NEA Life Insurance Review

Discounted life insurance policies for educators

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NEA Life Insurance

NEA Life Insurance

Our Take

Educators who are members of the National Education Association (NEA) can qualify for discounted life insurance policies. With over three million members, NEA negotiated with insurance companies to offer the best possible rates on life insurance. Because NEA members can get group insurance rates on term and guaranteed issue policies, it may be an affordable choice for teachers and retired educators. 

  • Pros & Cons
  • Key Takeaways
  • Company Overview
Pros & Cons
Pros
  • Guaranteed issue policies available

  • Affordable coverage options

  • Complimentary plans are available to new members

Cons
  • Medical exams for certain plans and coverage amounts

  • Optional riders not available on most plans

Key Takeaways
  • The NEA offers affordable insurance products to its members.
  • Eligible members can qualify for term or guaranteed issue policies.
  • All life insurance policies are issued by Prudential. 
  • Through the NEA, members can also get discounted supplemental health coverage, office and classroom supplies, and investment products.
  • Medical exams are required for higher coverage amounts.
Company Overview

The NEA is a non-profit organization that advocates for public school employees. Teachers, school administrators, and retired educators can qualify for NEA membership and take advantage of benefits like affordable life insurance, supplemental health coverage, and even travel accommodations. 

Through the NEA, educators and retired educators can get term and guaranteed issue life insurance policies at lower rates than they’d get applying for insurance on their own. All NEA member policies are issued by Prudential, a major insurance company. 

Prudential is licensed in all 50 states and has been in operation since 1875.

  • Year Founded 1875
  • Kinds of Plans Term, guaranteed issue
  • Number of Plans 5
  • Customer Service Phone, online form, email, chat, FAQ section
  • Phone 800-637-4636 Monday through Friday, 8am - 8pm ET; Saturday 9am - 1pm ET
  • Official Website www.neamb.com

Pros Explained

  • Guaranteed issue policies available: For people who have struggled to qualify for life insurance based on their health or medical history, NEA’s guaranteed issue policies can be helpful. You can get up to $20,000 of coverage if you’re 45 or older. 
  • Affordable coverage options: NEA negotiates rates with major insurance companies to offer its three million members affordable rates. The coverage you can purchase through NEA may be cheaper than you can find elsewhere. 
  • Complimentary plans available to new members: Eligible NEA members are automatically enrolled in a complimentary plan that combines term life insurance with accidental death and dismemberment coverage. 

Cons Explained

  • Medical exams are required for certain policies and coverage amounts: While medical exams aren’t required for some policies, they are required if you choose a plan with a higher coverage limit. For example, group term life policies of $400,000 or more require medical exams. 
  • Optional riders aren’t available on most policies: Most insurance companies allow you to add riders to your policy to get additional coverage. However, plans sold through NEA are more limited. Of the five available policies, only one plan—group term life—allows people to add optional riders to their coverage.

As of 2021, Prudential is the fourth-largest writer of individual life insurance based on direct premiums written.

Available Plans

The NEA offers group and individual term life policies as well as a guaranteed issue policy. Eligibility for the different plans is dependent on your membership status, age, and desired coverage amount. 

There are five different policies to choose from: 

Term Life Insurance

As an educator, affordability is key. If you’re looking for an inexpensive life insurance option, term life insurance could be a good fit. Because term life plans offer temporary coverage, they are usually cheaper than whole life plans. 

There are four term life policies: 

  • NEA Group Term Life Insurance Plan: Available to eligible NEA members and their spouses, domestic partners, and children, the group term life insurance plan offers up to $500,000 in coverage. You can keep the plan for as long as you like, up until you turn 70. After that, your policy’s benefit is reduced. Rates are based on five-year age bands, and your premiums will increase as you age into the next age band. Medical exams are required for coverage amounts of $400,000 or more. 
  • NEA Level Premium Group Term Life Insurance Plan: With the level premium group term life plan, you can purchase up to $1 million in coverage. You can lock in your rate for the entirety of the policy’s 10, 15, or 20-year term. At the end of the term, you can continue your coverage up to age 80. Medical exams are required for coverage amounts of $300,000 or more. 
  • NEA Complimentary Life Insurance: The complimentary life insurance program is free for all eligible members. With this policy, you will get $1,000 of life insurance, up to $5,000 in accidental death & dismemberment coverage, up to $50,000 in accidental and death dismemberment insurance for injuries that occur while working in the capacity as an Association leader, and $150,000 in coverage for unlawful homicide while on the job. 
  • NEA Introductory Life Insurance: Eligible new members can qualify for the introductory life insurance plan for 12 months at no cost. New members are given free $15,000 term life policies. After the 12-month period ends, members can continue their coverage at member-only rates. 

Guaranteed Issue Insurance

Guaranteed issue insurance is usually a form of whole life insurance. However, NEA’s guaranteed issue policy works differently. 

It’s a decreasing term life plan, and it provides limited benefits for the first three years. Once you reach the age of 60, your plan’s benefit amount will decrease. Your rates are dependent on five-year age bands and they increase as you age. 

With this policy, you can purchase $10,000 or $20,000 of coverage, and you cannot be denied based on your health or medical history. Policies are available to eligible members 45 and older. 

The table below highlights how the benefit amount changes on a $10,000 policy.

Age Death Benefit if You Pass Away Within the Age Bracket 
45 to 49 $10,000
50 to 54  $10,000 
55 to 59  $10,000 
60 to 64  $7,500 
65 to 69  $6,000 
70 and up  $3,000 

Available Riders

With most insurance companies, you can customize your coverage to meet the unique needs of you and your family by adding optional insurance riders to your policy. Riders allow you to purchase extra coverage, get insurance for your family members, or access some of your benefits early. 

With NEA, the only policy that offers optional riders is the group term life plan. However, some of its plans have riders included with its price. Depending on your plan, you may be able to take advantage of the following riders: 

Accelerated Death Benefit

If you are diagnosed with a terminal illness, the accelerated death benefit rider allows you to use some of your policy’s face amount for your expenses while you’re still living. 

Child Insurance

When you purchase a term life policy, you can add $10,000 of coverage for each of your children. 

Spousal Coverage

You can purchase term life coverage for your spouse or domestic partner at the same time you apply for coverage for yourself. 

Customer Service

With NEA plans, you can get quotes and submit your application online. Once you apply and are approved for insurance through the NEA, Prudential will issue your policy. Prudential is a large insurance company serving millions of customers, and you’ll go to its customer service department if you have any questions about your coverage. 

If you need assistance, you can contact customer support from 8 a.m. until 8 p.m. ET, Monday through Friday at 1-800-637-4636, or on Saturday between 9 a.m. and 1 p.m. ET. 

Complaint Index

Before buying a policy, it’s a good idea to research the insurer and how it handles policyholder issues. 

The National Association of Insurance Commissioners (NAIC) offers a useful resource: its complaint ratio index. The NAIC collects all of the complaints that customers submit about companies and compares them to the number of complaints submitted about companies of a similar size. 

In 2021, The Prudential Insurance Company of America had a complaint ratio of 8.65 for its individual life insurance segment—more than eight times as high as expected in the market. 

Because the complaint ratio was so high, we looked into the most commonly submitted issues. The majority of consumer complaints concerned policyholder service and claims handling. 

For the past three years, Prudential’s complaint ratio has been significantly higher than the industry standard.

Third-Party Ratings

It’s important to consider a company’s financial stability before buying a policy so you can be confident the insurer will be able to pay out your claim, if necessary. As a major insurer, Prudential has a strong reputation for its financial stability. 

At the end of 2021, AM Best affirmed Prudential’s A+ (superior) rating. In the press release about the rating, AM Best cited Prudential’s balance sheet strength, operating performance, and favorable business profile as its rationale for the higher rating. 

Prudential was one of the 21 insurance companies evaluated in the J.D. Power 2021 U.S. Individual Life Insurance Study. The study researched top companies and ranked and rated them based on their available insurance options, prices, and customer service. In the study, J.D. Power ranked Prudential 15th out of 21, giving the company 753 out of 1,000 possible points— below the industry average rating of 776. 

Cancellation Policy

While Prudential issues the life insurance policies, cancellations must be submitted to the NEA. You must submit a signed letter requesting the cancellation through the mail or email to the following: 

NEA Insurance Operations

Attn: Changes

P.O. Box 9389

Des Moines, IA 50306-9389

Fax: (515) 365-1520

ask-us@neamb.com

If you retire and would like to maintain your policy, you must become an NEA retired member. 

Price

According to the NEA, its policies are often less expensive than policies sold elsewhere because the NEA negotiates with insurers to offer group rates to its 3 million members. For most policies, we found the pricing is competitive. 

For example, below are estimated monthly premiums for $250,000 level premium term life policies. *Non-smoker member rates.

Term Length Age 25 Age 35   Age 45
10 Years $15.13 $16.19 $25.77
15 Years  $13.69  $17.16  $31.79 
20 Years  $14.18  $20.03  $39.73 

You can get quotes for its policies on the NEA member benefits website and submit an application online. 

As with other life insurance companies, NEA and Prudential require you to select either “male” or “female” when you apply for insurance. Being nonbinary doesn’t disqualify you from getting life insurance. However, you should be aware that most insurance companies haven’t updated their underwriting processes to reflect a current awareness of gender issues. 

Competition

While NEA offers affordable life insurance options, its policies are only for educators and retired educators that are members of the organization. Plus, it only offers term life coverage. 

If you are ineligible for membership or are looking for other life insurance options, consider purchasing life insurance through State Farm. State Farm is a top-rated insurance company that sells term, whole, and universal life policies. It has 10 different plans to choose from, so you can likely find an option that meets your needs. 

Buying insurance through State Farm also gives you access to a lengthy list of optional riders you can use to adjust your coverage. Available riders include flexible care benefit, guaranteed insurability option, waiver of monthly deduction for disability, and children’s term insurance benefits.

  NEA (issued by Prudential) State Farm 
Market Share Fourth-largest in the U.S., 4.7% Sixth-largest in the U.S., 3.5% 
Number of Plans  5 10 
Dividends for 2021 N/A $600 million
Wellness Program Discounts/Quit Smoking Incentives  N/A  N/A 
Service Method  Online Agents, online
AM Best Rating  A+ (Superior) A++ (Superior)
Complaints Trend  8.65 0.32
Final Verdict

For qualifying educators, NEA life insurance policies can be an affordable and easy way to purchase life insurance. Because NEA offers group life insurance rates, you may be able to buy a policy for less than you’d spend elsewhere, and most coverage options don’t require medical exams. However, the NEA’s policies are limited to eligible members. If you don’t qualify, you’ll have to purchase coverage from an insurer that doesn't require a membership.

Methodology

Our reviews of life insurance companies are based on a quantitative methodology that analyzes each insurer on their stability and reliability, customer service, claims experience, diversity of product lines, and cost. We compare the terms of each type of policy offered—including available coverage amounts, optional riders, and premium payment options—with that of other major life insurance companies. Lastly, we look at how the company is rated by third-party organizations to determine its reliability and overall reputation.