Illinois Mutual Life Insurance – The Inside Scoop

illinois mutual life insurance review

If you are reading our Illinois Mutual life insurance review, then you have discovered that there are a ton of life insurance companies doing business in the United States today.  This can be overwhelming to the everyday person with little knowledge of the life insurance industry.

Clients often come to our agency with similar and legitimate concerns.  They want to be confident that whatever company they choose will be around when the time comes and deliver the goods so to speak.

What our agency does is take the leg work of researching thousands of life insurance companies off of your plate. We have narrowed down a core list of the best life insurance companies operating today in our experience as life insurance veterans.

Now just because a company did not make our short list of core carriers does not mean they are a poor company. In order to earn shelf spots in our life insurance agency, a life insurance company needs to bring something new to the table.

We ask, does this life insurance company have a unique feature that separates them from the pack? Are their life insurance rates crushing the competition? Do they offer an outstanding customer experience?  These features separate the average from excellent.

So Is Illinois Mutual outstanding? In our Illinois Mutual life insurance review, we will take a look at every aspect of Illinois Mutual life insurance.  We are looking at Illinois Mutual’s credit rating, their life insurance rates, and will take a deep dive into life insurance contracts.

Illinois Mutual Life Insurance History

Spoiler alert!  Illinois Mutual was founded in Peoria Illinois!  While Illinois Mutual does not win any awards for name creativity, they do have an impressive track record of serving their policyholders with quality life and disability insurance since 1910.  That is over 100 years of service!

In the past century, Illinois Mutual has grown from a regional life insurance company to a provider of reliable life insurance and disability insurance through independent agent channels nationwide!

Unlike other life insurance companies that have gone public in recent decades, Illinois Mutual is still owned by its policyholders in a mutual structure. The company prides itself on being a family run organization.  Current President Katie McCord Jenkins is the fifth generation of McCords to lead the company, which is impressive in today’s day and age.

With Illinois Mutual’s focus service to drive quality personal experiences, there is no wonder that they have been in business for so long. As long as they keep putting their customers first, we will not be surprised to see Illinois Mutual around as a big player in the life insurance and disability insurance markets for years to come.

Illinois Mutual Credit Ratings and Financial Strength

While a storied legacy and 100-year track record are comforting, what have you done for me lately? Luckily, Illinois Mutual is in great financial shape according to third-party rating agencies that asses life insurance companies with $1.4 billion in assets under management.

A.M. Best rated Illinois Mutual with an A- (Excellent) in 2016 with an outlook of Stable. This A- rating affirms that Illinois Mutual is financially strong and can be viewed as being capable of meeting their financial obligations to their policyholders with high confidence.

Additionally, Illinois Mutual is an accredited business of the Better Business Bureau since 1943.  Illinois Mutual’s BBB rating is A+, which is the best opinion you can get from the BBB.

Illinois Mutual Life Insurance

One of the things about Illinois Mutual’s life insurance that struck me as an agent was their simplicity. Illinois Mutual offers four different life insurance contracts currently that are straightforward and easy to understand as a consumer.

Illinois Mutual Life Insurance Policies:

  • Whole Life Insurance
  • Term Life Insurance
  • Return-of-Premium Term Life Insurance
  • Final Expense Whole Life Insurance

Illinois Mutual Participating Whole Life

Illinois Mutual Whole life is the original life insurance that, as the name implies, lasts for your whole life.  People who are interested in whole life, tend to like the guaranteed nature of the product.

Whole life guarantees that your monthly premiums will never increase, that you will never outlive your death benefits and that your policy will accumulate cash value every year. The cash value grows inside the policy on a tax-deferred basis and can be accessed through tax-free loans if you need cash quick.

Illinois Mutual’s whole life insurance is also a participating policy, which means that it is eligible to receive dividend payments depending on the profitability of the life insurance company.  The dividend is what makes cash value accumulation attractive in a whole life policy.  However, dividends are not guaranteed, and payable at the discretion of the life insurance company.

One standout feature of Illinois Mutual whole life insurance is that they are one of the few companies that allow you to choose from 5 payment plans, including a rare single premium whole life option.

Illinois Mutual Whole Life Payment Options:

  • Single Pay Whole Life - Your policy is fully paid up in one single payment
  • 10-Pay Whole Life - Your policy is paid up after 10 years of payments
  • 20-Pay Whole LIfe - Your policy is paid up after 20 years of payments
  • Whole Life To Age 65 Pay - Your policy is fully paid up at age 65
  • Continuous Pay Whole Life - you pay lifetime premiums

Illinois Mutual has a built-in rider for chronic and terminal illness for no additional monthly premium cost.  For a freebie, Illinois Mutual’s living benefits rider is pretty good.  Most companies will only include terminal illness in their living benefits rider, but Illinois Mutual adds chronic illness as well (chronic illness is when you cannot perform two or more daily activities of living).

However, while Illinois Mutual does have an above average living benefits rider, there are better living benefit riders available on whole life that include critical illness as well.  We’d recommend you read our Foresters Life Insurance Review to learn more if living benefit whole life insurance interests you.

Outside of the built-in living benefits rider, you can add on optional riders to further customize your whole life policy. The level term insurance rider provides additional term life insurance protection that can be on yourself or even your spouse or your children.  Having one policy to keep track of is simplicity in its finest.

Mutual also allows you to add on a paid-up insurance rider that allows you to buy additional paid-up life insurance in addition to your primary death benefit.  This feature can not only increase your death benefit protection but can also amplify your cash value growth by increasing your dividend potential.

Illinois Mutual Term Life Insurance

Term insurance has grown in popularity as rates have fallen over the years.  Term life insurance is so affordable these days that there really is no excuse to carry some protection if you are in fair-to-excellent health.

Term life insurance was designed to protect a segment of your life, for example, while your kids are young.  Since you are usually purchasing insurance during your younger healthier years, this significantly reduces the cost compared to whole life. This makes term life insurance a great solution for replacing lost wages of the income earner or paying off the bank, so your family owns your home free of debt.

Illinois Mutual offers your run of the mill term periods.  In addition, Illinois Mutual allows you to purchase term life insurance to age 65 or age 70.  In our experience, some younger clients like the option of locking in coverage until age 65 or 70.  It is one policy that covers your entire working career

Illinois Mutual does include a conversion privilege within their term life insurance policies.  You can exchange your policy for a permanent policy within the selected term, before age 70, or before the 20th policy year, whichever is earliest.  As far as term conversions go, this is a good option but not outstanding.

Illinois Mutual also includes an accelerated death benefit rider for a terminal illness for free within the policy.  If you are diagnosed as terminally ill, you can forward 75% of your death benefits up to $500,000.  Terminal illness riders a pretty standard these days.  However, living benefits term life insurance with critical and chronic illness riders take accelerated death benefits riders to that next level.

For an additional premium, you can also augment your term policy with these riders:

  • Accidental death insurance
  • Disability waiver of premiums
  • Children’s term rider
  • Other insured term rider

Again, Illinois Mutual is focused on simplicity and flexibility.  Having your entire family covered under once policy is convenient. We usually recommend having individual term life insurance policies on adults when possible, but some client rather just have one. It is one bill, one policy, and one less thing to worry about.

Illinois Mutual offers accelerated underwriting for death benefits under $250,000.  At the underwriter’s discretion, Illinois Mutual could potential waive the paramedical exam for qualified applicants.

Our agency personal view on accelerated underwriting is that it is fantastic when the stars align, but it is too unpredictable. If you are adamant about purchasing life insurance without taking a paramedical exam, we would suggest applying with a company like Sagicor Life Insurance that specializes in no-exam life insurance.

Illinois Mutual Return-of-premium Term Life Insurance

Return-of-premium (ROP) term life insurance is a niche product for sure, but we do feel it is worth it in certain situations.  The attraction of a return-or-premium life insurance policy is that you get temporary death benefit protection and you receive all the money that you paid in the policy back at the end if you never need to use it.

This structure works well in a situation where you are either forced into purchasing life insurance, for example, a divorce decree.  ROP also works well for the person who knows they should have life insurance but hates the idea that if they do not use the coverage they lose all their premiums.

Situations Where ROP Makes Sense:

Return-of-premium term life insurance is priced higher than you would pay for a non-ROP term contract, but ROP term life insurance is more affordable than whole life insurance.  Occasionally, people will inquire about the rate of return of ROP life insurance.  That is dependent upon what you compare it to.

You could buy a non-ROP term policy and invest the premium difference on your own.  However, while “buy term and invest the difference” may look good on paper, very few people actually do it at all, let alone well, in our experience.  We see “buy term and spend the difference” more often than not.  Purchasing a return-of-premium term life insurance, or any cash value life insurance really, essentially forces you to save and guarantees the money will be there at the end of the ROP term.

Illinois Mutual Final Expense Whole Life

The average cost of burial and final expenses in the United States today is over $7,000 and the average American lives paycheck-to-paycheck.  Think about that for a second.  If something were to happen to you, how would your family take care of your final expenses?

Illinois Mutual’s final expense insurance offers a simple lifetime solution to cover your burial expenses and more.  These whole life policies are designed to provide cash quick to cover your final expenses when that day ultimately comes.

You can use final expense insurance to pay:

  • Funeral expenses
  • Probate fees
  • Remaining debt
  • Outstanding medical bills
  • Support your grandchildren's education
  • Charitable giving

Illinois Mutual has two levels of final expenses coverage (level and modified death benefits). The level death benefit provides you with full death benefit protection immediately that is guaranteed never to decrease for the rest of your life.

The modified death benefit pays full death benefits for accidental death on day one of the policy.  For non-accidental deaths, the death benefit is a return of premiums paid and 5% interest during the first 24 months. After that, the full death benefit is payable for both accidental and non-accidental deaths.

Illinois Mutual’s final expense whole life insurance underwriting is simple and easy.  There is no medical exam required, just a few health questions and you will know if you are eligible for coverage.  Once approved, your premiums will never go up, and your death benefit can never go down for the rest of your life.

Illinois Mutual Disability Insurance and Other Products

In addition to Illinois Mutual’s life insurance offerings, Illinois Mutual also provides disability, critical illness and other worksite insurance solutions for their policyholders.

Illinois Mutual Disability Insurance

Illinois Mutual has two different types of disability insurance solutions for their policyholders (Personal Paycheck Power and Business Expense Power).

Personal Paycheck Power is designed to replace a portion of your personal income if you become disabled according to the language of the policy.  This long-term disability insurance solution is one of the better plans on the market today especially for “blue collar” professionals.

Business Paycheck Power protects your business’s income rather than your personal income.  If you become disabled, Illinois Mutual business overhead policy will provide a cash infusion to maintain your overhead expenses while you get back on your feet.

Illinois Mutual Worksite Insurance offers voluntary benefits that can assist in attracting and retaining talented workers.  By having voluntary worksite insurance in place, it can help reduce employee turnover and boost employee morale.

Illinois Mutual worksite insurance supplements include:

  • Accident Insurance
  • Critical Illness Insurance
  • Short Term Disability Insurance
  • Worksite Term Life Insurance

The Final Word: Is Illinois Mutual Life Insurance Legit?

Illinois Mutual is the real deal.  They have a lengthy track record of providing quality life insurance to their policyholders for over a century.  Life insurance can be confusing to people at times, but Illinois Mutual’s life insurance is as straightforward as they come with affordable term life and whole life solutions.

 If you already have one of Illinois Mutual’s worksite insurance or Illinois Mutual’s disability insurance, then bundling your life insurance together at the same company may make sense from a simplicity standpoint as long as you are OK going through full underwriting.

If you are looking for non-medical underwriting, then other life insurance companies would likely be a better fit for you.  Additionally, many express issue life insurance includes built-in critical and chronic illness protections on top of waiving the medical exam. This provides you with a more robust life insurance coverage than your everyday vanilla term life or whole life policy.

Finally, every life insurance company has different views on how to underwrite your health and lifestyle. If you are searching for life insurance with a pre-existing medical condition, working with a veteran independent life insurance agent can literally save you thousands of dollars.

Joseph Cirillo of Good Life Protection

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.