Our Take USAA offers a unique suite of benefits designed to meet the needs of those who serve in the military. In fact, of the 91 insurance companies we reviewed, it won top billing for best life insurance company for the military. In addition to military-specific perks, policies are backed by USAA’s A++ rating for financial stability and the company has received very few complaints. Notably, you don’t need to be in or affiliated with the military to qualify for USAA life insurance. Pros & Cons Pros A++ financial stability rating Very few customer complaints Guaranteed insurability available at no additional cost Injury benefits Any time conversion rider available Cons No-medical-exam policies are lacking Few policy types available Company Overview In 1922 USAA was founded when 25 Army officers wanted to insure each other’s vehicles. Since that modest start, this organization has grown to provide insurance to millions of members of the military community. The name USAA stands for United Services Automobile Association, and since 2009 USAA has been working with military affiliated groups to connect with veterans, military members, and their families about their financial products and services. USAA Life Insurance policies provide some valuable military-specific benefits at no additional cost to their members such as coverage during wartime, severe injury benefits, and the option to add coverage at a later date, without proving insurability (meaning, you don’t have to take a medical exam or answer questions about your health). Life insurance policyholders may also be eligible to receive dividends. specifications AM Best Rating A++ NAIC Score (avg.) N/A Years In Business 100 Years Policy Types Term, Universal (UL), Whole Accepts Credit Cards No Why Trust Us 91 Companies reviewed 55 Features considered 5,005 Data points analyzed We collected over 5,000 data points from 91 life insurance companies to measure financial stability, customer satisfaction, product and feature variety, and the overall buying experience. We then evaluated each company based on 55 metrics to develop unbiased, comprehensive reviews. Read our Full Methodology Table of Contents USAA Life Insurance Review Pros Explained Cons Explained Complaint Index Third-Party Ratings Competition Policies Available Available Riders Customer Service Price Is It Right for Me? Methodology The National Association of Insurance Commissioners (NAIC) tracks the complaints that insurance companies receive and uses the information to develop a complaint index. The NAIC complaint index is a measure of how many complaints a company has received relative to how many complaints it’s expected to receive based on its size. If a company has a complaint ratio over 1.0, that indicates that the insurance company receives more complaints than expected for a company of its size. If the company receives a ratio below 1.0, then it received fewer complaints than expected. USAA has a complaint index of 0.22 for 2021 which means it received far fewer complaints than expected. For comparison’s sake, Nationwide (0.263), New York Life (0.279), and State Farm (0.295) are all major insurance companies that also received fewer customer complaints than expected. USAA shines when it comes to being reliable financially (which is a key trait to look for when purchasing a life insurance policy that can last decades). It received an AM Best score of A++. Only nine of the 91 insurance companies we reviewed receive this score: USAA is in good company with New York Life, MassMutual, and State Farm. To understand how USAA stacks up to competitors of similar size, we compared it with two rivals based on six commonly searched policy features. Term Life Insurance is a type of temporary coverage that lasts a limited number of years, such as 30, and is more affordable than permanent life insurance. USAA offers both Level Term V and Essential Term (not available in Arizona, Florida, or New York) policies: If you are willing to undergo a more lengthy application process to save money on a USAA term policy, Level Term V is the way to go. Though you get to skip the exam with Essential Term, it’s only suitable for very short-term coverage since the cost increases every year and you can’t renew it once you turn 39. Unlike a term life insurance policy, whole life insurance lasts your whole life as long as you continue to pay the scheduled premiums. Your death benefit is guaranteed throughout the life of the policy and the policy builds a tax-deferred cash value. USAA also makes Mutual of Omaha’s Guaranteed Whole Life policy available to members, but does not underwrite this coverage itself. USAA doesn’t offer universal life insurance itself but makes John Hanco*ck’s universal life policies available to its members. A universal life insurance policy offers flexible but permanent coverage with a cash value that can last a lifetime if you pay sufficient premiums. Unlike whole life insurance, you can adjust or skip premium payments if needed without immediately causing the policy to lapse. Guaranteed insurability riders let you increase the death benefit without having to re-qualify for coverage—meaning you don’t have to answer health questions or take a medical exam. USAA offers two at no additional cost: You can attach USAA’s Term Life Insurance for Children Rider to your own policy and get up to $25,000 of coverage per child for all your children for $7.99/month. Once your child becomes an adult, they can convert the rider to permanent coverage that can last their entire life. For an additional cost, USAA offers a waiver of premium rider that lets you skip premium payments if you become disabled. USAA offers an accelerated death benefit rider for terminal illness at no additional cost. With a terminal illness rider, you can access a portion of your death benefit when diagnosed with a terminal illness to use for whatever you want while you’re still alive. You can connect with USAA over the phone or via mail. Their main phone hours are Monday to Friday, 7:30 a.m to 8:00 p.m CT. Phone Numbers Mailing Address To gain insight into life insurance pricing, we gathered quotes across a range of insurers for healthy males and females aged 25, 40, and 55 years old for 30-year $250,000 term policies. Based on this analysis, USAA’s term policies cost slightly more than average. However, that cost may be well worth it if USAA’s value-added features like guaranteed insurability and injury benefits are important to you. If you’re in the military, a USAA life insurance policy may serve your needs well. Active servicemembers might especially appreciate the no-cost military benefits, such as accelerated issues for servicemembers preparing to deploy, coverage during wartime, and severe injury benefits for injuries sustained in the line of duty. Even if you’re not in the military, USAA may still appeal. That the company offers guaranteed insurability riders at no additional cost is uncommon and valuable. Most life insurance companies charge extra to allow you to increase the death benefit later, but not USAA. But if you’re looking for long-term or high coverage no-medical-exam life insurance, you’ll need to look elsewhere. USAA also doesn’t directly offer common coverage types like universal life insurance, variable universal life, and indexed universal life. We designed a comprehensive rating methodology based on consumer priorities and life insurance company fundamentals to rank more than 90 insurers across five general categories: financial stability, customer satisfaction, product and feature variety, the overall buying experience, and cost. To do this, we collected over 5,000 data points and scored each company based on 55 metrics. We grouped metrics by category to see how insurers performed in each; we then weighted category scores to determine how companies performed overall. To learn more, read our full Life Insurance Methodology. Article Sources Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in oureditorial policy. NAIC. "Complaint Index 2021."Top Rated For
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USAA Allianz American Fidelity Life Insurance Types of Coverage Whole life, term life, universal life Index universal life Term life, final expense, whole life Dividends for 2020 $42 million Not applicable Not applicable Online Application Available Not Available Available AM Best Rating A++ A+ A- Price for Term Policies Excellent N/A Very Good NAIC Complaint Index 0.22 0.31 .002 Policies Available
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Is USAA Life Insurance Right for Me?
Methodology
FAQs
Why is USAA life insurance so cheap? ›
USAA is so cheap because the company is the largest insurer of the military community, and that volume allows USAA to offer more competitive rates.
What is the financial rating of USAA life insurance? ›S&P Global Ratings: AA+ (Very Strong, second highest rating of 21 possible ratings).
What are the disadvantages of USAA? ›Customers filed relatively few complaints against USAA with the NAIC, and customer satisfaction ratings from J.D. Power are above average for homeowners insurance companies. However, USAA has somewhat limited phone customer support and claims hours.
Why does USAA have an F rating? ›A check of the BBB website provides a few answers. The failing grade is due to two stated reasons. The first is that the company agreed this year to a $15 million settlement with the U.S. Consumer Financial Protection Bureau over how USAA's banking arm mishandled thousands of personal checking accounts.
What does Dave Ramsey recommend for life insurance? ›If you have family members that depend on your earnings, you need life insurance. How else will they replace your income and avoid being left with debt? Dave Ramsey recommends term insurance as opposed to whole life, variable life or universal life insurance.
Which is the best life insurance? ›Company | Best for | AM Best Financial Strength Rating |
---|---|---|
Mutual of Omaha | Digital accessibility | A+ (Superior) |
Nationwide | Customer satisfaction | A (Excellent) |
Northwestern Mutual | Universal life insurance | A++ (Superior) |
Prudential | Policy personalization | A+ (Superior) |
USAA is the fifth-largest auto insurer in the U.S., according to the National Association of Insurance Commissioners (NAIC).
Does USAA pay claims well? ›Sadly, large insurance firms like USAA protect their profits by withholding as much compensation as possible. You could receive only half or less of the money you need to pay hospital bills and get back on your feet after missing time at work.
Is my money safe in USAA? ›Yes. Funds in a USAA FSB savings account are insured up to the limits that the Federal Deposit Insurance Corp. (FDIC) set.
What is the USAA bank controversy? ›(Reuters) - USAA, the financial services company serving military personnel and their families, will pay $62.4 million to resolve a lawsuit claiming it overcharged service members and veterans on interest rates and fees.
Is USAA insurance in financial trouble? ›
USAA took in $32.2 billion in insurance premiums last year, up from $28 billion in 2022, and returned “almost $1.9 billion to member customers through distributions, dividends and bank rebates and rewards.” USAA reported a net income of $1.2 billion in 2023, after posting a $1.3 billion net loss for 2022.
Is switching to USAA worth it? ›Members Saved $725. A survey showed that our members saved an average of $725 per year when they switched to USAA Auto Insurance.
Is USAA trustworthy? ›Most customers' reviews of the USAA insurance claims process are positive. In the J.D. Power 2022 U.S. Auto Claims Satisfaction StudySM, USAA's score places it fourth across all insurance providers. However, this seems to conflict with reporting by the National Association of Insurance Commissioners (NAIC).
Is USAA financially stable? ›Federal regulations require USAA Federal Savings Bank (FSB) to make information about our financial strength and risk management practices publicly available. We're committed to practicing prudent financial and risk management. As a result, we're a safe and stable institution.
What is the AAA rating for USAA? ›OLDWICK, N.J., May 31, 2024--(BUSINESS WIRE)--AM Best has affirmed the Financial Strength Rating (FSR) of A++ (Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of "aaa" (Exceptional) of United Services Automobile Association (USAA) and its property/casualty (P/C) and life/health (L/H) subsidiaries.
Is USAA insurance usually cheaper? ›Is USAA insurance cheaper than others? Auto insurance rates at USAA are often among the cheapest for many types of drivers in different locations. However, to get USAA auto insurance, you need to be a member of the U.S. military, a veteran or an immediate family member.
Is USAA really cheaper for veterans? ›USAA has the cheapest car insurance for veterans and their families on average, according to NerdWallet's January 2024 minimum rates analysis.
Is USAA insurance hard to deal with? ›USAA's Customer Service:
USAA is third in our subrating for customer service with a score of 4.5 out of 5; the average score is 4.1.
Membership Discounts and Savings. When you join USAA, you enjoy specialized financial resources, access to representatives who have been where you are and know where you're going, and products that fit your lifestyle now and in the future. Here are a few of the benefits you get with your USAA Membership.