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AAA Life Insurance Review
By Kat Tretina MONEY RESEARCH COLLECTIVE
The American Automobile Association (AAA) is a well-known national brand, made up of member auto clubs nationwide. If you’re an AAA member and have had a good experience with the organization’s roadside assistance offerings, you may be considering getting a life insurance policy through AAA Life Insurance Company.
Through AAA, you can purchase term, whole or universal life insurance coverage, and the company sells optional riders you can use to customize your policy or purchase additional coverage.
But AAA Life Insurance does have some limitations, so continue reading to learn if its policies are the best life insurance for you.
Table of contents
- AAA Life Insurance Company overview
- AAA’s services
- What it offers
- AAA’s credentials
- AAA’s accessibility
- AAA’s customer satisfaction
- AAA vs. the competition
- AAA life insurance FAQs
- How we evaluated AAA life insurance
- Summary of Miami Herald’s AAA review
AAA Life Insurance Company overview
The AAA Life Insurance Company became part of AAA in 1969. As of 2022, it has over 1.5 million active life insurance policies, and it issues policies in all states with the exception of New York.
Although AAA membership is typically required for if you want to buy AAA products like car insurance, that’s not the case for most of the policies sold by the AAA Life Insurance Company. Even if you don’t have an AAA membership, you are eligible to buy term, whole or universal life coverage through the company.
AAA’s life insurance products
Through the AAA Life Insurance Company, you can purchase permanent or term life insurance. AAA life insurance options range from basic policies that can cover burial expenses to more substantial forms of coverage that can provide lasting financial protection for your family.
What it offers
Depending on your needs and budget, you can purchase the following life insurance products through AAA:
Term life insurance
Term life insurance is temporary, lasting for only the policy term. With AAA, available term lengths are 10, 15, 20 or 30 years. Your beneficiaries only receive a death benefit if — and only if — you die within the policy’s term.
AAA term life insurance has two options:
- ExpressTerm Life: This term life insurance policy allows you to buy up to $500,000 in term life coverage online. You might have to answer some health questions, but qualifying applicants don’t need to have a medical exam.
- Traditional Term Life: Traditional term life insurance requires a medical exam, but it allows you to get up to $5 million in coverage. To purchase AAA traditional term life insurance, you must work with an insurance agent.
Whole life insurance
Unlike term life insurance, whole life coverage is a type of permanent life insurance, as in coverage that lasts for your lifetime. As you pay your premiums, your whole life insurance policy can also build cash value.
AAA offers two whole life options:
- Guaranteed Issue Whole Life: If you are between the ages of 45 and 85, you cannot be denied for this coverage option. You can get up to $25,000 of coverage, regardless of your medical history.
- Whole Life: The whole life option is traditionally underwritten, so you must pass a medical exam. The maximum amount of coverage available is $75,000.
AAA’s whole life policies have relatively small death benefits, so they’re best for those looking for insurance that will cover their funeral and burial costs, otherwise known as final expense coverage.
Universal life insurance
Universal life insurance is another type of permanent life insurance, so it provides coverage for your entire lifetime. But these policies tend to be more flexible than whole life coverage, in that many allow you to adjust your premiums and benefits if your needs change over time.
There are two universal life insurance policy options from the AAA Life Insurance Company:
- LifeTime Universal Life: Even if interest rates change, this option provides guaranteed level premiums.
- Accumulator Universal Life: This option has the potential for more cash value growth and provides customizable premiums.
Universal life coverage starts at $100,000 and goes up to over $5 million.
Accident insurance
Unlike the other life insurance options from AAA, AAA’s Member Loyalty Accident Insurance is only available to AAA members. This is different from ordinary auto insurance. Accidental death insurance pays benefits for loss of life in an accident, as well as for expenses such as emergency room visits, hospital stays and recuperation from covered accidents.
Insurance riders
AAA has several insurance riders you can add to your policy to customize your term, whole or universal life coverage. AAA’s life insurance riders vary by policy, but generally include the following options:
- Child term rider: This rider provides coverage for a minor dependent child.
- Accelerated death benefit: If you have a terminal illness, this rider allows you to use some of your policy’s death benefit while you’re living.
- Disability waiver of premium: If you become permanently disabled, your premiums are waived and your policy stays in effect if you added this rider to your policy.
- Travel accident: Available on whole life policies, travel accident insurance provides an additional payout to your beneficiaries if you die in a covered travel accident.
What it doesn’t offer
Although AAA offers several policy options, there are some limitations to keep in mind if you’re shopping for life insurance.
If you’re interested in whole life insurance, the maximum amount of coverage available is just $75,000, which may be too low for most families.
Most policies require you to work with an agent to apply for coverage, and the application process can take over a month. Even if your application is approved, it can take several weeks before your policy goes into effect. If you’re looking for immediate coverage, you will likely need to explore other options.
AAA life insurance cost
AAA allows you to get quotes for ExpressTerm Life Insurance online, but all of its other policies require you to connect with an agent to get details on life insurance rates.
For ExpressTerm Life insurance, we received the following quotes for a woman who is healthy, non-smoking and 25 years old:
| $100,000 | $250,000 | $500,000 | |
| 10 Years | $12.23 | $16.72 | $25.96 |
| 20 Years | $15.49 | $21.34 | $34.32 |
| 30 Years | $16.54 | $30.36 | $51.48 |
AAA’s insurance premiums are slightly more expensive than the industry average as reported by insurance industry organization LIMRA, but that’s to be expected for policies that use simplified underwriting to review applications.
AAA’s credentials
The AAA Life Insurance Company is a reputable insurance company.
Licenses and registrations
AAA life insurance policies are underwritten by the AAA Life Insurance Company, which is headquartered in Livonia, Michigan. The company is licensed in all states with the exception of New York.
Awards and certifications
When choosing a life insurance company, it’s important to check the company’s financial stability ratings. You want to be certain that the insurer is financially sound, since it may be decades before it needs to pay out a claim on your policy.
The AAA Life Insurance Company has an “A” (Excellent) rating from AM Best, a credit rating agency.
Regulatory or legal actions
The National Association of Insurance Commissioners (NAIC) collects the number of complaints that consumers submit to regulators about insurance companies. Comparing the number of complaints a company receives to its market share, the NAIC releases complaint ratios every year. The industry standard is 1.0.
The AAA Life Insurance Company’s complaint ratio for 2021 was 0.82, which is better than the industry complaint index. That means the company received fewer complaints than the NAIC would expect for an insurer of its size.
AAA’s accessibility
Although the AAA Life Insurance Company is connected to AAA, your local AAA motor club can’t help you with customer service issues. Instead, you have to go through the AAA Life Insurance Company’s customer service options detailed below.
Availability
The AAA Life Insurance Company is available in every state except New York. It works with insurance agents all over the country, so you can get personalized assistance. You can find a local agent with AAA’s locator tool.
Contact information
For general questions, you can email memberssvc@aaalife.com or call 888-422-7020. Customer service at that phone number is available Monday through Friday from 8:00 a.m. until 8:00 p.m. EST, and on Saturday from 11:00 a.m. until 3:00 p.m. EST.
User experience
Although AAA has information about its policies and educational tools about life insurance online, some users may be frustrated with the buying experience because only ExpressTerm coverage can be purchased online. All other policies require working one-on-one with an agent.
For those who prefer to do their own research, get life insurance quotes and apply for coverage online, that can be a disappointing drawback.
Limitations
While other insurance providers offer 24/7 customer support, AAA is more limited. Customer support isn’t available during the workweek after 8:00 p.m. EST, and it’s closed entirely on Sundays. The insurer also doesn’t have an online chat feature, an increasingly common customer support benefit that other companies provide.
AAA’s customer satisfaction
AAA is a smaller insurer compared to other companies, so it isn’t as well-known. But existing customers tend to rate the company highly.
Customer complaints
As mentioned above, AAA has a better-than-expected complaint ratio from the NAIC. And on Trustpilot, it has a TrustScore of 4.3 out of 5, which is deemed to be excellent.
Third-party ratings
As a smaller insurance company, the AAA Life Insurance Company was not included in the J.D. Power Individual Life Insurance Customer Satisfaction Study.
AAA vs. the competition
The AAA Life Insurance Company stands up well when compared to other leading insurers like Protective Life and CoreBridge Financial, formerly known as AIG. Protective Life has a higher term coverage maximum, but for most families, AAA’s maximum of $5 million for term life coverage is more than sufficient.
AAA’s ExpressTerm coverage may be more expensive than other options, so it can make sense to shop around and get quotes from other companies. If you’re willing to undergo a medical exam, a fully underwritten life insurance policy may allow you to qualify for lower premiums.
| AAA | Protective | Core | |
| Term Coverage | Up to $5 million | Up to $50 million | Up to $2 million |
| Year Terms | 10, 15, 20, or 30 years | 10 to 40 years | 10, 15, 20, 25 or 30 years |
| Types of Life Insurance | Term, Whole, Universal, Accident | Term, Whole, Universal | Term, Whole, Universal |
| AM Best | A (excellent) | A (excellent) | A (excellent) |
AAA life insurance FAQs
Below are some common questions about AAA Life Insurance:
How we evaluated AAA life insurance
To evaluate the AAA Life Insurance Company, we compared it to other leading insurers. We looked at companies’ available policies, riders, pricing, financial stability ratings and customer satisfaction compared with insurers that get the best ratings.
Summary of our AAA review
For those that know and trust the AAA brand, the AAA Life Insurance Company can be an appealing option. It offers a range of insurance products, including term and universal life coverage. And with its ExpressTerm option, you can apply for life insurance online and get coverage without a medical exam.
However, AAA isn’t available in New York, and it may be more expensive than other companies, so it’s wise to shop around before choosing an insurer.
