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Everything you should know about Transamerica life insurance

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This provider offers competitive pricing, unique underwriting leniencies and high approval rates for older applicants.

With a history dating back to 1904, Transamerica is a reputable life insurance and investment firm out of San Francisco, where its pyramid-shape building is a prominent part of the skyline.

It offers a range of life insurance policies that include term, whole and universal options. Through its straightforward site, you can read through details of policy, all written in plain language to help you more easily understand your ideal plan.

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    What is Transamerica known for?

    Transamerica’s success is a result of expansions and acquirements that’s made it a recognized brand for life insurance at affordable rates. Its logo evokes San Francisco’s Transamerica Pyramid, the city’s most prominent building.

    While Transamerica’s coverage might not be as comprehensive as other insurers, lower pricing could make it a solid option for younger policyholders or those with smaller budgets.

    They are financially secure, so you should have no problem receiving your death benefit payout.

    In 1999, Transamerica was acquired by Aegon, among the world’s leading insurers and finance companies dating back to 1844. With such financial security, Transamerica’s positioned to payout death benefits to its many policyholders.

    Pros and cons

    Transamerica is a reliable insurance provider that’s served American customers for decades. While its policies and rates are competitive, there are a handful of things to be aware of if you decide to go with this provider:

    Pros

    • Wide selection.Transamerica offers a full range of life insurance products including term, whole, universal, indexed universal and variable universal.
    • Financially sound.The company has very strong/superior credit ratings, meaning that it has a strong ability to repay its debt obligations.
    • Unique underwriting leniences.The company offers unique underwriting leniences, allowing for higher approval rates for higher risk applicants.

    Cons

    • Lack of whole insurance coverage.The whole life insurance option only provides a maximum death benefit of $50,000 which may not be enough for some people.
    • No online claim forms.The claims process is very unclear, and the website doesn’t offer an option to start a claim online. Instead, you have to call customer service and follow the instructions.
    • Below average customer service.Many users report below average customer service. From trouble reaching a representative to unhelpful agents, this behavior isn’t ideal for a life insurance provider.

    What life insurance coverage does Transamerica offer?

    Transamerica offers term, whole, universal and variable universal life insurance policies. It also sells situational policies for accidental death or final expenses, most that you can obtain only through a Transamerica agent or financial advisor.

    Term life insurance is Transamerica’s most affordable option, designed to provide coverage for a specified period of time. Plans are available in 10-, 15-, 20-, 25- and 30-year terms, all of which can be converted to permanent policies before the end of the term. You might be able to renew your policy after coverage ends for a shorter term, but premiums will most likely be higher with each renewal. These policies do not grow in cash value, but will instead pay out a fixed amount between $25,000 and $2 million depending which policy option you choose:

    • Trendsetter Super. Provides up to $1million in coverage, all of which is guaranteed to remain the same throughout the initial term. The plan is available for applicants ages 18 to 80, and you may be eligible to convert to a permanent policy without medical exam at the end of the term. This is Transamerica’s standard term life insurance option.
    • The Trendsetter LB. Provides death benefit protection up to $2 million in addition to living benefits. The benefits allow the option to receive an accelerated death benefit in the event of a qualifying chronic, critical or terminal illness while the insured is alive. Once again, applicants may be eligible to convert to a permanent policy once the term expires.

    Transamerica offers flexible death benefit options, allowing you to choose whether your benefits decrease, remains the same or increases over time:

    • Decreasing term. The money left to your beneficiaries will decrease over time, meaning your premiums will decrease as your coverage needs decrease.
    • Level term. The benefit paid to your beneficiaries remains the same over the term of your policy. This is often called a fixed or guaranteed death benefit.
    • Increasing term. The death benefit payout increases over the term of your policy. This policy is ideal for those anticipating larger expenses later in life.
    Transamerica offers a group and individual life insurance options. Both plans feature fixed premiums, a guaranteed death benefit and cash value accumulation. Coverage starts at a minimum of $2,000 up to a maximum of $25,000 and $50,000, respectively. Policy holders are allowed to borrow from their cash value and the death benefit will remain the same if the loan is repaid on schedule. Death benefits are not subject to federal income tax, and although inheritances are generally subject to estate taxes, these policies may be set up to avoid paying estate tax as well.
    Universal life insurance policies at Transamerica offer more flexible permanent life insurance coverage. These policies offer the freedom to adjust the amount and frequency of premium payments, or even the allocation of funds in the case of the variable universal plan. You can borrow from your cash value without any deductions, provided that the loan is repaid on schedule. Transamerica offers three options for Universal life:

    • Index universal life insurance. The plan features flexible insurance premiums with cash value growth tied to an index account. While this plan doesn’t offer a guaranteed death benefit like with whole insurance, the indexed account creates the potential for an increased or decreased death benefit payout.
    • Group universal life insurance. This is the standard universal life insurance policy at Transamerica, offering growth potential and flexibility that’s not tied to an index. This plan is only available through employers and offers lifetime coverage with adjustable premiums and an accumulation of cash value.
    • Variable universal life insurance. This option is an investment-heavy version of your typical universal life insurance policy. Expect the same coverage and adjustable premium payments with greater potential for cash value accumulation. This plan is more expensive than the other two options, but offers greater upside potential and flexibility in the allocation of your cash value.

    What’s not covered in my policy?

    Most policies offer a selection of riders that can be added to provide extra coverage in certain situations. For example, some insurance providers don’t offer coverage for children, but will offer a “child term rider” that will insure a child without having to purchase an entire policy. Here are the riders offered at Transamerica:

    • Decreasing coverage rider. Allows policyholders to decrease their coverage as they pay off debts or certain expenses.
    • Additional insured and child riders. Offer additional coverage for a spouse and child, without having to take out a separate life insurance policy.
    • Estate protection rider. Offers extra coverage for estate taxes if they’re applied to your death benefit.
    • Final expense rider. Offers an additional payout to cover funeral expenses.
    • Whole life guaranteed insurability rider. You can convert to a whole life policy without medical exams or proof of insurability. It’s only available at major milestones such as the birth of a child or marriage.
    • Return of premium rider. Provides a payout to you if you outlive your policy term. But it’s only available for 20- and 30-year terms.
    • Waiver of premium rider. This rider provides extended coverage if you become totally disabled for over six months. Your premiums for your life insurance policy are waived.

    How can I get the best life insurance rates at Transamerica?

    When you’re comparing life insurance rates, it’s tough to predict the rates you’ll pay since every provider has a different process to determine your rates. To qualify for Transamerica’s “preferred plus” you’ll need to meet the following eligibility requirements:

    • Have a minimal or no history of tobacco use.
    • Have no history of alcohol or substance abuse.
    • Have a personal and family health history free of specified disease or impairments.
    • Have a clean driving record free of DWIs, DUIs, suspensions and other convictions.
    • Have a healthy blood pressure and BMI.
    • Have a low-risk occupation or hobbies.

    How do I file a life insurance claim with Transamerica?

    The claims process at Transamerica is fairly unclear. There are no options to file a claim online, only a phone number and email. To file a claim call 800-797-2643 Monday through Friday, from 9 a.m. to 6 p.m. Eastern time. Otherwise, you can contact them via email at tii.customerservice@transamerica.com.

    What do customers say about this brand?

    Transamerica is not currently accredited by the Better Business Bureau (BBB), and it has a C- rating on the official BBB website. This below-average rating goes hand in hand with a long list of negative customer reviews — over 400. The majority of online reviews are overwhelmingly negative, most of which reporting a lack of customer service or trouble getting claims paid.

    Transamerica financial stability and credit ratings

    Insurance providers are given a credit rating that analyzes their ability to repay debt obligations. While A.M. Best is the most relevant agency in the insurance sector, we consider the other three — S&P, Moody’s and Fitch. Here are the most recent credit ratings for Transamerica:

    • A.M. Best. A+ (superior)
    • Standard & Poor’s. AA- (very strong)
    • Moody’s. A1 (good)
    • Fitch. AA- (very strong)

    What other services does Transamerica offer?

    Transamerica offers a few other products alongside its life insurance policies. These products include:

    • Medicare supplement insurance
    • Mutual funds
    • Annuities
    • Retirement plans
    • Employee benefits

    Bottom line

    Transamerica is ideal for customers looking for affordable life insurance, as it offers plans directly to consumers and to employers. Prices are competitive, but coverage and death benefit amounts are lacking for what you pay. The company has a strong reputation and is financially stable, but you may find better options.

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