This article will provide a thorough AIG Guaranteed Universal Life Insurance Review. AIG’s product – Secure Lifetime GUL 3 – is the main product that we will cover.
For a instant quotes from leading carriers, please use our quote engine on this page. To see Guaranteed Universal Life Insurance quotes, please select “Lifetime” under Type of Insurance. You will see most of the top carriers that offer GUL. However, not all carriers work with our quoting service.
We work with ALL the top carriers. For example, you won’t see North American even though they have a very good Guaranteed Universal Life product (you can read about North American here). Ask us for a comprehensive quote, showing all the carriers, and we’ll get that to you ASAP.
History of American International Group (AIG) – the Good and the Bad.
When we started in the insurance business in 2000, American General (a subsidiary of AIG) was one of the top carriers in the life insurance business. They were one of our primary carriers for 15, 20 and 30 year term life, because they had very competitive rates and maintained an A++ rating by AM Best. That was impressive.
From 2000 to 2008, many agents in our office purchased term insurance for themselves through American General. In 2008, during the financial crisis our country experienced, AIG received a black-eye due to the government bailout and the issues surrounding that event. The Federal Reserve provided AIG with a 2-year loan for $85 billion.
As one of the world’s largest insurance companies, they were in troubled financial waters. As a result, we stopped offering American General and all of AIG’s insurance products. With so much uncertainty regarding the future of AIG, we were reluctant to take any chances with our clients.
AIG is a resilient company. With a history that dates back to their founding in 1919, AIG has weathered many economic storms. They bounced back, restructured in 2012 and they are in good financial shape today. We have kept a close watch on AIG and their product offerings and feel confident that they have very good term life plans and a competitive Guaranteed Universal Life product.
The Financial Ratings of AIG
AIG Life has the following ratings:
- AM Best: A (3rd best)
- Standard & Poor’s: A+ (5th best)
- Moody’s A2 (6th best)
- Comdex Score: 80 (compares overall financial rating to all other carriers).
We are not thrilled with AIGs Comdex score, as the ranking of ’80’ is relatively low. However, their Guaranteed Universal Life insurance, as well as their term life plans, are guaranteed. There are no “moving parts” that could change due to market volatility or the carrier’s financial setback (lowered ratings, etc.).
There has never been a life insurance company that has not paid a death benefit in the history of the US. However, there have been many insurance companies that have raised internal life insurance costs and fees due to poor returns on their investments. With products like term insurance and GUL, this becomes a non-issue.
AIG’s Guaranteed Universal Life Products:
- Secure Lifetime GUL 3®
The Secure Life GUL 3 is their flagship GUL product. With a simple design and the option to guarantee level premium from age 90 to 121, this product is a basic and competitively priced GUL.
- AG Secure Survivor GUL II®
This product is a Second to Die policy and provides they same guarantees as the Secure Lifetime GUL 3. The purpose of this product is to minimize taxes and should be a part of an estate planning process. The guaranteed death benefit with this product is no different than other guaranteed universal life policies.
Features of AIG’s Secure Lifetime GUL 3
- Guaranteed Return of Premium: One of the features of this product that make it different is the “return of premium” provision. AIG guarantees a return of premium in Year 20 (at 50%) or Year 25 (at 100%). Most people purchase this product with the intention of keeping it their entire lives, but circumstances can change.
- Guaranteed death benefit protection
- Guaranteed minimum cash value
- Pro-rata adjustments on partial withdrawals This policy is not designed to accumulate cash value, but it certainly can build cash value. This provision allows the policy to remain in force with a proportionally reduced death benefit and cash values while maintaining the guarantees.
- Issue age up to age 80
Riders of AIG’s Secure Lifetime GUL 3
- Waiver of monthly deduction – policy payments stop for base policy and riders as long as policy owner meets the chronic illness requirement
- Accelerated Access Solution – this is a chronic illness benefit that allows the insured to access a portion of the death benefit due to a qualifying chronic illness. However, this benefit is available for additional premium. Some carriers offer this benefit at no extra cost (United of Omaha, Principal Life, and a few others).
- No receipts required – benefits paid on the chronic illness benefit irrespective of actual costs incurred
- No waiting period – benefits for the chronic illness rider are available as soon as policy is issued, following a 90 day elimination period
- Waiver of Premium – in the event of a disability
- Children’s term life rider
A Scenario where AIG’s Guaranteed Universal Life (GUL 3) works well
Let’s look at a 45 year old female named Alex. Alex is divorced and has two children in their early teens. Her youngest child is severely autistic, so she knows she will be dependent on care by others her entire life. She can’t rely on her ex-husband to provide for her daughter because he carries very little life insurance and is in poor health.
So, Alex likes the idea that her daughter’s caregiver (or a Trust) would receive a tax-free death benefit regardless of when Alex dies. She also likes the idea that should circumstances change (such as her daughter pre-deceasing her), she could receive all her premiums back after 25 years.
Every Situation is Different
Sometimes a guaranteed universal life insurance policy can be a good solution – or a part of the solution – to provide protection to loved ones. Since everyone has different needs and desires, we are glad to help you find the best plan for your situation. Please call or email us and we’ll be glad to help. 678-236-1600