Progressive not only offers auto insurance, but life insurance as well. Learn more in our Progressive Life Insurance Review.
When it comes to the top auto insurance companies in the United States, Progressive is undoubtedly near the top of the list. However, while all of the commercials and ads are for auto and motorcycle coverage, the company does offer a wide array of policies, from renters insurance to life insurance.
One of the best ways to ensure that you’re buying the right policy for your needs is to compare options and pricing. Although Progressive has a slick marketing campaign, how does it stack up for life insurance? We’ve done the research, and here is what you need to know.
Progressive Company History
Many insurance companies in the U.S. have long and prestigious histories, with multiple brands getting their start before the turn of the 20th century. By comparison, Progressive is relatively young, although it has been in business for almost 100 years.
Two lawyers founded the company in 1937, and one of their first notable advantages was a drive-in claims location. They were the first to do this, and many other companies followed suit.
Another mark of innovation from Progressive came in the form of its Safe Driver Plan. Rather than charge the same rates for all drivers, the company decided to lower premiums for those without accidents. While this concept is widespread today, it was revolutionary in 1956 when the plan was introduced.
Today, Progressive has over 27,000 employees around the world and manages over 13 million policies. The company has over $23 billion in assets, making it one of the world’s top insurance carriers.
One excellent way to tell the strength and reliability of an insurance company is to check its credit rating. As expected, Progressive excels in this area, with high rankings from the top credit agencies.
The company has an AA rating from Standard and Poor, A+ Superior from A.M. Best and an Aa2 rating from Moody’s. Overall, you can’t do much better than Progressive if you want to buy insurance.
Efinancial vs. Progressive
While Progressive’s impressive history and credentials make it an excellent option for home and auto insurance, there is a catch when buying a life insurance policy. As with many other high-profile companies, Progressive doesn’t underwrite these plans, instead using a third-party company called Efinancial.
What is even more interesting is that Efinancial doesn’t do any underwriting itself either. Instead, it sources life insurance policies from the following four companies:
- Fidelity Life
- Prudential Life
- Protective Life
In that regard, Efinancial is more of an aggregator than an insurance company. However, it doesn’t pull from as many sites as other aggregators – only these four. While these are some high-quality life insurance carriers, they are not always the most affordable, nor do they have the most varied plan options.
Overall, when searching for life insurance through Progressive, be aware that they will not hold your policy. For that reason, it may be better to use a different aggregator website to compare more rates and plans to find one to fit your needs (check out our free aggregator here).
Types of Life Insurance Offered
When you search for life insurance through Progressive, you will be asked about the type of policy you want. There are three primary options available: term life insurance, whole, and universal. Here is a breakdown of what you can expect when searching through these plans.
Term Life Insurance
As the simplest form of life insurance, term policies are the easiest to understand and the cheapest option available. Through Efinancial, you can find plans that will last between 10 and 30 years, with a death benefit of up to $1 million.
To qualify, you have to be between 18 and 80, and you will have to provide answers to basic medical questions. Not all term insurance policies require an in-person exam, but some do, so be aware of that.
One of the most significant downsides of searching for a policy through Efinancial is that it doesn’t provide you with a list of table rates. Typically, insurance companies will generate monthly premiums based on your age, gender and health status (i.e., smoker or non-smoker). While these rates are not always precise, they will give you some idea of what you can expect to pay when signing up for a plan.
On the low end, you can expect to pay as little as $14 per month. The elements that will inflate your price include:
The minimum benefit you can receive is $50,000, but some policies will go up to $1 million. One thing to keep in mind is that your age and income level can limit your benefit size.
For example, if you’re between 18 and 40, you can get up to 30 times your annual income. If you’re between 41 and 50, that number shrinks to 20 times, and then 15 times for individuals between 51 and 60.
So, the longer you wait to purchase a policy, the less money your loved ones can receive. However, given that you might not have as many financial responsibilities at an older age, this might not be an issue.
Because smoking is such a health hazard, insurance companies will view you as a higher risk, regardless of your age. The upside, however, is that smoking rarely prevents you from getting approved for a policy. Instead, you will just pay higher monthly rates.
One thing to consider when purchasing term life insurance is that your premiums will stay constant for the life of the policy. So, if you purchase a 20-year plan and quit smoking in five years, you will still pay smoker rates for the remaining 15 unless you cancel your policy and buy a new one.
One thing you’ll notice when looking at life insurance tables is that gender can affect your rates. As a rule, women tend to live longer and be lower risk than men, so they pay less for insurance. The disparity varies between companies, but women can expect to pay roughly 25 to 40 percent less than men, depending on age.
As we mentioned, Efinancial offers term policies that last from 10 to 30 years. The longer your term, the more you will pay for coverage. Keep in mind that you can often renew your policy when it expires, but you will receive an updated rate based on your age and health status. For example, if you purchase a 20-year policy at age 30 for $20 per month, you could expect to pay twice as much when getting a renewal at age 50.
While life insurance itself is a valuable asset, you can make it even better with riders. Efinancial doesn’t provide information about these add-ons on their site, but you can look into it more by checking out the insurance companies directly (i.e., Prudential Life). Some standard riders include:
- Accidental Death and Dismemberment – If you lose a limb, you can receive a partial payment from your death benefit. If you die due to an accident, your beneficiaries will receive extra money.
- Terminal Illness – Fighting diseases like cancer or AIDS can be costly. With a terminal illness rider, you can claim some or all of your death benefit while you’re still alive to help pay for medical bills.
- Child Rider – Although you can’t purchase a policy on a minor directly, you can add coverage to an existing plan. These riders can be converted to traditional life insurance once your child turns 18.
Depending on the company, these riders may incur additional costs or be free to add. In most cases, accidental death and dismemberment (AD&D) is free, but the other options will inflate your monthly premium.
Because term insurance doesn’t build value (meaning that once it expires, you receive nothing), most plans don’t require an in-person medical exam. All you have to do is answer a few questions to allow the underwriters to assess your risk level.
For example, if you currently have cancer or another terminal illness, your options will be significantly limited. Typically, you will only be able to purchase guaranteed acceptance burial insurance, which comes with a two-year waiting period and higher costs.
Whole Life Insurance
While term insurance is cost-effective, it does expire, which can be a disadvantage. If you want to maintain coverage forever, you will need to purchase whole life insurance. Rather than choosing a period (i.e., 20 years), your plan will stay in effect for as long as you keep making payments.
When searching for whole life insurance through Efinancial, you’ll notice these benefits:
With some insurance companies, you can expect to pay more for whole life insurance as you get older. In these instances, your rates will increase every two to five years.
Fortunately, when purchasing through Efinancial, your premiums will stay constant forever. So, the earlier you get coverage, the less you’ll pay later in life.
Zero Additional Cost Policy
One of the primary advantages of buying whole life insurance is that you can build equity within your plan. A small segment of your monthly payment goes toward a cash value portion (CV), which accumulates over time.
There are several ways to leverage your CV, including paying off premiums later in life. For example, if you want to maintain coverage during retirement, you can use your CV instead of paying out of pocket. In this case, you’re essentially getting “free” coverage for as long as your account balance remains solvent.
Cash Value Loans
Another advantage of building a CV is that you can borrow against it for various reasons, such as purchasing a home. The best thing about this tactic is that you’re repaying yourself when you pay the money back. This strategy is known as infinite banking, and it can allow you to accrue wealth over time.
Universal Life Insurance
Because whole life insurance policies grow tax-free, some people want to take advantage of that as much as possible. If you’re going to leverage your CV as an investment strategy, you should purchase universal life insurance. This is a form of whole insurance, with a few extra advantages, including:
- Adjustable Cash Value Payment – Rather than paying a fixed premium forever, you can add more money to your CV or reduce your payments as you see fit. This tactic allows you to build the account faster.
- Indexed Funds – Instead of building small amounts of interest, you can invest your CV into an index fund. This allows you to grow wealth faster through the stock market.
Pros and Cons of Progressive Life Insurance
Overall, there are no unique advantages of purchasing life insurance through Progressive or Efinancial. However, here are some of the pros and cons you can expect if you decide to get a policy.
- Excellent Customer Service
- Strong Company Reputation and Reliability
- Easy to Use Platform
- Relatively Low Rates
- Limited Selection
- Rates May Be Lower Through Other Companies
- Progressive or Efinancial Does Not Underwrite Policies.
- Rates Are Not Provided Upfront
Bottom Line: Is Progressive Life Insurance Worth It?
If you’re looking for a quick and easy way to get coverage for your loved ones, then it might be worth it to use Progressive as a jumping-off point. However, because life insurance is such a valuable asset, it helps to take time to compare plans in detail. Why pay more for coverage if you don’t have to?
Contact NextGen Life Insurance Today
At NextGen Life Insurance, we make it easy to find the right policy for your needs. Let us do the hard work of comparing plans and rates so that you can spend more time worrying about what matters most.
We’ll help you decide which policy elements are most valuable for your situation and ensure that you get a rate that matches your budget. No matter what your goals are, we can make them a reality. Get your free quote today to find out more.