This New York Life insurance review will give you all the details that you need if you are considering New York Life insurance to protect your family. We will cover New York Life’s ratings downgrade, history, and life insurance products.
There are hundreds of life insurance companies operating in the United States, but is New York Life the right one for you? If you are considering purchasing life insurance with New York Life, do not move forward without reading this review.
New York Life Insurance Company History
The New York Life Insurance Company was founded in 1845 as the Nautilus Insurance in an office on 57 Wall Street New York, NY. Shortly after in 1849 the company was rebranded as the New York Life we know of today. New York Life grew rapidly. By 1846, New York Life’s assets under management exceeded $1 million.
During the Civil War, New York Life stood firm that they would honor legitimate death claims from both the Union and Confederate states. Throughout the war, New York Life kept its promises to its policyholders even if it meant crossing battle lines under a white flag of truce to do so.
In 1906, a disastrous earthquake and fire leveled much of San Francisco. Three resourceful New York Life agents had the foresight to bury their files in Golden Gate Park. A few days afterward, the agents set up a temporary office to generate lend policy loans and pay out death claims to policyholders.
By 1923, New York Life’s assets surpassed $1 billion. The Great Depression hit the financial industry hard but not New York Life. While other financial institutions were closing, New York Life remained open for business honoring its promises to its policyholders.
In 1959, New York Life celebrated its 50th anniversary. New York Life completed its mutualization and was now owned by its policyholders. New York Life, up to this point, had paid dividends to policyholders but 1959 marked the completion of the mutualization process.
Through the 60s, 70s, 80s, and 90s, New York Life experienced steady growth. New York Life expanded its life insurance and investment product offerings as the industry innovated. By 1990, New York Life’s assets have surpassed $50 billion.
1995 was a big year for New York Life. It celebrated its 150th anniversary as a company in Madison Square Garden the world’s most famous arena. Also, mutual life insurance companies are included on the Fortune 500 list for the first time in history. New York Life ranks number 84.
In 1999, New York Life decided to remain a mutual life insurance company that is owned by its policyholders, not shareholders, during a time when many life insurance companies were demutualizing. New York Life’s Board of Directors releases a statement saying that they want to run the company with a focus on long-term success for policyholders, not a short-term outlook to satisfy equity markets.
After September 11th, New York Life announces that the will waive all war exclusions on their policies and were committed to paying out all claims swiftly and compassionately. Also, New York Life followed its long history of philanthropy by contributing $3 million to the 9/11 Fund and instituting a matching-gift program that matches contributions of New York Life employees, agents, and retirees to the American Red Cross Natural Disaster Relief Fund.
In 2002, New York Life become the largest mutual life insurance company in the United States. Even though the Great Recession of 2008, New York Life continues to grow with income annuity sales surpassing $1 billion in 2009.
Today, New York Life is a nationally recognized brand when it comes to life insurance with $10.6 billion in policy owner benefits and dividends paid in 2017. For over 170 years, New York Life has been keeping its promises to its policyholders through wars, pandemics, and financial crises never missing a dividend payments since 1854.
New York Life has grown to a whopping $586 billion in assets under management. Additionally, New York Life continues to remain focused on their mission to provide financial security and peace of mind to their policyholders.
The New York Life Insurance Company Rating
New York Life’s balance sheet is iron-clad. New York Life is rated an “A++” (Superior) by A.M. Best. A++ is an excellent rating. New York Life is considered investment grade and they received A.M. Best’s highest mark. New York Life can be viewed as being in excellent financial health with the ability to meet its ongoing life insurance obligations.
Standard & Poor’s has New York Life rated as AA+. Again, A rating is superb rating and investment grade. These ratings indicate that indicates that New York Life has low credit risk and the means to make good on their promises.
The New York Life Comdex score is 100, which is a composite score averaging the ratings of the major insurance rating organizations. New York Life score is higher than virtually every other insurance companies ranked on the Comdex scale.
New York Life Credit Rating Snapshot
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New York Life Insurance Company received temporary ratings downgrade by Standard and Poor’s to AA+ in 2011, which is still an elite rating. This move had little do do with New York Life’s company management and was more of a reflection of U.S. sovereign debt instability at the time since insurance companies are highly linked to government bonds. Today, domestic economic outlooks have stabilized, and New York Life has returned to the top ratings.
New York Life is not an accredited business with the Better Business Bureau, but this is not a huge concern. New York Life’s 100+ year track record speaks for itself. However, New York Life does hold the BBB’s highest rating of A+. Generally speaking, the public is satisfied with the services New York Life provides.
New York Life Insurance Solutions
New York Life offers various types of life insurance including term life, universal life, and whole life. New York LIfe also provide other financial services and products, such as New York Life annuities, investments, and New York Life long-term care insurance. Notwithstanding, our review covers predominantly on their life insurance products.
New York Life Term Life Insurance
Term life insurance the most cost-effective way to purchase temporary large death benefit amounts. Term insurance is a great solution for income replacement, mortgage protection, or providing higher education resources if you pass away prematurely.
New York Life offers term life insurance in 10-year, 15-year, and 20-year term options. Your monthly premium is locked in for the term period you select. Additionally, there is no savings component or cash value associated with term insurance.
New York Life’s term life insurance contracts include a built-in conversion option. The
conversion option allows you to exchange your New York Life term life insurance policy with a permanent life insurance policy, for example whole life insurance, without having to provide evidence of insurability. This give you great flexibility if you want to maintain some life insurance coverage past your level-term period but either cannot or do not want to go through underwriting again.
New York Life also offers simplified term life insurance that can be purchased without the hassle of a medical exam up to $150,000 of death benefits depending on your age. However, one of the negatives of New York Life’s simplified term life insurance is that your premiums can increase every 5 years. Therefore, if you are considering no-exam life insurance, we would suggest looking at the best no-exam life insurance companies that specialize in this area of the life insurance market.
New York Life Whole Life Insurance
New York Life is well known for its participating whole life insurance. Participating whole life insurance pays non-guaranteed dividends to policyholders based on the performance of the company.
Whole life insurance is a type of permanent life insurance. We view whole life insurance as a great option for permanent life insurance needs such as final expenses and burial costs or in estate planning cases where you want both strong guarantees and cash value accumulation since whole life insurance provides the most guarantees of any life insurance policy currently.
Whole life contractually guarantees cash accumulation, level lifetime premiums, and permanent death benefits. The cash value within the whole life policy can also be accessed through tax-advantaged loans that are secured by the death benefit of the policy. Some policies, like New York Life’s whole life policy, may receive non-guaranteed dividend payments as well.
Policy dividends can be used in the following ways:
One standout feature about New York Life’s whole life policy is that you can customize when you want to pay the policy off. You can choose how long you want to make payments, and your premiums are guaranteed never to change.
Also, New York Life offers a survivorship whole life insurance policy. Survivorship policies are also known as second-to-die life insurance or joint whole life insurance. Their purpose is to provide cash liquidity upon the death of the second insured and are usually used in estate planning.
New York Life Universal Life
New York Life also offers universal life policies, which is another type of permanent life insurance policy. Universal life insurance is all about flexibility. Unlike whole life, your monthly rate is flexible. You can choose the amount you want to pay per month or pay nothing at all. However, your decision will affect the performance of the policy.
Subsequently, these universal life insurance policies generally come with fewer guarantees than whole life insurance in exchange for the flexibility. The owner of the policy takes on the investment risk within the policy. If the policy is not funded properly, then you can lose your coverage.
Mutual life insurance companies are usually better known for their whole life products and public life insurance companies tend to have a great focus on their universal life insurance. If you are considering purchasing a universal life insurance, we suggest checking out our Sagicor Life Insurance Review. Sagicor has one of the best no-exam universal life insurance policies on the market today.
New York Life offers the following types of universal life insurance:
New York Life Universal Life Insurance
New York Life offers a traditional universal life insurance policy. These types of policies rarer in in recent years due to a low-interest-rate environment, but some companies still offer them. Universal life insurance has a fixed minimum interest rate, but the credited rate is not guaranteed. The credited interest rate can fluctuate higher or lower. Therefore, a universal life insurance policy should be monitored every couple years to ensure the policy is being funded appropriately.
Pro Tip: New York Life’s universal life insurance policy allows you to purchase a secondary guarantee to prevent lapse for an additional fee.
New York Life Indexed Universal Life Insurance
Indexed universal life insurance is another branch under the universal life insurance umbrella. New York Life’s indexed universal life insurance policy offers death benefit protection with the potential to grow cash value within a number of index account strategies or a competitive fixed rate account.
The cash value in an indexed strategy grows based on fluctuations in your selected index strategy such as the S&P 500. Since your cash value is not directly invested in the stock market \, your investment principal is protected from investment loss if the market crashes. However, your upside investment return will be limited too in an indexing strategy by a cap or percentage gain.
These types of policies should be reviewed regularly. If the indexed investment strategy under performs, the policy could potentially lapse.
New York Life Variable Universal Life Insurance
Variable universal life insurance provides lifelong life insurance protection with potential cash value growth through portfolio strategies in investment sub-accounts. Your cash value grows tax-deferred depending on the performance of the underlying equity, fixed income, or money market strategies in your chosen sub-account.
Although, your cash value is directly invested within whatever sub-account investment strategy you choose, unlike indexed universal life which is not directly invested in the market. So if you invest in a stock sub-account strategy and the stock market declines, your investment principal will lose value with it. However, if the stock market goes up, your cash value will rise with the market.
Variable life insurance policies should be thoroughly monitored and reviewed at least annually. If the investment strategy underperforms, the policy could potentially lapse due to underfunding unless you have a secondary guarantee.
How Do New York Life Agents Work With their Customers?
New York Life has evolved since its founding into more than just life insurance. New York Life’s life insurance products are usually sold by their financial professionals These New York Life financial professionals typically can sell securities, like mutual funds and variable annuities, in addition to traditional life insurance.
This approach to doing business may suit people looking for a more comprehensive service that includes investments and financial planning. However, it does have some drawbacks. A financial professional who is more of a generalist may not have the broader industry expertise than a broker who solely focuses on life insurance may have.
A large criticism of New York Life’s career model is the potential of conflicts of interest. Career agents can be incentivized or even restricted to offer certain proprietary products regardless of whether another company’s product was better for your family.
If you only want a life insurance policy, we would suggest working with an independent broker who specializes in life and health insurance. Independent brokers don’t work with any one insurance company. They work with insurance multiple insurance companies to find your family the best deal.
New York Life Rates
New York Life does not publicly display their rates. Therefore, you would need to contact a New York Life agent to get a New York Life quote relevant to your specific situation. Regardless, we always suggest that you compare the rates of multiple life insurance companies before you make your final decision.
Before you purchase a New York Life insurance policy, there is no harm in getting a second opinion. Give one of our independent agents a call or request a free no-obligation quote today. One phone call could potentially save you thousands of dollars on your life insurance.
The New York Life Insurance Company phone number is 1-(800)-225-5695, or you can visit them on the web at the New York Life website to request a quote.
The Final Word: Is New York Life Good or Bad?
Some like the ease of having a single financial professional that is a generalist. A New York Life agent can offer you a blend of retirement planning and insurance solutions in one consolidated person. New York Life has a long company history of serving their policyholders. If having a household name is important to you with an iron-clad balance sheet, New York Life is a top option.
However, while New York Life is great at a lot of things, they are not always the best solution out there. Since New York Life agents work for New York Life, that may cause a conflict of interest when they suggest what life insurance company to work with. Don’t be surprised if it is New York Life. If you have a pre-existing condition, want the best price, or are looking for no-exam underwriting, there may be better options 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.