Personal Finance

USAA Life Insurance Review

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USAA LIFE INSURANCE

  • Rated 5 stars out of 5 for overall performance in NerdWallet’s analysis.
  • Some policies not available in New York.
  • Far fewer life insurance complaints to state regulators than expected for a company of its size.

Shopping for life insurance during the pandemic? Be aware that insurers may have changed their products and policy applications. For the latest information on how to cope with financial stress during this emergency, see NerdWallet’s financial guide to COVID-19.

USAA life insurance is designed specifically for active military members, veterans and their families — and the company sells its products only to them. Term and whole life policies are available nationwide, while universal life is available in every state except New York. With its offerings of potential free perks and wartime coverage, plus its strong financial standing and low number of complaints to insurance regulators, USAA is one of NerdWallet’s top-rated life insurance companies.

USAA life insurance

5.0 NerdWallet rating

USAA life insurance earned 5 stars out of 5 for overall performance. NerdWallet’s ratings are determined by our editorial team. The scoring formula takes into account complaint data from the National Association of Insurance Commissioners and financial strength ratings from A.M. Best.

Based on these ratings, USAA is among NerdWallet’s Best Life Insurance Companies for 2020.

USAA life insurance policies

USAA offers both term and whole life policies in all 50 states to veterans, military members and their families. All policies require a health questionnaire and medical exam before approval.

Term life insurance

Term life insurance policies are available for lengths of 10, 15, 20, 25 or 30 years. Depending on the state, you may receive additional benefits, including:

  • Coverage while in war, which is often excluded from policies.
  • A $25,000 payment if you suffer a severe injury while on active duty, including paralysis, loss of vision or severe burns.
  • Guaranteed coverage after leaving the military.
  • An option to add $100,000 in coverage if you have a baby, get married or buy a house between the ages of 18 and 35.
  • The option to convert to a permanent policy.
  • The option to convert your service members’ group life insurance (SGLI) to a USAA term life policy if you leave the military.

Permanent life insurance

Simplified whole life insurance policies are available for coverage limits up to $1 million. You have the option to make payments for 20 years, until age 65 or for the full duration of the policy. You can also increase coverage after certain life events, up to a total of six times, with a free life event option rider.

Universal life insurance policies come with flexible payment options and with a guaranteed interest rate of 2%. Universal life policies are not available in New York.

Depending on your state, USAA may offer additional riders, including:

  • Child protection plan, which allows you to add all of your kids to your policy. Your children may have the option to convert it to their own policies when they’re older, regardless of their health.
  • Waiver of premium benefit, which waives your premium should you become disabled.

» MORE: Compare life insurance quotes

Customer complaints for USAA

Over three years, USAA has drawn far fewer complaints to state regulators than expected for a company of its size for life insurance, according to a NerdWallet analysis of data from the National Association of Insurance Commissioners.

More about USAA life insurance

You can get a quote and apply for a life insurance policy, plus pay your bill and manage your account from the USAA website and iPhone and Android mobile apps. USAA also has a survivors relations team that can assist families of deceased USAA members, including help with any survivor benefits.

USAA auto and homeowners insurance

USAA offers auto and home insurance to active military members, veterans and their families. For more information, read our USAA insurance review.

USAA life insurance pros and cons

Methodology: Life insurance ratings

NerdWallet’s life insurance ratings are based on weighted averages of complaint index scores from the National Association of Insurance Commissioners for individual life insurance, and financial strength ratings from A.M. Best, which indicate a company’s ability to pay future claims. To calculate each insurer’s rating, we adjusted the NAIC and A.M. Best scores to a curved 5-point scale.

These ratings are a guide, but we encourage you to shop around and compare several insurance quotes to find the best rate for you. NerdWallet does not receive compensation for any reviews.

Methodology: Insurer complaints

NerdWallet examined complaints received by state insurance regulators and reported to the National Association of Insurance Commissioners in 2016-2018. To assess how insurers compare to one another, the NAIC calculates a complaint index each year for each subsidiary, measuring its share of total complaints relative to its size, or share of total premiums in the industry. To evaluate a company’s complaint history, NerdWallet calculated a similar index for each insurer, weighted by market shares of each subsidiary, over the three-year period. Ratios are determined separately for auto, home (including renters and condo) and life insurance.

This article originally appeared on NerdWallet