Many insurance companies in the United States offer life insurance. However, there are only a select few life insurance companies that are elite. Our Erie life insurance review will elaborate on why Erie life insurance missed the cut of best life insurance companies.
Our agency is always looking for quality, affordable life insurance options for our clients. We look at things like affordable prices, reliable financial strengths, ease of purchase, and underwriting. While Erie offers good life insurance, it falls short of being great in our opinion. If you are considering purchasing life insurance with Erie Insurance, you need to read this before moving forward.
Erie Insurance Company History
While the Erie Insurance Company may not be a household name, they have been in the insurance business since 1925! The Erie Insurance Company’s two founders H.O. Hirt and O.G. Crawford founded the Erie Insurance Company like most entrepreneurs who strike out on their own; they were unhappy with their current job situation, and felt they could do it better!
By 1924, Erie’s founders resigned from the Pennsylvania Indemnity Exchange (PIE) and created a handwritten business plan to attract investors. In the time it takes to withstand one of Erie’s cold winters, the duo was able to raise the $31,000 that they needed to launch their company.
In 1925, the Erie Insurance Exchange was born with one of their first policies written on H.O.’s own Dodge! After all, no one trusts a cook who does not eat his own cooking! The company expanded throughout Pennsylvania, and by 1953, they grew outside of the Keystone state into Maryland.
As Erie expanded outside of Pennsylvania, it’s insurance lines began to grow as well. Erie introduced its first homeowners insurance policy in 1961. Erie was officially considered a multiline insurance company. The Erie Family Life Insurance Company was created in 1967, which marked Erie’s entrance into the life and health insurance arena.
Additionally, the Erie Insurance Company is part of the community of Erie, Pennsylvania. Chairman of the Board Tom Hagen has taken an active role in the revitalization of Erie’s historic neighborhoods and the restoration of homes and buildings earning him several awards for his work including Otto Haas award for outstanding individual achievement from the Pennsylvania Historic Preservation Society.
Today, the Erie Insurance Company is a publically traded company on the NASDAQ and has over $5,000 employees and $12,000 independent agents who represent Erie. Erie offers home, automobile, business insurance, as well as life and health products to their policyholders.
Erie Insurance Ratings and Financial Strength
Stable financial health is at the core of any insurance company. You want to know that when the time comes that the insurance company can pay the claim. The Erie Insurance Group delivers in this area.
The A.M. Best Company has rated the Erie Insurance Group as A+(Superior) and the Erie Family Life Insurance Company as A (Excellent); both of which are investment grade. These ratings indicate that both the Erie Family Life Insurance Company and its parent company the Erie Insurance Group have the financial means to make good on their promises.
Erie is also a Fortune 500 company and winner of multiple awards from J.D. Power and Associates for Auto Insurance Purchase Experience. The Erie Insurance Group is not accredited by the Better Business Bureau (BBB), but Erie did receive an A+ rating from the BBB
Erie Life Insurance Solutions
The Erie Insurance group offers multiline solutions from automobile insurance to business insurance. While Erie is likely more known in the property and casualty insurance space, our specialty is life insurance. Therefore, we will focus strictly on their life and health insurance products for the purposes of this review.
Erie Term Life Insurance
Erie offers two term life insurance plans, an easy-to-purchase option and a level term life insurance plan. Erie’s no-exam express issue option will allow you to purchase up to $90,000 of life insurance coverage by answering just a few medical questions. Otherwise, you need to complete full medical underwriting.
If you are interested in purchasing term life insurance with non-medical underwriting, there are plenty of no-exam term life insurance options out there that will allow you to purchase higher death benefit amounts up to $500,000 death benefits. Check out our Sagicor Life insurance review for one of the hottest no-exam term life insurance providers right now.
Erie offers term life insurance in 5, 10, 15, 20, or 30-year plans. One unique feature about Erie term life insurance is you can start the coverage at age 0. Not many life insurance companies will offer term life insurance coverage on children unless it is attached to an adult policy as a children’s term rider.
Erie also includes a term conversion in their term life insurance policies at no additional premiums. This conversion option allows you to convert your temporary term life insurance plan with a permanent whole life option regardless of your health and lifestyle.
Also, Erie’s term life insurance is pure death benefit protection for a premature death. Many life insurance companies are providing accelerated death benefit riders built into their term policies that allow you to take an advance on the death benefit for critical and chronic illness.
For example, life insurance companies like Phoenix Life offer great middle-market solutions with robust living benefits. It is a great policy that gives flexibility depending on what life throws at you.
Erie Whole Life Insurance
Erie offers whole life insurance as well to cover permanent life insurance needs. The most common permanent life insurance need is final expense insurance. A good burial policy will range between $5,000-$15,000 in most cases depending on how you want to be taken care of when you pass.
Whole life is ideal for final expenses because you cannot outlive your insurance, unlike term life insurance that is temporary. This ensures that the money is there when your family needs it the most.
Also, whole life insurance has level lifetime premiums that can never go up and guarantees cash value accumulation that grows tax-deferred. You can borrow against your policy through tax-free loans if you need cash while you are alive as well.
Some whole life policies, known as participating whole life, are eligible to receive a non-guaranteed dividend payment. The dividend is paid out of the insurance companies profits to the policyholder based on the companies annual performance and can be reinvested to grow the death benefit and increase the cash surrender value of the policy.
Participating whole life insurance is traditionally offered by mutual companies that are owned by their policyholders. However, the Erie Insurance Group is a public company that is owned by shareholders.
Erie’s whole life policies have similar underwriting requirements to its term life insurance. Erie’s whole life coverage under $90,000 of death benefits follows a simplified underwriting process. There are a few health questions, and no medical exam is required. You can receive a decision in as quick as 15 minutes!
Erie Universal Life Insurance
Erie also offers universal life insurance, which is a more flexible type of permanent life insurance coverage compared to whole life insurance. Universal life insurance is ideal of things like estate planning where whole life insurance can be costly and rigid.
Erie’s universal life insurance policy allows for payment flexibility. You also receive a guaranteed level of death benefit and a guaranteed interest rate. Your coverage can last your entire life, or you can reduce the coverage length as necessary.
Just like whole life insurance, your cash value will grow tax-deferred. You can also take loans against your policy that are tax-free. However, the cash growth within a universal life insurance policy is not guaranteed and subject to the fluctuations in the declared interest rate by Erie.
Generally, if you need a larger amount of coverage, $100,000 for example, universal life insurance can make sense due to the premium savings. For amounts under $90,000, we would probably stick with a whole life insurance plan for the guarantees and ease of the non-medical underwriting.
How to Apply for Erie Life Insurance
Erie life insurance sold through insurance professionals. These insurance professionals are generally independent insurance brokers who broker Erie insurance products so your local Erie insurance agents would be the best place to start.
You can request a life insurance quote from our website for a second opinion, but we do not broker Erie product. In our experience, there are more competitive rates with traditional life insurance companies out there, so there is really no need to bring on additional life insurance companies unless they are bringing something to the table that our core life carriers do not already offer.
You can request an Erie life insurance quote on the Erie insurance website as well, or call the Erie Insurance phone number 1-800-458-0811. However, these channels may just redirect you to your nearest Erie life insurance agent anyway.
Other Erie Lines of Insurance
Erie Insurance group is more well known for its personal lines automobile and homeowners coverage. Our niche is in life products specifically, but we will briefly list the other services that Erie Insurance Group provides to its policyholders.
Erie Insurance Group Insurance Services:
Final Thoughts: Is Erie Life Insurance Worth It?
Erie Life Insurance is indeed a viable option if you are looking to protect your family from the financial devastation of premature death. One of the advantages of working with Erie is that it is convenient to bundle all of your lines of insurance with one company. However, you may be paying a premium for this.
There are traditional life insurance companies that offer highly competitive term life insurance rates that are just more affordable than Erie’s term rates. This is especially true when it comes to non-medical underwriting. If you want to purchase term life insurance without a medical exam, there are plenty of better options available.
Additionally, if you have a pre-existing medical condition, other life insurance companies may be better equipped to underwrite your case more affordable. That is why you want to work with an independent broker who specializes in life insurance. A life insurance specialist will be able to direct you on what life insurance company will best fit your unique case.
It never hurts to get a second opinion. You can give one of our knowledgable agents a call or request a quote from our website. Our agents will pre-qualify you and present you with your top options. Ultimately, you make the final decision once you have all the facts.
FILED UNDER – LIFE INSURANCE COMPANY REVIEWS
Resources: Erie Insurance
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.