AIG Guaranteed Issue Life Insurance Review

Written by Jeff Root

Before we take a look into AIG, it’s history, financial ratings, types of policies offered, rates, and more, let’s take a brief look at some of the highlights of AIG Life Insurance.

Review of AIG Guarantee Issue Life Insurance
Customer Reviews 4.0 / 5
Guaranteed Issue Policies
  • Guaranteed Issue Whole Life
  • Accidental Death
Other Life Insurance Policies
  • Guaranteed Universal Whole Life
  • Term Life
  • Variable Universal Life
  • Indexed Universal Life
Coverage
  • Guaranteed Issue: $5,000 – $25,000
  • Term & Whole Life: $100,000 – $2,000,000+
Riders
  • Terminal Illness Rider
  • Chronic Illness Rider
Pros
  • Affordable guaranteed issue life insurance
  • Competitive pricing
  • Good riders available
  • Very dependable company, with high reviews
  • Lenient underwriting for people with health conditions
Cons
  • For guaranteed issue, they are not the cheapest option
  • For accidental death, they are not the cheapest option either

AIG Guaranteed Issue Life Insurance Review -Company History

aig guaranteed issue life insurance reviewAIG is one of the largest insurance companies in the world with a rich history of change and innovation. The company was founded in 1919 by Cornelius Vander Starr in Shanghai, China. They were originally known as American Asiatic Underwriters.

In 1939, at the start of World War 2, the company was forced to relocate their headquarters from Shanghai to New York City because of the Japanese invasion of China. It wasn’t until 1969 that AIG actually became a publicly traded stock company.

In 2001, AIG acquired American General Corporation, a leading life insurer.

This is where their story may sound familiar. After the acquisition of American General, AIG transferred all its life division under that moniker. It wasn’t until the last couple of years that AIG finally rebranded American General to AIG Life.

The life company name change may create a little confusion. For years, AIG ran AIG Matrix Direct but sold American General products. AIG Matrix was their internal direct sales arm selling exclusively American General products. Eventually, the names were changed and AIG Direct still sells AIG life exclusively.

Today they are ranked as one the most financially stable insurance companies in the US.  The chart below shows some of AIG’s financial ratings.

Company Financial Rating
A.M. Best A
Moody’s A2
Fitch AA-
S&P A+

AIG Life Products & Special Features

Like most life insurance company, AIG sells both term and permanent insurance, but with a wide variety of policies and options. Let’s talk through term life first.

Term Life Insurance Products

You probably have a good handle on term and permanent, but as a refresher, here’s a quick definition: term life protects you for a specific period of time or term that you choose on the front end of the policy.

Here are AIG’s Term Life Insurance products:

AG Select-A-Term

Most term products give you term choices in increments of 5 or 10 years. Select-A-Term is different. Terms start at 10 years, jump to 15, and then continue for 16,17,18…all the way to 30. What a unique idea? Many people use term to protect mortgage debt. What if you only have 16 years left, why buy a 20 year term? It’s a nice option that is truly different.

Other features:

  • Convertible into a permanent policy up to age 70
  • Coverage from $50,000 up to $10 million if approved.
  • Level premiums (price doesn’t increase) throughout the policy term
  • At the end of the term, it can be renewable in one year increments up to age 95

You can also ladder your cover. This is a financial strategy your agent can help you with. Basically, you can buy multiple policies for a variety of protection strategies.

For example, you want to cover your mortgage debt, so you buy a 15 year term at $300,000. You also want to provide for college expenses for your family if you die. Your youngest won’t hit college until 18, so you purchase an 18 year term at $200,000.

AG ROP Select-A-Term

ROP means return of premium. It’s a term policy that gives your premium back at the end of the term if you survive the policy period.

  • Available up to age 55
  • minimum coverage is $100,000
  • Usually 2-3x as much cost as regular term
  • You can surrender for cash
  • You can convert to whole life rolling the existing cash value into the new policy
  • You can stop paying the premium once you have enough cash value and have paid up life till age 95…there will be a decrease in death benefit

Permanent Life Insurance Policies

Permanent Life insurance, unlike term which has an end, covers your whole life. Most permanent policies will also accrue cash value. If a policyholder determines, he doesn’t need life anymore he can surrender for the cash value.

Another option would be to keep the policy and borrow against the cash. If cash value is high enough, you may be able to stop paying premiums and allow the cash value to fund the premiums.

AG Secure Lifetime GUL 3

GUL stands for guaranteed universal life. Universal Life is a permanent policy with the cash value tied to a money market account. The returns on cash are guaranteed at a specific rate.

  • Conservative cash growth product
  • Available from age 18 to 80
  • Minimum coverage is $100,000
  • Premiums are fixed and level but flexible. You can pay premium early, and eventually use the cash to pay the premium.
  • Over the life of the policy, your can decrease coverage if necessary or increase with underwriting approval

AG Secure Survivor GUL 2

This is another version of their guaranteed universal life product, but covers 2 lives instead of one, and pays out upon the survivors’ death. Survivor policies are not designed to protect a spouse but leave money to a child or charity. It is much cheaper than purchasing two policies, and available for ages 50-75.

Elite Index II and Survivor Index II

These two policies are both universal life policies. However, rather than being tied into a money market fund, the cash accumulation is tied to an index fund. An index fund follows the returns of a common investment index such as the S&P 500.

Unique features:

  • 3 index funds to choose from and a cap rate. The cap rate is the top end return the fund will guarantee.
  • Choice loans…if you take a loan from the policy, the remaining cash value will continue to accumulate in the index fund.
  • Accelerated access solution. This is a chronic illness benefit that allows you to receive a portion of the coverage as a monthly income.

Max Accumulator

This policy is perfect for those with pre-existing medical conditions. It is a universal life product available to ages 18-80. The minimum coverage amount is $50,000.

The benefit for those with health issues is that you can purchase a “no exam” policy if you are under 50 up to $500,000 in coverage.

AG Platinum Choice VUL

Platinum Choice is AIG’s variable life product. Variable life is another type of permanent insurance. The difference is the cash accumulation portion. Variable life ties the cash portion to a true investment account like a mutual fund.

You will have multiple choices in the degree of aggressiveness in investments. The more aggressive investments have the potential for a greater return, but also greater risk.

Basic Features:

  • 3 Different Fund options differing in risk tolerance.
  • No cap on growth or losses
  • Available for ages 18-80
  • $100,000 minimum coverage

Guaranteed Issue Whole Life

Guaranteed Issue Whole is another product by AIG designed for people with health issues that struggle finding life coverage. This policy is ideal with pre-existing high risk health conditions such as diabetes or even former substance abusers.

  • Available for ages 50-85
  • 2 year graded death benefit. This is common among guaranteed issue whole life policies. During the first two year, if the insured dies from illness, suicide or another nonaccidental cause, the death benefit is 110% of premiums paid. This is a higher payout than most guaranteed policies during the graded benefit period.
  • $25,000 maximum coverage amount
  • Chronic illness rider: The customer receives a return of all premiums paid up to 50% of face value if diagnosed with severe cognitive impairment.
  • Terminal illness rider: 50% of death benefit is paid to the insured if diagnosed with terminal condition.

Accidental Death Insurance

Accidental Death Insurance is another option for those with serious medical conditions who don’t want to be subject to a medical exam.

It is very similar to the guaranteed whole life policy, except it only covers death from accidental injuries and not a disease.

Many customers will choose this coverage to have life insurance in place, while they are going through more detailed underwriting to qualify for a broader policy.

How Do You Know What to Buy?

As you can see AIG has a diverse selection of products for a variety of customer needs.

Is there one specific customer that is perfect for AIG insurance?

AIG excels with customers who are considered high risk for life insurance for both their term and permanent products.

One reason they do so well compared to others is their very loose and flexible underwriting criteria for conditions such as diabetes and heart disease as well as any lifestyle conditions such as marijuana use. Even insured with high risk professions and hobbies do well in AIG when they might be rejected by other insurance carriers.

Why Choose Us When You Can Buy Direct?

AIG is undoubtedly one of the best life insurance companies on the market, offering affordable and comprehensive coverage for a large variety of products.

Specifically, when speaking about guaranteed issue life insurance, AIG may not be the best option for life insurance.

There are dozens of life insurance companies on the market that offer guaranteed issue life insurance for cheaper rates, with better coverage options.

Finding the best guaranteed issue life insurance policy for your specific situation can best be done while working with a professional.

Give us a call today or use our online quoting engine to find the best guaranteed issue life insurance policy for you.

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