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Transamerica is a financially stable insurer that offers a respectable range of policy types and a number of available riders, including three living benefit riders included at no upfront cost on some policies. The company also offers policies without a medical exam. But Transamerica scored poorly in the J.D. Power 2021 U.S. Life Insurance Study and received more complaints than expected for a company of its size.
- Pros & Cons
- Company Overview
Multiple no-medical-exam policy options
Living benefits included on some policies at no upfront cost
Wide range of riders available
More complaints than expected
Ranks poorly for customer satisfaction
Founded in 1904, Transamerica offers term, index universal life, final expense, and whole life insurance across all 50 states and the District of Columbia. Transamerica is headquartered in Cedar Rapids, Iowa.
- Multiple no-medical-exam policy options: The company makes up to $2 million in coverage available without a medical exam to healthy applicants.
- Living benefits included on some policies at no upfront cost: Some Transamerica policies include living benefit riders for terminal, critical, and chronic illnesses at no upfront cost. These let you access a portion of the death benefit early if you’re diagnosed with a qualifying illness.
- Wide range of riders available: Transamerica offers a range of riders with which you can customize coverage, including a disability income rider which is a rare offering among the 90 life insurance companies we reviewed.
- More complaints than expected: The company received more complaints than expected for a company of its size over the last three years.
- Ranks poorly for customer satisfaction: Transamerica scored poorly in the J.D. Power 2021 U.S. Individual Life Insurance Study. The study ranks major insurers based on overall customer satisfaction based on communication, interaction, price, product offerings, and statements.
The National Association of Insurance Commissioners (NAIC) calculates an annual complaint index to help consumers understand how many complaints insurance companies receive based on their size. For example, a complaint index over 1.00 means an insurer received more complaints than expected for its size, whereas a complaint index below 1.00 indicates that the company received fewer complaints than expected.
Transamerica received somewhat more complaints than expected and has a three-year average complaint index of 1.37. This amount of complaints is mildly concerning when you consider that most of our other best life insurance companies have a complaint index less than 1.00.
Transamerica received an AM Best rating of A (Excellent). AM Best ratings measure how financially strong an insurance company is. This way, consumers can get an idea of how likely an insurance company is to meet its contractual insurance obligations. An A (Excellent) grade indicates that Transamerica has an excellent ability to meet its ongoing insurance obligations.
Unfortunately, Transamerica did not score well for customer satisfaction, which may not be surprising considering it received more complaints than expected. The company scored 19th out of 21 major life insurance companies in the J.D. Power 2021 U.S. Individual Life Insurance Study, well below the industry average.
When determining which company to choose for your life insurance needs, it’s helpful to compare a few different insurers.
|Transamerica||State Farm||Pacific Life Insurance|
|Types of Coverage||Term, Index Universal Life, Final Expense, Whole Life||Term, Universal Life, Final Expense, Whole Life||Term, Index Universal, Variable Universal, Universal Life, Whole Life|
|Online Application||Not Available||Not Available||Not Available|
|AM Best Rating||A||A++||A+|
|Price for Term Policies||Average||Poor||Excellent|
|NAIC Complaint Index (averaged over 3 years)||1.37||0.295||0.056|
|J.D. Power Ranking||19||1||4|
Transamerica offers the following types of policies:
Term Life Insurance
Term life insurance covers you for a certain amount of years and is not designed to be permanent. That being the case, it’s much more affordable than permanent coverage options like whole and universal life. Transamerica’s term policies are available for periods up to 30 years and can be converted to permanent coverage before the end of the term or renewed on an annual basis once the initial term expires.
Whole Life Insurance
Whole life insurance is a type of permanent coverage, meaning it’s designed to last your lifetime. It has a tax-deferred cash value component that builds value, and you may be able to access it via policy loans. The death benefit and premiums in a whole life policy are fixed throughout the life of the policy. If you miss a payment, your coverage could lapse.
Final Expense Life Insurance
Final expense insurance is a small whole life policy designed to cover final expenses such as burial costs and medical bills. You can apply for coverage up to $50,000 without a medical exam. Unlike some other companies’ final expense policies, you can apply for coverage up to age 85. Some policies have a graded death benefit which limits coverage for the first two policy years.
Indexed Universal Life Insurance
Indexed universal life (IUL) insurance is a universal life policy in which the cash value is pegged to a market indicator, such as the S&P 500. Unlike a variable life insurance policy, the cash value is not directly invested in the market so you won’t lose value based on negative performance. However, gains are also capped, so it’s important to understand how gains are credited to the policy before signing up.
Transamerica makes a wide selection of riders available on its life insurance policies. Riders are extra features you can add to your coverage, usually for a cost. But some riders don’t have any upfront cost, like certain living benefit riders. Instead, you pay an administration fee if you elect to use them.
Disability Income Rider
Few other life insurance companies we reviewed make this rider available, which can be used to supplement your income should you become totally disabled.
ADB: Terminal Illness
This is a type of accelerated death benefit (ADB) rider which lets you access the death benefit early if you’re diagnosed with a terminal illness.
ADB: Chronic Illness
Another type of ADB, the chronic illness rider lets you accelerate the death benefit if you’re diagnosed with a chronic illness and are unable to perform at least two activities of daily living, or are severely cognitively impaired.
ADB: Critical Illness
The critical illness ADB lets you access the death benefit early if you suffer a critical illness, such as a heart attack or certain types of cancer.
Accelerated death benefit riders, if exercised, reduce the death benefit your beneficiaries receive. The reduction depends on how much of the death benefit you advance.
Guaranteed Insurability Rider
A guaranteed insurability rider lets you increase your coverage upon certain option dates without having to go through underwriting.
With a child term rider, you can add a small amount of coverage for your children to your own policy. One rider usually covers all eligible children, and they have the option to convert to permanent coverage upon reaching adulthood.
Waiver of Premium
This rider waives your premium payments in the event you become totally disabled.
Accidental Death Benefit
With this rider, your beneficiaries get an increased payout should you die as the result of a qualifying accident.
Those looking to reach Transamerica’s customer service have a few options. You can submit your query through an online contact form or email, or you can connect with an agent via phone at (800) 797-2643. To ensure the customer support process is as seamless as possible, Transamerica recommends sending the following information via email:
- Your name and relationship to the policy or owner
- Policy number (or type of policy if policy number is unknown)
- Owner’s name on the policy
- City and state of the policy owner
- Phone number
- A detailed explanation of what you need
Transamerica charges fairly average prices for its term policies compared to 31 other life insurance companies we reviewed. We gathered quotes for 30-year $250,000 term policies for males and females ages 25, 40, and 55 in excellent health.
Is Transamerica Right For Me?
Transamerica is one of our best life insurance companies, and specifically made the list for policy customization. Meaning that if you want the ability to personalize your coverage with a wide array of available riders, or add-on features, Transamerica is a good choice. In particular, the company offers a disability income rider, which is not available from most of the 90 life insurance companies we reviewed.
However, Transamerica made a very poor showing in the J.D. Power 2021 U.S. Individual Life Insurance Study. Out of 21 major life insurance companies, it came in 19th for customer satisfaction. This may give some consumers pause, especially if they only need basic life insurance coverage without any bells and whistles.
How We Review Life Insurance Carriers
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.
In order 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.