Transamerica Life Insurance Review (Coverage Comparisons & More)

If you have loved ones who depend on you financially, purchasing a life insurance policy could be one of the most important things you do for them. With that fact comes a lot of pressure to choose the right policy.

The life insurance market is a large one, with plenty of companies offering a myriad of policy options that each serve a different purpose. It can be a challenge to sort through all of them.

Transamerica is one of the largest life insurers in the country, backed by an even larger global firm. They have been providing families life insurance coverage since 1928.

They don’t offer quite as many coverage options as some competitors, but the plans they do have could suit your needs.

This extensive review is designed to give you a complete overview of the company and preview all of their policies to help you decide if Transamerica is the life insurer for you.

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Transamerica’s Ratings

The following third-party ratings give insight into Transamerica’s financial strength, business practices, and quality of customer service.

A.M. Best

A.M. Best ratings measure an insurer’s financial strength and its ability to pay all of its policy obligations. Transamerica has an A rating, meaning they have an excellent ability to meet their financial commitments.

Better Business Bureau (BBB)

The Better Business Bureau assigns one of 13 letter grades based on factors such as time in business, open complaints, resolved complaints, and federal action against a company. Transamerica currently holds an excellent A- rating.

Moody’s

Similar to A.M. Best, Moody’s long-term obligation ratings measure an insurer’s credit risk. Transamerica holds an upper-mid-grade rating of A1, representing a low credit risk.

Standard & Poor’s (S&P)

S&P (Standard & Poor’s) ratings also measure an insurer’s credit risk. Transamerica earned a very strong AA- rating, the fourth-highest of 21 overall scores.

NAIC Complaint Index

The National Association of Insurance Commissioners Complaint Index compares the number of complaints registered against an insurer each year with that of other companies.

The NAIC sets the index at an average score of 1.00. Transamerica has a current score of 1.30, somewhat higher than the industry standard.

J.D. Power

J.D. Power’s annual U.S. Life Insurance Study measures overall customer satisfaction in four areas: annual statement and billing, customer interaction, policy offerings, and price.

Transamerica scored two out of five in the 2018 study. Its highest individual score (three out of five) came in the area of customer interaction.

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Company History

Here’s a look at Transamerica’s story in their own words.

Transamerica’s story begins in 1904 when Amadeo Giannini founded the Bank of Italy in San Francisco to serve small merchants and immigrant farmers. In 1928, he consolidated the bank into what would eventually become Bank of America, and by 1946 it was the largest private bank in the world.

During that time, it acquired the Occidental Life Insurance Company through the newly created holding company, Transamerica Corporation. When the Bank Holding Company Act of 1956 forced Transamerica to divest either its bank or on-bank investments, it chose to divest banking and focus solely on insurance.

In 1999, Transamerica was acquired by global financial services company Aegon, which currently serves over 13 million customers in the United States and employs nearly 30,000 people worldwide.

Today, Transamerica sells insurance life insurance through three subsidiaries:

• Transamerica Life Insurance Company
• Transamerica Financial Life Insurance Company
• Transamerica Premier Life Insurance Company

Transamerica Life Insurance Company sells policies in all states but New York. Transamerica Financial sells in all states, including New York. Transamerica Premier sells in all 50 states, Guam, and Puerto Rico.

Transamerica’s Market Share

In 2018, Transamerica held a 3.6 percent market share of all individual life insurance business in the country, representing $4,567,999,000 in direct written premiums.

From 2015-2017, Transamerica rose two spots from the ninth- to the seventh-largest writer of individual life insurance policies, increasing their market share from 3.4 percent to 3.5 percent.

In 2018, their market share increased again to 3.6 percent, but their overall rank dropped to eighth place due to having written about $26 million less in premiums than the closest competitor State Farm.

There is a very small margin of only a few million dollars separating the insurers in the #6 (John Hancock), #7 (State Farm), and #8 (Transamerica) positions, with each holding a 3.6 percent market share.

Transamerica’s Position for the Future

Transamerica has experienced a steady increase in market share over the past four years. During that time, they have written approximately $422,000,000 in new premiums.

The only reason their ranking has fluctuated and not seen the same increase is all of the close competition in that 3.60 percent market share range.

Transamerica may trade market share positions with State Farm and John Hancock for the next few years, but there is no reason to think they won’t remain a top-10 insurer for the foreseeable future.

It’s also worth noting that former top-three insurer MetLife has stopped selling individual life insurance policies. Depending on where that business ultimately goes, Transamerica could increase its market share even further.

Transamerica’s Online Presence

Transamerica offers the ability to pay bills, file a life insurance claim, request a quote, and apply through its website.

Currently, you can only request an online quote for the high-value Trendsetter® Super term policy. For all others, or to apply for a policy, you must contact an agent.

Transamerica in the Community

Transamerica is committed to giving back to the communities in which it operates. It does so through the following initiatives:

Corporate Giving:

The Aegon Transamerica Foundation regularly awards grants to local non-profit organizations in six areas. Last year, their total giving in those areas is as follows:

• Arts and Culture: $670,969
• Civic and Community: $1,562,887
• Education and Financial Literacy: $1,819,557
• Health and Wellness: $1,669,335
• Human Services: $1,122,122
• United Way: $623, 780

Grant applications are available on the Transamerica website.

Habitat for Humanity:

Transamerica encourages employees to volunteer with Habitat for Humanity, providing them with the time necessary to do so. Last year, they also sponsored a complete house build, from start to finish.

Junior Achievement:

The non-profit organization Junior Achievement promotes work readiness, entrepreneurship, and financial literacy skills through a large number of K-12 programs to students across the country.

Transamerica is the title sponsor of Junior Achievement’s Finance Park program. Finance Park is a month-long program that introduces students to personal financial planning and career exploration.

At the culmination of the program, students visit a realistic on-site or virtual community and put into practice what they’ve learned by developing and committing to a personal budget.

Transamerica’s Employees

Transamerica currently employs nearly 6,500 people nationwide.

Overall, Glassdoor employee reviews for Transamerica average 3.1 out of five stars based on 1,044 reviews. Only 44 percent of current employees say they would recommend the job to a friend.

In the past, Transamerica has ranked on Forbes America’s Best Employers list but hasn’t made the cut since 2016. However, they have been named one of Best Places to Work for LGBT Equality, earning a perfect score of 100 percent on the Human Rights Campaign Corporate Equality Index.

Shopping for Life Insurance

If you’re reading this guide, it’s likely that you’ve already realized the importance of owning a life insurance policy. If you’re still on the fence, consider this.

According to the 2018 Insurance Barometer Study from Life Happens and LIMRA:

• 35 percent of households would be financially impacted within one month of the primary wage earner’s death
• 90 percent agree that the primary wage earner should carry insurance
• 60 percent of all people living in the United States have life insurance
• 20 percent of those with a policy feel their coverage is insufficient

If you’re one of those without a policy or one whose policy might be lacking, here are some key things to keep in mind as you shop. In general, life insurance needs to cover two types of obligations: immediate and future.

Immediate obligations are the things that need to be paid soon after your death. These include:

• Funeral costs
• Medical bills
• Mortgage balances
• Personal loans
• Credit card debt

Future obligations are all of the expenses (either planned or unexpected) that you want to pay for after your death. They include:

• Income replacement
• Spouse’s retirement
• Emergency savings fund
• Children’s college tuition

A life insurance agent or financial planner can help you determine exactly how much coverage you’ll need to cover all of those obligations. For now, here is an example using a basic life insurance calculator.

A husband and father of two is the majority wage earner for his family, with an annual salary of $60,000. His wife also works fulltime. The family has a remaining mortgage balance of $40,000. They also have $5,000 in outstanding credit card debt and a $5,000 remaining balance on a car loan.

The mortgage is the most significant annual expense. Once it is paid off, the wife will need less overall income. Therefore, he plans to leave only five years’ worth of his salary as an emergency fund.

He would also like to establish a college fund of $25,000 for each child. After factoring in an average funeral cost of around $7,500, his insurance needs are as follows:

• Immediate: $40,000 mortgage + $5,000 credit card + $5,000 car loan + $7,500 funeral costs = $17,500
• Future: $300,000 income replacement + $50,000 college fund = $350,000
• Total: $407,500

That total means he would need a life insurance policy with a face value of at least $400,000.

Average Transamerica Male vs Female Life Insurance Rates

The following table illustrates how Transamerica’s average rates for males and females in key demographics compare to the average of the top 10 insurers by market share.

Coverage Offered

Transamerica offers a moderate selection of term and permanent life insurance policies to suit your financial needs. You can also choose from several riders to further tailor your policy.

Types of Coverage Offered

Life insurance policies fall into one of two general categories, term or whole. Term policies only pay if the death occurs within a set time frame, usually between 10-30 years.

Whole policies have no term and pay whenever a death occurs, regardless of age. Many also build cash value by allocating a portion of your premiums into an interest-bearing account.

They can also come with two benefit options: level (or fixed) and increasing.

With a fixed death benefit, the policy premiums decrease over time as the cash value increases so that the payout is always equal to the initial face value. With an increasing death benefit, the premiums and face value remain the same over time. As the cash value increases, the overall death benefit increases.

Whole policies have multiple variations: traditional whole life, universal life, guaranteed universal life, indexed universal life, and variable universal life.

Transamerica currently offers term, traditional whole, and indexed universal policies.

Term

A term policy is payable only if the death of the insured occurs within a specified period or before a specified age.

Once the term has passed, the insurer cancels the coverage. There are generally no refunds on the premiums paid. Some policies can also be converted to a whole policy before it expires.

Transamerica offers two different term policies with details as follows.

Trendsetter® Super:

• Term: 10-30 years (in five-year increments)
• Convertibility: Convertible before end of the initial level premium period or until age 70 (whichever comes first)
• Minimum: $25,000
• Maximum: $10,000,000 (and above based on individual consideration)
• Issue Age: 18-80

Trendsetter® LB:

• Term: 10-30 years (in five-year increments)
• Convertibility: Convertible before end of the initial level premium period or until age 70 (whichever comes first)
• Minimum: $25,000
• Maximum: $2,000,000
• Issue Age: 18-80

The Trendsetter® LB plan includes built-in living benefits that allow the insured to access up to 24 percent of the face amount every year if diagnosed as not being able to perform activities of daily living for periods of 90 days or more.

Whole

A traditional whole life policy (sometimes called ordinary life) is the most common form of permanent insurance. A portion of your annual premiums is placed in an account that grows at a fixed interest rate (typically around 3-8 percent).

The specifics of Transamerica’s whole policy are as follows.

• Flexibility: Face amount increases are not permitted; one-time decrease permitted after the eighth year
• Interest: Guaranteed 4 percent annual interest
• Minimum: $25,000
• Maximum: $3,000,000 (and above based on individual consideration)
• Issue Age: 20-80
• Death Benefit Option: Level death benefit only

Indexed Universal

Universal policies offer the permanent coverage and cash value growth of a traditional whole plan, while also allowing flexibility to set monthly premiums, change coverage amounts, and make lump-sum payments to keep premiums low while maximizing cash value.

Indexed universal life policies allow the owner to allocate the cash value amounts to an equity index account such as the S&P 500 or the Nasdaq 100, rather than growing at a rate set by the insurer.

The specifics of Transamerica’s whole policy are as follows.

• Flexibility: Face amount increases are permitted, but subject to fees
• Interest: Guaranteed 0.75 percent interest in index accounts; 2 percent in a basic interest account
• Minimum: $25,000
• Maximum: $3,000,000 (and above based on individual consideration)
• Issue Age: 20-80
• Death Benefit Option: Level or Increasing

Burial & Final Expense

Burial and final expense policies are whole life policies with low face values meant only to cover funeral expenses and perhaps some small financial obligations such as an outstanding personal loan.

Your payments never go up, and your coverage never goes down. There is no cash value element. Face values typically range from $2,000-$25,000.

The details on Transamerica’s final expense policy is as follows.

• Minimum: $2,000
• Maximum: $50,000
• Issue Age: 0-80

This policy has three payment options:

• Immediate solution: Level premiums to age 121 (after which the policy endows)
• 10-pay solution: Higher level premiums for 10 years, then coverage until age 121
• Easy pay solution: Level premiums to age 121, with limited death benefits until the policy matures

Riders

Riders can be added to each policy to customize your coverage further. Transamerica offers the following:

• Child Protection Rider: Provides life insurance coverage for all eligible children
• Disability Waiver of Premium Rider: If you become disabled, your premiums will be waived for the duration of the disability or to the end of the policy term
• Accelerated Death Benefit Rider: If you’ve been diagnosed with a terminal illness with less than six months to live, you can access up a portion of the policy death benefit up to a set maximum
• Accidental Death Benefit Rider: Pays an additional death benefit on top of the base policy’s death benefit if the death resulted from qualifying accidental injuries

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Factors That Affect Your Rate

Anything that increases your risk of an early death increases the chances the insurer will have to pay out on your policy. That higher your risk classification, the higher premiums they charge.

Let’s take a look at some of the most common factors that affect your rate.

Demographic

Several demographics can have a big impact on your life insurance premium.

Age: Age is one of the most important factors in determining insurability. It is rightly assumed that the older you are, the closer you are to dying. You can expect your rate to climb higher with each year you wait to purchase a policy. Some insurers also limit coverage amounts for people over certain ages.

Gender: Gender also plays a key role. Statistically, women live longer than men. For that reason, men in the same risk classification will almost always pay higher premiums than women.

Marital status: Marital status doesn’t directly influence your premium, but it could indirectly increase it. A marriage most often comes with more financial responsibilities. A married individual typically has more future obligations (spousal support, children’s tuition, etc.) than a single individual.

That higher coverage translates to higher premiums.

Current Health & Family Medical History

Healthy people have a longer life expectancy, which leads to lower premiums.

To determine your overall health, insurers will require you to fill out a health questionnaire and may request access to your medical record. Some may require a complete medical exam and bloodwork.

Even if a policy does not require a medical exam, underwriters still have access to public prescription and Medical Information Bureau (MIB) records.

Therefore, it’s important to be honest on the questionnaire.

Most insurers will also examine the health history of your immediate family to identify any potential hereditary medical issues.

High-Risk Occupations

Some jobs are more dangerous than others.

The Bureau of Labor Statistics’ Census of Fatal Occupational Injuries shows police officers, firefighters, and many others have a higher risk of accidental death than someone with an office job.

A dangerous job will earn you a higher risk classification, which means higher premiums.

High-Risk Habits

Similarly, high-risk habits outside of work can also result in costlier life insurance.

The most common high-risk habit that insurers look for is tobacco use. Smokers almost universally pay higher rates than their non-smoking counterparts in every demographic. For example, at Transamerica, a 30-year-old male non-smoker pays around $165 per year for a 30-year, $100,000 policy. A 30-year-old smoker pays $355 for the same policy.

That’s an extra $5,700 paid over the life of the plan.

In addition to smoking, insurers will also ask about any other high-risk hobbies, such as mountain climbing, flying, or any other regular activity that has a high potential for injury.

A single experience isn’t going to change your risk classification, but a regular, on-going high-risk hobby could.

Veteran or Active Military Status

Military status falls under the category of high-risk occupations. Most insurers charge higher rates to active duty military service members, and some don’t sell them policies at all.

Getting the Best Rate with Transamerica

Your risk classification determines whether an insurer will raise your price from their base premiums. Those base premiums are generally based on three factors: mortality, interest, and company expenses.

Insurers use statistical mortality tables to estimate how many people in each demographic they insure are likely to die each year. They will raise rates to minimize their losses based on that data.

Rates are also influenced by current interest rates. Insurers increase their profits by investing the premiums you pay in bonds, stocks, mortgages, etc. If they expect a lower return on those investments, insurance premiums may rise.

A company’s operating expenses also play a key role.

The more a company spends servicing its policies, the more they’ll charge for them. Rates can also vary from state-to-state, though the NAIC is currently encouraging states to adopt laws that would provide more uniformity nationwide.

With so many variables at play, what can you do to get the best rates? You don’t have any say in gender, family medical history, or several demographic factors, but there are some variables within your control.

First, stay healthy. If you’re not already, make some lifestyle changes to help get you there. Improve your diet. Start exercising. Monitor your blood pressure and cholesterol. Do whatever you can to tip the proverbial scales in your favor on a medical exam.

If you do smoke, not only is it important to quit, it’s important to quit as soon as you can. Some insurers require you to be tobacco-free a certain amount of time before you can claim a non-smoking rate.

Second, buy early. As discussed, every year you wait to buy a policy is going to result in a higher rate.

For example, a 30-year, $100,000 policy with Transamerica for a 25-year-old male non-smoker is quoted at $165 per year. That same policy for a 45-year-old costs $328. That 20-year jump represents an increase of $4,890 over the life of the policy.

Finally, it’s important to pay your premiums on time. Like any bill, late payments result in penalties and could even lead to the cancellation of your policy. If you have a policy canceled for non-payment, you can expect additional fees to get it reinstated or higher rates at the next insurer.

To give you an idea of how much a term life policy might cost, we’ve compiled a list of monthly sample rates for a 10-Year Term for non-smokers at key ages.

Transamerica’s Programs

Transamerica offers little in the way of additional life insurance resources outside of a blog on their website. The blog covers a wide range of insurance and financial topics and is updated regularly.

If you have a life insurance question, you may find the answers there. However, there are more thorough, dedicated resources elsewhere that might serve you better.

Canceling Your Policy

Some of Transamerica’s plans allow you to adjust your coverage if your financial situation changes during the course of your policy. If you do need to cancel your policy completely, you can do so at any time, though early termination of some term plans could result in penalties.

There are a few instances when you would receive a refund after canceling a life insurance policy with Transamerica. For a term policy, you will only be refunded any premiums you pre-paid for an upcoming period.

For a universal policy, you will be refunded any prepaid premiums as well as the surrender value of your policy. The surrender value is the cash value of your policy minus any surrender fees.

How to Cancel

The only way to cancel your policy is through your life insurance agent or by requesting a cancellation form from customer support. The form will need to be filled out and submitted either electronically or via mail.

Customer support can be reached through your client account portal or by phone at 1-800-797-2643.

How to Make a Claim

The overall process of filing a death benefit claim with Transamerica follows general industry-standard steps:

• Initiate a claim
• Fill out company-specific paperwork
• Submit the paperwork along with a death certificate and any other requested documents
• Choose a disbursement method
• Receive the benefits

With Transamerica, you can initiate a claim online or over the phone.

• Online: First Report of Death Claim Form
• Phone: 1-800-251-7254

Upon initiating a claim, you must provide a policy number, the insured’s date of death, and a death certificate. If the insurer requires any other documentation, it will be listed in the claim package.

How to Get a Quote Online

It’s simple to get an online quote for a term policy from Transamerica. All you’ll need to do is head to the quote tool and enter some basic information.

#1 – Go to the Term Insurance Page

From the homepage, go to the individual life insurance page using the menu bar in the top left of the page. From there, select the option for term insurance.

#2 – Go to the Quote Tool

At the bottom of the term insurance page, select the option to get a quote online.

You’ll be taken to the quote tool.

#3 – Enter Your Information

Enter your personal and contact information into the required fields.

#4 – Get Your Quote & Contact an Agent

Once you submit your information, the tool will display quotes for 10- through 30-year term policies. You’ll then have the option to contact an agent directly from the results screen.

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Design of Website/App

The Transamerica website is easily navigated, but a little scarce on the information. It is mostly designed to give you an overview of their product offerings, and then guide you to an agent who will walk you through the specifics.

Transamerica does not currently have an app for managing life insurance policies.

Pros & Cons

As with any company, there are pros and cons to shopping with Transamerica. Here are some of the biggest.

Pros

• A top-10 individual life insurance provider
• Financially sound
• Online quotes
• Term and whole options
• Lower-cost final expense option

Cons

• Higher than average rates
• No variable options
• No online application
• Most policy changes must be made using paper forms

The Bottom Line

While Transamerica is one of the oldest and largest life insurance providers, their rates are often higher than those of their closest competitors. They also have limited policy options compared to those same companies.

There are numerous companies with more policies that cost less.

Where Transamerica does stand out is in its high face-value term policies. Many term policies have a maximum value of $1,000,000, where Transamerica offers face values of $3,000,000 and above (based on individual considerations).

If you need a lot of coverage for a limited amount of time, it could be worth talking to an agent about Transamerica’s offerings.

Transamerica’s FAQs

Here are some frequently asked questions about Transamerica and their policy offerings.

#1 – Does Transamerica offer a no-exam life insurance policy?

Depending on your age and health history, Transamerica may waive the medical exam on their term policies.

#2 – Does Transamerica offer any supplemental coverage?

Transamerica offers Medicare supplement plans and long-term care coverage.

#3 – How do I make a payment on my Transamerica life insurance premiums?

You can have your payments automatically debited from your checking account every month by filling out an authorization form or make electronic payments from a savings or checking account online.

#4 – How easy is it to change my beneficiary?

You will need to fill out a beneficiary change form, which can be filled and submitted directly online or by mail.

#5 – Can I make withdrawals on my Transamerica life insurance policy?

Transamerica’s indexed universal life policy allows for a partial withdrawal or partial surrender on interest accrued during specific periods. You can also take out loans against your cash value. Disbursements are made via mail after completing a dividend withdrawal form either online or by mail.

#6 – How long does it take for Transamerica to pay death benefits on a life insurance policy?

Death benefits are typically paid within 30 days of processing the completed claim packet. There could be delays if the death occurred longer than two years prior.

#7 – Are the life insurance benefits taxable?

Life insurance benefits are non-taxable when they are paid directly to a beneficiary, such as a spouse or a child. However, if you name your estate as the beneficiary, the benefits become a part of the estate and are then subject to estate taxes.

#8 – Are all Transamerica life insurance policies available in all states?

Yes. Transamerica is licensed to sell all of its policies in every state through one of its three affiliates.

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