I just got my monthly reminder from AARP that I have not yet purchased that life insurance through the AARP Life insurance program that I inquired about 5 years ago, and I haven’t talked about senior life insurance or final expense life insurance for a while so I thought this might be a good chance to renew my vow of disdain for AARP and New York Life.
Normally these slip off into the trash but for some reason today I decided to take a look at it and see what’s new. I did run across a few gems that, frankly if I was the one putting out these monthly entertainment pieces, I would have highlighted. For instance, and I will do this the way I think they should just because it is so AARP, “THE AARP LIFE INSURANCE PROGRAM IS THE ONLY LIFE INSURANCE PROGRAM TO EARN THE ENDORSEMENT OF AARP!” No, seriously?
It isn’t even their program. It is underwritten by New York Life but I’m guessing NYL is OK with them not endorsing that relationship and just owning it and loving just themselves for it. I suspect that New York Life cringes every time they see or hear their name attached to simply one of the most overpriced, unfair, unscrupulous life insurance products or programs on the face of the earth.
Generally I would just link back to a comparison to drive this point home, but let’s start fresh. After all, they did dedicate an entire tree to me. I’m 59 and in good, but not great health. I could certainly qualify for a standard rate class and most folks my age could get standard or better as well. I’m going to just cut to the kill on this because AARP is promoting this as senior or final expense insurance. It is meant to be the one that pay out when us old folks bite it.
Right now at a standard rate I can buy a $50,000 life insurance policy with a guaranteed level premium to age 100 for $98 a month. At age 100 the premiums stop, guaranteed, and the death benefit continues to age 121, guaranteed. Most folks my age can get preferred rates and that would make that premium $78 a month.
With AARP I can buy a 5 year term right now for $74.85 a month. That price is not guaranteed even until next month, but that is the first premium. It goes up every 5 years. Not every 5th year of the policy, but by age. So next year when I’m 60 the rate will go up to $108.25. 5 years after that to $143.96 and 5 years after that to $207.25. At age 76 if I wanted to keep going with AARP I would have to convert to their whole life policy for about $350 a month. So with my traditional policy by year 2 I am going to be paying less than I will ever pay for AARP, guaranteed and if I live to any kind of a ripe old age I will have paid in a fraction of what I would have to our oh so beloved AARP. With them by age 79 I will have paid for my own death benefit.
AARP and New York Life should be ashamed, but they’re not. They should be thrown in jail for talking senior Americans into this kind of horrid ripoff, but that won’t happen. AARP and New York Life are hideous thugs but they continue to get away with it because they are so branded that they can screw you and make you believe you got the best the industry has to offer.
Bottom line. If you, your parents or grandparents have, or are considering buying AARP Life insurance get a second opinion first. Find an independent agent and make sure you know what the options are. I’m in the business so it is obvious to me how bad it is, but most older Americans would trust AARP with the keys to their house. They can’t imagine that it’s not the fairest thing in the whole country. If you have questions or would like a second opinion/comparison, call or email me directly. Let’s talk.