Is Nationwide really on your side? The short answer…maybe. Nationwide is a great company, but they are not everything to everyone. This Nationwide life insurance review will cover Nationwide’s ratings, their long history, and focus on their life insurance products.
We review hundreds of life insurance companies so we know what separates the best. If you are considering a Nationwide life insurance application, you need to read this review first.
Nationwide Life Insurance Company History
Over the past 94 years, Nationwide has grown from a small mutual automobile insurer to one of the largest the multiline and financial services companies in the world with greater than $158 billion in assets.
The Nationwide Insurance Company was founded in 1925 by Murray D. Lincoln as the Farm Bureau Mutual Automobile Insurance Company in Ohio. The goal was simply to provide quality automobile insurance at low rates to the farming community in Ohio. By 1943, Farm Bureau Mutual operates in 12 states and the District of Columbia.
As the Farm Bureau Mutual expanded operations westward, the company had to accept the reality that they had outgrown beyond their humble beginnings and original mission. Subsequently, the company changed its name to Nationwide Insurance in 1955.
Today, Nationwide is still owned by policyholders, but they offer a wider range of products and services than just automobile insurance to Ohio Farmers. Nationwide is a Fortune 100 company that provides property and casualty insurance, life and health insurance, annuities, mortgages, investments, and other financial services.
The Nationwide Insurance Company Rating
Nationwide’s balance sheet is iron-clad. Nationwide is rated an “A+” (Excellent) by A.M. Best. A+ is one of the best marks a life insurance company can received from A.M. Best and is considered an investment grade rating. Nationwide has an excellent financial balance sheet with a high likelihood of being able to meet their ongoing client obligations.
Standard & Poor’s also gave Nationwide rated as A+, which also suggests that Nationwide has low credit risk. The Nationwide Comdex score is 91. The Comdex is a composite score of the combined ratings of the main life insurance rating organizations like A.M. Best. Nationwide’s comdex scores is greater than 91% of all other Comdex-ranked life insurance companies.
Nationwide Credit Rating Snapshot
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Nationwide has been accredited by the Better Business Bureau since 1955. Nationwide has an A+ rating with the BBB, which is the highest rating that the BBB gives out. A high BBB rating indicates that Nationwide delivers quality products and service.
Nationwide Insurance Solutions
Nationwide offers term life, universal life, and whole life insurance. They also provide other financial services products, such as Nationwide property and casualty insurance, Nationwide annuities, investments, and Nationwide long-term care insurance. We’ll touch briefly on their other products, but the majority of content will revolve around Nationwide’s life insurance products.
Nationwide Term Life Insurance
Term life insurance is designed for temporary needs. The mortgage will eventually be paid off one day. You will one day retire from the workforce…hopefully. However, until those days come, it is wise to have life insurance coverage in place to protect your family if you die prematurely along the way.
Nationwide issues term life insurance in 10-year, 15-year, 20-year, and 30-year term periods. During your term period, the life insurance company cannot raise the monthly premiums on you as an individual.
Nationwide’s term life insurance includes a conversion option that allows you to trade your term life insurance policy with a permanent life insurance policy regardless of if you qualify for life insurance or not! It is not unusual for people to want coverage past their selected term periods. In fact, we see it a lot. Nationwide’s conversion option ensures at least your guaranteed an option when the time comes.
Nationwide’s term life insurance policies are fully-underwritten. In order to qualify for the coverage, you have to take a medical exam and Nationwide may order your medical records. There are companies that offer life insurance without the hassle of a medical exam. If that interests you, we would recommend looking at our Sagicor Life Insurance Review for a company that specializes in no-exam life insurance underwriting.
Nationwide term life insurance currently offers a number of optional riders that can be added on to the policy for additional premiums. Also, Nationwide includes a built-in accelerated death benefit rider for terminal illness at no additional cost to their term policies. As far as living benefits go, there are better options out there. We suggest checking out our Phoenix Life Insurance Review for a company that specializes in living benefits.
Nationwide Term Life Insurance Riders:
Nationwide Whole Life Insurance
Whole life insurance is the oldest type of permanent life insurance. Whole life insurance used to be the only type of life insurance available, but we mainly see it used for final expenses or estate planning situations due to its level premiums, cash accumulation and lifetime guarantees.
Whole life has guaranteed cash accumulation, premiums, and death benefits. As cash builds up inside your whole life policy it can be accessed through tax-advantaged loans for any reason whatsoever.
Some whole life policies may also receive non-guaranteed dividend payments, but Nationwide’s whole life insurance currently do not as of the writing of this article. Check out of Foresters Financial Life Insurance Review for one of the top participating whole life contracts on the market today if you are looking for a dividend with your whole life policy!
Policy dividends can be used in the following ways:
Nationwide offers a 20-pay whole life insurance policy that can be paid-up in 20 years and a traditional whole life insurance policy that you pay premiums for in perpetuity. Furthermore, Nationwide offers a simplified whole life product with no medical exam and a graded death benefit designed for final expenses and burial insurance.
Nationwide Universal Life
Nationwide also offers universal life policies, which are relatively new forms of permanent life insurance when compared to whole life. Universal life insurance can be structured to achieve different goals making them rather versatile.
However, Universal life insurance usually include less guarantees than whole life insurance. With whole life, the life insurance company assumes the investment risk. In universal life, the policyholder retains the investment risk of the cash value. We recommend periodically reviewing your universal life policy with your agent to ensure it is in good health.
Nationwide offers the following types of universal life insurance:
Nationwide Universal Life Insurance
Nationwide offers a traditional universal life insurance policy. These types of policies are rarer these days, but some people still purchase them. Since the interest rates your cash value receives changes like your bank account, we anticipate that they will become more competitive with indexed universal life as rates rise over time.
Nationwide’s universal life insurance policy offers exceptional flexibility. It has flexible premium payments, and policy cash values. Although, you can buy a secondary guarantee to prevent lapse for additional premiums if you want greater security. These no-lapse guarantee universal life insurance policies can be the most cost-effective way to achieve lifetime death benefits, but usually, have little or no cash value accumulation.
Nationwide Indexed Universal Life Insurance
Indexed universal life insurance works similarly to universal life insurance. The main difference is how the cash value is invested within the policy. Nationwide’s indexed universal life insurance policy provides death benefit protection and invests the cash value in an index strategy rather than a fixed interest account like traditional universal life.
The cash value in an indexed strategy that follows an index like the S&P 500. Since your cash value is not directly invested in the index, your investment principal is protected from investment loss if the index declines. However, the index strategy’s return is often capped and usually will not include index dividends in the return calculations.
Since index universal life usually does not have lifetime guarantees, they need be monitored on a regular basis. If the indexed investment strategy doesn’t generate enough interest, the policy could potentially lapse if the premiums are not increased.
Nationwide Variable Universal Life Insurance
Variable universal life insurance offers people lifetime life insurance protection with the ability to generate cash value potentially with investment market return. You can choose among various sub-accounts that follow different investment strategies ranging such as actively managed equity strategies.
Please note that your cash value is directly invested within whichever sub-account investment strategy you choose. Your cash value can go up or down depending on how that strategy performs and you can lose money if the sub-account performs poorly.
Due to the complexity of variable policies, the policy should be carefully considered before you move forward with your purchase. If you do decide to purchase a variable life insurance policy, be sure to frequently monitor your investment sub-accounts to be sure that the policy is healthy and not in danger of lapse.
Survivorship Universal Life Insurance
Survivorship life insurance, also known as joint-life policies, is a niche product that is usually used in estate planning strategies. These second-to-die policies cover two lives at one time. After the death of the second insured, the life insurance policy pays the death benefit to your heirs!
Second-to-die policies come in handy for families that need to leave a liquid estate; for example, to care for a special-needs child. Survivorship policies are also great for people who have illiquid estates with a majority of the family wealth in hard assets like rental properties, farmland, or family businesses who want liquidity to pay estate and inheritance taxes.
The Nationwide survivorship life insurance policy allows the potential for cash accumulation with either indexed strategies, a fixed interest account, or variable subaccounts. Index strategies are an alternative for people who want to limit their equity exposure due to its downside protection of principal.
The cash value allows additional flexibilities. If plans change later in life, you can access the cash value within the policies through withdrawals and tax-advantaged loans. This gives the policy the flexibility to be used as a source of income. However, these policies should be monitored to ensure that they are funded adequately. If the investment strategy underperforms, the policy could potentially lapse unless you purchase a secondary lifetime guarantee within the policy.
How Do Nationwide Agents Work With their Customers?
Nationwide has evolved since its founding into more than just life insurance. Nationwide’s life insurance products are usually sold by their career agents but can be sold by independent brokers. These Nationwide agencies typically are focused on property and casualty insurance but will offer Nationwide life and health products to their customers as well.
This approach to doing business may suit people looking for a more comprehensive service that bundles all their insurance lines together. However, this approach does have some drawbacks. A property and casualty agent who is more of a life insurance generalist may not have the broader industry expertise than an independent life insurance broker who specializes in life insurance specifically.
Besides, career agencies have been under the microscope recently due to perceived conflicts of interest. The concern is that career agents may be incentivized to offer higher-margin proprietary products when another company or product was a better recommendation for you. This type of business model is great for insurance companies, but is it really great for you?
Anyone who just needs life insurance is better served working with an independent broker who understands the life insurance landscape. Independent brokers don’t work for any insurance company so you do not have to worry about them “pushing company product.”
Nationwide does not publicly display their rates so you need to contact a Nationwide agent or broker in order to get a quote. Nevertheless, we advise that you compare the rates of multiple life insurance companies before you make a final decision. This will give you the knowledge you need to make an educated decision.
Requesting quotes from multiple companies does not negatively affect you and it greatly increases your chances of getting the best deal you can. Give one of our veteran agents a call or request a free no-obligation quote on our website. A simple phone call could potentially save you thousands of dollars on your life insurance.
The Nationwide Insurance Company phone number is 1-(877)-669-6877, or you can visit them on the web at the Nationwide website to request a quote.
The Final Word: Is Nationwide a Good Life Insurance Company?
Some people like the simplicity of having a multiline insurance agent A Nationwide agent can offer you a blend of home, automobile, and life insurance solutions in a single agency. The problem with bundling is that while it may be more convenient, it often can cost you more and reduces flexibility in the future if you change brands for your home and auto.
While Nationwide is great company, they are not always the best life insurance option available for you. Since Nationwide agents often work for Nationwide, that may cause a conflict of interest to present Nationwide insurance instead of shopping the market. If you have a pre-existing condition, want a bargain, or the simplicity no-exam underwriting, Nationwide might not cut the mustard.
That being said, you don’t succeed in business for over 100 years if you are not serving your policyholders. Nationwide offers life insurance, long-term care insurance, annuities, and investment services to their clients. Overall, Nationwide’s life insurance is a reliable life insurance company with strengths in certain areas of the market but there might be better out there.
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.