices such as diversification and risk management strategies have resulted in Allianz’s rock-solid balance sheet, which is backed up by third-party rating agencies.
The A.M. Best Company rates Allianz as an A+ (Superior), which is one of A.M. Best’s top ratings. Moody’s and Standard & Poor’s have issued a-ratings as well indicating that Allianz’s finances are in good order.
|A.M. Best||Moody's||Standard & Poor's||BBB|
AA (Very Strong)
Allianz Life has been accredited by the Better Business Bureau (BBB) since 1972 and currently holds the BBB Rating of A+, which is the BBB’s highest award. No business is perfect, but Allianz does its best to do right by its policyholders.
Allianz Life Insurance Solutions
Allianz Life has a small but targeted menu of life insurance options. Allianz is one of the premier index universal life insurance (IUL) companies on the market today and considered a leader in index strategies by many life agents.
Allianz Index Universal Life Insurance
Index universal life insurance is a form of permanent life insurance. Index universal life insurance is similar to whole life insurance in the sense that it has lifetime death benefit protection and grows cash value.
However, index universal life is usually more affordable and flexible compared to whole life. Universal life insurance allows you to pick your funding level for your life insurance coverage.
If you run into a tight spot financially, you can even suspend your payments as long as the policy has adequate funding to continue.
While this flexibility is a great feature, you should regularly monitor the health of your universal life insurance. If you underfund the policy, it may not have enough cash built up to pay the insurance charges and the policy could lapse.
Allianz Index Universal Life Insurance Options:
Index universal life insurance invests a portion of your in an index strategy. Index strategies credit your account interest based on the performance of an external market index. Said in plain English, your money is not directly invested in the index.
If the index goes up, your account is credited with a portion of the index growth. If the index goes down, your principal is safe and secure. You cannot lose money due to poor investment performance.
Allianz Index Strategy Options:
The cash value will grow tax-deferred within the indexed universal life policy. If you want to access your cash value, you can take tax-advantaged withdrawals or loans that are backed by your death benefit.
Allianz’s index universal life insurance policy also offers three different types of death benefits. You can have a level death benefit or an increasing death benefit. If you choose the increasing death benefit, you can switch to level if you want.
Allianz Life Pro+ Death Benefit Options:
The amount of death benefit coverage remains constant throughout the policy
The death benefit increases as your cash value increases within the policy
The death benefit increases by the amount of your paid premiums.
Allianz also has an interesting feature that allows your beneficiary to received a 10% death benefit increase if they take their proceeds over a 10-year period or longer. This feature could be useful in income replacement scenarios, especially if they need reliable and secure income.
Allianz also offers a joint-life indexed universal life insurance policy that covers two lives. These second-to-die universal life insurance policies pay the death benefits after the death of the second insured.
We usually use joint-life index universal life insurance to generate a liquid estate upon death due to the tax advantages of life insurance death benefits to pay estate taxes, leave funds for a child who needs financial support or leave your grandchildren money for college.
Allianz is on the cutting edge of index universal life insurance, but their underwriting is thorough. You may need to take a medical exam in order to qualify for the coverage, and the underwriter may order your medical records.
There are other no-exam life insurance companies that offer coverage with no medical exam for index universal life insurance, such as Sagicor Life. While Allianz does offer an accelerated underwriting process that may potentially waive the medical exam, it is still labor intensive.
After you apply for your Allianz life insurance, you will need to complete a personal health interview over the phone. After your phone interview, Allianz will determine if they can issue or if you need to take the exam.
If you hate needles or do not have the time to take an exam, take a look at our best no-exam life insurance companies list for the leaders in non-medical underwriting. We see more people get covered when they qualify for no-exam life insurance.
Allianz does, however, offer living benefits on their indexed universal life insurance for chronic and terminal illnesses. As far as living benefits IUL is concerned, there are more robust options, like Ameritas Life, that include critical illness on their products.
Additional Allianz Index Universal Life Insurance Optional Riders:
Allianz Term Life Insurance
Allianz is a leader in index universal life insurance, but their life insurance options had a big gaping hole on the term side. IUL is great for cash accumulation or lifelong insurance needs, but term life insurance is a better option for temporary needs like mortgage protection.
Rather than reinvent the wheel, Allianz reached out to Legal and General who underwrites Banner and William Penn Life Insurance. Banner has some of the most competitive term life insurance rates in the industry right now. Thus, Allianz Term Pro+ was born.
Allianz term life insurance comes in durations of 10, 15, 20, 25, and 30-year term durations with death benefits ranging from $100,000-$5,000,000. The policy also includes an accelerated death benefit rider within the base policy for terminal illness.
One of the best features of the Allianz Term Pro+ contract is the exchange feature. The exchange feature allows you to exchange all or a portion of your term policy with any of the Allianz permanent life insurance policies that are made available for exchange.
An exchange can take place in policy years 2-5 without requalifying through medical underwriting. Since Allianz has some of the best indexed universal life insurance on the market, this is a huge benefit that offers you great flexibility if your needs change during your term.
Allianz Life Insurance Rates
We have included some sample monthly rates of Allianz term life insurance to give you a ballpark idea of their affordability. Please note that you need to qualify for these rates based on your health, lifestyle, and other factors.
Sample Allianz Term Life Insurance Quote: Term (Age 45)
|Death Benefit||Male 10-year||Male 20-year||Female 10-year||Female 20-year|
Please note that these Allianz Life Insurance term quotes are for the preferred best non-tobacco health class.
Allianz term rates are competitive with many of the top term life insurance companies, but they are not the rock-bottom lowest price. If you simply want affordable and convenient term life, you might want to compare other options. Allianz’s exchange program is worth factoring in though.
Allianz Annuity Solutions
Allianz’s indexing strategy experience does not stop with just universal life insurance. Allianz has taken all that knowledge and applied it on the annuity side of the business.
While life insurance usually pays your loved ones a guaranteed lump sum when you die, an annuity pays you a guaranteed income stream if you live a long life similar to a pension.
Annuities usually have an accumulation phase where your assets grow tax-deferred, and a distribution phase where you withdraw income. Once you take money out of the annuity, you may have to pay tax on your gains.
Like indexed universal life insurance, indexed annuities protect your principal from investment loss. If you are approaching retirement and want to reduce or eliminate the risk of principal loss.
Allianz indexed annuity strategies work similarly to the Allianz indexed universal life insurance. Your principal is not directly invested in the market, so your investment principal is shielded from investment loss. However, your upside in the index strategy is limited by a cap that can change.
Annuities can be complex insurance contracts and are securities in the case of variable annuities. You should carefully consider the features of an annuity contract before making a purchase to make sure that it suits your goals and objectives.
Final Thoughts: Is Allianz Life Insurance Worth It?
Allianz is a unique life insurance company that’s index universal life insurance products focus on cash accumulation and principal protection.
If you are looking for lifetime death benefit protection with the potential for tax-advantaged cash value accumulation, Allianz will likely be a top consideration. Allianz IUL cash value can be used for supplemental retirement income, education expenses, or other purchases.
While Allianz does offer term life insurance, its index universal life insurance is their bread and butter product. If you are looking for term life insurance to cover temporary needs like income replacement, then Allianz may not be the right company for you.
Every life insurance company has different opinions on rates and underwriting. Regardless, of what you want your life insurance to do for you, we suggest comparing the rates of multiple insurance companies in order to find the best value for your unique situation.
FILED UNDER – INSURANCE COMPANY REVIEWS
RESOURCES – Allianz
Joe is a lifelong learner with a passion for sharing what he has learned with others. Joe has publicly spoken on life insurance in the past to both colleagues at industry conferences and to consumers in educational settings and as a contributor to industry blogs. Additionally, Joe is studying for certifications such as the CFP, CLU, and RICP to further his professional knowledge.