Transamerica Life Insurance Review
How We Reviewed Transamerica Life Insurance
71 life insurance companies compared
4 independent ratings groups consulted
8 policy types evaluated
Transamerica Life Insurance Review
Transamerica is one of our favorite companies for term life insurance — better yet, it’s the best for affordable term life insurance. Its policies manage to be well-rounded and flexible, while still pulling consistently low premiums in our quote comparisons.
In terms of policy options, we love that Transamerica offers term life coverage ranging from 10 to 30 years in length, and from $25,000 to $2 million for death benefits. This is a wider range than most companies on both counts. Since term life insurance is meant to provide affordable coverage as long as you need it (and no longer) Transamerica’s flexibility is key.
Transamerica has the credentials to back up its offerings, too. The company earned top financial strength scores from three separate ratings agencies, meaning it can be counted on to pay out if you need to file a claim. The only place Transamerica fell a little short was for customer service; polling “about average” in J.D. Power’s customer satisfaction survey. That may be something to look out for if excellent support is high on your list of must-haves.
Transamerica emphasizes the highly individual nature of life insurance, claiming to offer a “range of flexible products to suit your personal needs.”
Is it true?
Partly. It’s true that Transamerica’s term life insurance is singularly flexible. It offers an impressive range of death benefits and term length options, so most people will be able to find a policy that fits their needs and their budget. The company also has a good selection of policy add-ons; like an accelerated death benefit, disability coverage, and the option to purchase long-term care insurance. This means you’ll be able to bolster your life insurance wherever you need extra protection.
So why is it only partially true? Transamerica’s claim would lead us to believe that all of its policies are extra-customizable — not only term insurance, but permanent insurance products as well. This is where the company fails to deliver. Transamerica’s whole life insurance maxes out at a $50,000 death benefit, which is on the very low end of the scale. It’s basically only an option if you’re covering end-of-life expenses and little else. Since whole life is often looked at as an alternate channel for saving or inheritance, Transamerica’s limited policy sizes take it out of the running for a large percentage of customers.
We don’t recommend Transamerica if you’re looking for a universal life policy, either. Its universal option — Transamerica Financial Fund Indexed Universal Life (FFIUL) — has been controversial in recent years, even being sued for upping prices on active policies.
Don’t let that turn you off on the company as a whole, though. Transamerica has a positive reputation for offering sound, affordable term life policies. Of course, prices are individual, so we recommend getting multiple quotes before buying. But if you’re thinking term insurance then Transamerica should make the list.
Affordable term life insurance
Whole or universal life insurance
|Financial strength ratings||A.M. Best: A+
Standard & Poor’s: AA-
|J.D. Power customer satisfaction score||780 / 1,000|
|Insurance types offered||Term, whole, universal|
|Term lengths offered||10, 15, 20, 25, 30 years|
|Standout coverage||Guaranteed level premiums for term insurance
Accelerated death benefit
Disability waiver of premium
Accidental death insurance
Long term care insurance
|Customer tools||Online quotes for term insurance
Community financial forum and blog
*Trendsetter LB term life policy not available in New York
Flexible term life policies
The goal of term life insurance is to provide coverage during the most critical financial periods of your life; for instance, while you have a mortgage out on the house, or while you’re paying your kids’ way through college. The best term life policies can be tailored to your unique situation — so you’re protected during these important times, without paying for more coverage than you need. This is where Transamerica excels.
Transamerica term life policies start at just $25,000 death benefit; one of the lowest entry points we’ve seen. That gives customers the opportunity to purchase a small-size, super affordable policy. The company also offers terms from 10 to 30 years, in five-year increments. Note: it even has a 25-year term, which some companies with similar options (like TIAA Life) skip over. Most people will be able to find the right term for their needs with Transamerica.
Well-rounded coverage selection
After choosing the right type of life insurance and the right term length (if applicable), you’ll have the option to customize your policy through add-ons or “riders.” Transamerica has a good selection in this department. Most importantly, it offers an accelerated death benefit rider, which lets the insured access funds during life to cover bills for a critical illness.
Other highlights include a disability waiver of premium rider, which forgives future payments if the insured is injured and can no longer work; and an accidental death rider, which may pay as much as 200% of the death benefit if the insured dies of accidental causes. If you’re considering a Transamerica policy, be sure to speak with an agent about rider options that may benefit you.
Generally affordable for term insurance
The larger your death benefit, the larger your premium. That means Transamerica’s low bar for entry — terms insurance starting at $25,000 — allows it to offer some of the cheapest policies on the market by default. Even for a larger policy, though, Transamerica’s prices are likely to be competitive. We pulled the quotes to prove it. After comparing a few companies’ premiums for different scenarios (by age, gender, and health level) we were impressed with Transamerica’s low cost — beginning at just under $11 per month.
Long-term care insurance available
Although Transamerica doesn’t offer long-term care as a life insurance add-on (some providers do), the company does sell it as a separate policy. Long-term care coverage can be incredibly valuable down the road.
It may save family members from paying huge medical bills out of pocket, allowing them to take care of their loved ones in the best way possible. If you’re looking for both term insurance and longer-term medical care coverage, Transamerica may be a good choice for keeping both policies under one roof.
Limited whole life policies
While Transamerica puts up a strong showing for term life insurance, it wouldn’t be out first stop for a whole life policy. The insurance experts we spoke with agree: whole life insurance is generally best used as a secondary retirement or savings channel after you’ve maxed out traditional accounts. Transamerica’s whole life policies come with a low limit, maxing out at $50,000, so it’s likely not your best option for those purposes.
That said, any size permanent policy offers a guaranteed death benefit payout. So if your whole life insurance needs are truly minimal (say, funeral expenses alone), Transamerica may still be a viable choice for coverage.
Average customer service
Transamerica’s reputation for customer service is strictly mediocre. In J.D. Power’s 2017 customer survey, the company was rated “about average” for its support channels. Of course, “average” is still a passing grade, meaning you shouldn’t expect interactions to be noticeably poor. But if excellent support is a big selling point for you, you may be better off with a company like State Farm (which has earned J.D. Power’s gold award four years running).
|Term life coverage starts at|
|Whole life coverage starts at|
|Term lengths (years)|
|Guaranteed level premiums|
|Accelerated death benefit|
TIAA Life vs. Transamerica
TIAA and Transamerica run pretty neck-and-neck for term life insurance. They both nailed all the major criteria we look for in great coverage; including level premiums, renewable and convertible policies, and a wide selection of policy riders. However, TIAA may have a slight edge when it comes to price. It rang in a few dollars cheaper than Transamerica in almost every scenario we tested.
It’s important to keep in mind that life insurance prices are highly personal, though. Since cost is dependent on your age, health, family history, and other factors, it’s impossible to say which company will be cheapest for you until you’ve compared quotes. We’d recommend checking prices at both TIAA and Transamerica to see who can offer the best deal on your coverage.
New York Life vs. Transamerica
It’s clear that Transamerica isn’t our top choice for permanent life insurance — which may leave you wondering who is. Enter New York Life. This is one of our top providers across the board; for whole and universal policies as well as term.
When it comes to whole life coverage, we appreciate that New York Life offers an incredible range of death benefits. You can purchase a policy starting at $50,000 or ending in the tens of millions — meaning there’s almost no limit to its capacity as a savings or inheritance channel. (Unless you’re Jeff Bezos. But you’re probably not). New York Life also offers especially flexible guaranteed universal life policies, which makes it one of our favorite life insurance companies for seniors. Start your search here if you’re set on permanent coverage.
State Farm vs. Transamerica
One of the drawbacks we noted about Transamerica was its customer service: not awful, but not outstanding, according to the company's policyholders. If you’re someone that puts a lot of stock in customer service, you may be better off purchasing coverage elsewhere. We recommend State Farm. This company lives up to its rep of being “like a good neighbor”: as of 2017, it’s taken home J.D. Power’s gold award for customer satisfaction four years in a row.
That said, there may be a minor trade-off between service quality and price. Our quote comparisons showed higher premiums from State Farm than other term life providers; including Transamerica, TIAA Life, New York Life, and The Globe. Remember that prices are individual, so this isn’t set in stone. It’s definitely worth getting a State Farm quote while you’re shopping around to see how prices stack up.
Is Transamerica life insurance right for me?
Yes — if you’re in the market for term life insurance. Transamerica meets all of our benchmarks for great term coverage, including guaranteed level premiums, renewability, flexible term lengths, and the option to convert to permanent coverage if you need to.
We’re less impressed with Transamerica’s whole life insurance. Death benefits only range between $2,000 and $50,000, which is a fairly limited scope when compared to other top companies. (For example, New York Life’s whole life policies max out in the tens of millions). If you’re shopping for a permanent policy, try starting with our picks for the best whole life insurance or the best guaranteed universal life insurance instead.
Is Transamerica life insurance available everywhere?
Yes. Transamerica writes life insurance in all 50 states, although its Trendsetter LB policy is not available in New York.
What is Transamerica FFIUL?
FFIUL is Transamerica’s Financial Fund Index Universal Life. This is a type of permanent life insurance policy. It offers flexible premiums and a guaranteed death benefit, with part of your policy’s cash value going into an interest-earning index fund.
The merits of index life insurance are debated: growth can be aggressive, but it’s also subject to volatile markets, and fees tend to be high. Whatever your stance, we recommend caution when considering Transamerica FFIUL. These policies draw a high volume of customer complaints, and the company has even been sued for raising prices on active accounts.
The Bottom Line
If you’re shopping for term insurance, get a quote from Transamerica. It offers a great range of policy sizes and term lengths, and it’s likely to be affordable. If you’re in the market for permanent insurance, on the other hand, we recommend looking elsewhere. Transamerica’s offerings are much more limited in that department.