American Family Insurance is a large insurance company that offers simplified issue term and final expense policies, as well as whole and universal life insurance policies for all ages. It also offers other insurance including car and homeowner’s policies. While American Family Insurance offers small discounts for existing home or car insurance policyholders, term life insurance premiums are more expensive compared to other top life insurance companies.
- Pros & Cons
- Key Takeaways
Offers simplified-issue term and whole life policies (no exam required)
Multi-policy discounts for existing customers
24/7 customer service support
Can get quotes and apply online for most policies
Mobile app available
Lower coverage amounts available for term and whole life policies
No indexed or variable universal policies available
Life insurance policies are only available in 29 states
- American Family Insurance is a long-tenured insurance provider with excellent financial strength.
- American Family Insurance offers multiple types of insurance including vehicle, property, business, and umbrella policies.
- American Family Insurance offers six types of life insurance policies with several riders available.
- Year Founded 1927
- Kinds of Plans Term, whole, universal, final expense
- Number of Plans 6
- Payment Options Monthly, annual
- Official Website https://www.amfam.com/
American Family Insurance offers term, whole, universal, and final expense life insurance at discounted rates for existing customers. We researched American Family Insurance’s financial stability, policy plan options, riders, website tools, and customer service reviews to help you compare the life insurance policy options of American Family Insurance with the competition.
American Family Insurance was founded in 1927 as Farmers Mutual Automobile Insurance Company and became American Family Insurance in 1963. It is headquartered in Madison, Wisconsin, and offers auto insurance in 19 states, and it has extended its life insurance policies to cover 28 states plus Washington D.C.
American Family Insurance offers term, whole, and universal life insurance policies for all ages, including a final expense policy for seniors. There are several policy riders available as well to help add additional coverage options and flexibility to your policy. Policy quotes are available online for most policies, and many offer simplified issue applications online (no medical exam required).
Note that actual availability varies by product and state.
American Family Insurance is a mutual company, meaning it is member-owned and excess profits are paid to policyholders as annual dividends.
American Family Insurance offers six types of life insurance plans including term, whole, universal, and final expense plans. American Family Insurance also offers a life insurance calculator to determine your insurance coverage needs. Most policies can be applied for online, and many of them do not require a medical exam to qualify.
DreamSecure Simplified Term Life Insurance
DreamSecure Simplified Term Life Insurance is a simplified-issue term life offering with coverage running from 10 to 30 years and benefits ranging from $50,000 to $500,000. These policies do not require a medical exam, and qualification is determined by answering a few simple health questions.
This term policy offers level premiums and can be converted into a whole life policy at the end of the term.
DreamSecure Term Life Insurance Policies
DreamSecure Term Life Insurance is American Family Insurance’s standard term life offering with coverage running from 10 to 30 years. Coverage amounts vary based on age, health status, and other determining factors.
This term policy also offers level premiums and can be converted into a whole life policy at the end of the term.
Whole Life Insurance
American Family Insurance’s whole life offering is a permanent life insurance policy that protects the insured for a lifetime. This policy can accumulate cash value which can be borrowed against or accessed early with optional riders. American Family Insurance also pays annual dividends if there are excess profits, which can be used to accumulate more cash value or lower whole life policy premiums.
Premiums on this policy can be paid in three different ways:
- Standard: The standard policy premiums are paid until age 100 for more affordability.
- Pay to 65: Premiums are fully paid up by age 65, and protection remains for the life of the insured.
- 15 Pay: Premiums are fully paid after 15 years, and protection remains for the life of the insured.
Children’s Whole Life Insurance
American Family Insurance offers whole life insurance to children (or grandchildren) with coverage ranging from $25,000 to $75,000. As with other whole life policies, these policies can accumulate cash value which can be borrowed against or accessed early with optional riders.
Policy premiums can be paid up in 10- or 20-year time frames, after which time no more premiums are due but the policy will stay in force for a lifetime.
DreamSecure Flexible Life Insurance (Universal Policy)
The DreamSecure Flexible Life Insurance is a type of universal life insurance with flexible insurance premiums and coverage amounts. Premiums can be adjusted throughout the policy, and coverage can be added or reduced at any time.
Policies build cash value that can be borrowed against on a tax-free basis.
DreamSecure Senior Whole Life Insurance (Final Expense Policy)
American Family Insurance offers a final expense life insurance policy, designed to help cover end-of-life costs such as burial and funeral expenses. Coverage is either $10,000 or $15,000, and policies are available for applicants from age 50 to age 80.
Policies offer level premiums and are simplified-issue, meaning no medical exams are required to qualify.
American Family Insurance offers access to three riders on its life insurance policies. A rider offers additional benefits or custom coverage options to its insurance policies. Rider fees are typically billed as a small percentage of the policy premium or as a flat annual fee. Fees vary by policy, product, and options selected.
Accelerated Death Benefit Rider
This rider is added to all life insurance policies with no additional fee and allows the insured to access a portion of their death benefit if they are diagnosed with a terminal illness.
Disability Waiver of Premium Rider
If you become permanently disabled (unable to work), you may be eligible to have your premiums waived.
Children’s Benefit Rider
This rider offers whole life insurance for your natural, adopted, and stepchildren. Coverage of $15,000 can be added to any whole life policy for each child.
Customer Service: 24/7 Phone Availability
American Family Insurance offers support over the phone, email, via online chat, or in person at one of its local offices. They also have an app to access your account on your mobile device.
Customers can call American Family Insurance 24 hours a day, seven days a week at 1-833-381-1155. American Family Insurance also offers email and live online chat support from Monday-Friday 8:00 a.m. to 8:00 p.m CT.
Customer Satisfaction: Mixed Reviews
According to the National Association of Insurance Commissioners (NAIC) complaint index, American Family Insurance receives very few complaints about life insurance policies. While an average complaint score is 1.0 (the lower, the better), American Family Insurance received a 0.11 score. They have improved over their 2019 score of 0.20 and only received one formal complaint in all of 2020.
J.D. Power also ranks companies based on customer satisfaction but didn’t rank American Family Insurance’s life insurance business. But it did rank American Family Insurance 12 out of 12 auto insurance companies in the U.S. in their 2020 Auto Insurance Study for the Northwest region. American Family Insurance did receive top honors in the Southwest region but overall was below average in customer satisfaction. The J.D. Power rating is based on their application and orientation (on-boarding process), communications, interaction, price, product offerings, and statements.
While the score is below average for auto insurance customers, this may not be indicative of its life insurance customer service quality.
Financial Strength: A (Excellent)
American Family Insurance is a strong financial company with an A (Excellent) rating from AM Best. This score is based on American Family Insurance's strong balance sheet, as well as its adequate operating performance, favorable business profile, and appropriate enterprise risk management.
A high rating from AM Best gives customers assurance that their policy benefits will be paid out when they make a claim.
Cancellation Policy: Standard Free-Look Period
American Family Insurance follows the standard state free-look period for insurance policies. If a customer decides to cancel for any reason within that period, they will receive a full refund of premiums paid. The free-look period varies by state and is usually 10-30 days in length.
After the free-look period, cancellation terms vary between life insurance policies. American Family Insurance term policies can be canceled at any time, but will not provide a refund of premiums paid. Whole and universal life policy cancellations may offer a surrender cash value, but also may come with extra charges.
American Family Insurance’s cancellation fees are not publicly listed and may vary per policy.
Price of American Family Insurance: Higher Cost Term Policies
American Family Insurance premiums vary by policy but are a bit higher than most top life insurance company term policies for young, healthy applicants. The higher price may be a reflection of the simplified issue policy, which allows applicants to qualify without a medical exam.
Quotes are based on age and the answers to a short health questionnaire. Rates listed below are based on a non-smoker in good health.
|Term Life Rates|
How American Family Insurance Compares to Other Life Insurance
American Family Insurance offers life insurance policy options for every stage of life. However, there are no policies that allow customers to invest the cash value of the policy, such as an index-universal policy or a variable universal policy. Coverage is also capped at lower amounts for term life policies ($500,000). For more options, here’s how American Family Insurance compares to another larger national insurer.
American Family Insurance vs. John Hancock Life Insurance
Both American Family Insurance and John Hancock offer a variety of life insurance policies, including term, whole, and universal life policies. Both companies also offer no-exam term life insurance for young, healthy applicants. But while American Family Insurance offers discounts for existing insurance customers, John Hancock offers incentives to smokers to reduce premiums.
Here are a few of the differences between American Family Insurance and John Hancock:
- John Hancock offers life insurance for diabetics, with diabetes management and support built-in.
- American Family Insurance offers up to $75,000 in whole life insurance coverage for children and grandchildren.
- John Hancock offers rewards for healthy activities, like going for a walk or buying healthy food.
- American Family Insurance has local offices around the country, easily found using their Agent Locator tool.
While American Family Insurance offers permanent life insurance options for seniors and dependent children, smokers may benefit more from John Hancock’s Quit Smoking incentive plan, giving a significant discount on premiums for up to three years.
Read our full John Hancock Life Insurance review.
|American Family Insurance||John Hancock Life Insurance|
|Market Share||N/A||9th largest in the U.S., 2.73%|
|Number of Plans||6||14|
|Online Quotes Available?||Yes||No|
|Service Method||Email, phone, live chat, in-person||Email, phone|
|AM Best Rating||A (Excellent)||A+ (Superior)|
|Complaints Index||0.11 (excellent)||1.53 (far below average)|
American Family Insurance offers a decent selection of life insurance policies for all ages, but prices aren’t as competitive as other top insurers. It shines when it comes to its simplified-issue policies for seniors, coverage for children, and the ability to bundle policies from its other insurance offerings to save money.
American Family Insurance is a strong financial company with a long track record and has very few customer complaints overall. If you want a simple life insurance policy bundled with your auto or homeowner’s policy, American Family Insurance may be a good fit. However, if you are looking for lower-price term life insurance or more flexible policy options, you will be better off shopping around.
All of our reviews of life insurance companies are based on extensive research and analysis of each company’s offerings, customer service, financial stability, cost, and more. For each company, we compared the life insurance products offered, as well as available features, and reported customer experiences. Visit our life insurance review methodology for the full breakdown of what we evaluated for over two dozen companies.