Principal Life Insurance Review

Principal Financial is one of the more competitive life insurance companies, especially for healthy applicants at larger policy amounts.

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Overview

Principal Life Insurance Company is an A+ rated life insurance company, and part of the Principal Financial Group, founded in 1879. The company offers a variety of competitively-priced life insurance products in all 50 states. Principal is especially competitive for larger term life insurance policies.

Financial Strength

  • Founded: 1979
  • Policyholders: 600,000
  • A.M. Best: A+
  • BBB Rating: A+
  • J.D. Power: 3 of 5

Finding the best rates

Each insurer approaches health conditions differently. One insurer might ignore a heart attack from a few years ago, whereas a different insurer might rate you as a higher risk for the same thing. Here are the details of how Principal treats a variety of common health conditions from an underwriting perspective.

Pricing for health conditions

HEALTH CONDITIONPRICING
Survivor/Family HistoryExcellent
Recent Weight LossExcellent
Heart AttackGood
DiabetesGood
Sleep ApneaGood
Former Tobacco UseGood
High Blood PressureExcellent
High CholesterolExcellent
  • Excellent - Above average; company provides excellent coverage for clients with this condition.
  • Good - Spot on; company doesn’t look at this condition unfavorably in underwriting.
  • Fair - Could use some work; clients with this condition may be issued a lower health rating, and subsequently higher rates than other insurers.

Principal Company details

Principal Financial is one of the more competitive life insurance companies, especially for healthy applicants at larger policy amounts. They have fast-track underwriting (i.e., no lab tests) for the healthiest applicants in the top two underwriting classes, up to $1 million (the largest fast-track underwriting amount available on the market). The application process is also one of the more efficient ones across the top insurance companies.

How's the application process?

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Pros

  • Electronic application (Excluding NY state residents)
  • Average number of application forms
  • Faster than average application approval (15 days)
  • Fast-track process for issue-free medical history

Cons

  • Policy delivered by mail

How's the customer service?

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What you can do online

  • Changing address
  • Changing payment info

What you can't do online

  • Updating beneficiaries requires paper forms
  • Policy cancellation requires paper forms

Principal Term Life Plan Details

Common features

All term life policies offered on our site provide life coverage for a specific period of time (the term). The key features of this policy are standard across all the term policies we offer:

  • Level premium- which means the cost of the policy (the premium you pay) is fixed for the entire term of the policy. It will not increase during the term of the policy.
  • Good value- term life policies are significantly less expensive for the same amount of death benefit coverage than permanent life policies.
  • Regulated- the cost of this term life policy, for a given coverage amount and term, will always be the same for you regardless of who you buy it from. That’s because the policy will be priced based on the underwriting table the insurer files with the state insurance regulator.
  • No-risk obligation for you- you, as the policyholder, can cancel your policy at any time if you decide you don’t want it anymore. The insurer, however, cannot cancel your policy as long as you pay the premiums on time.
  • No exclusions- except for suicide during the first two years of the policy (which is standard by law across life insurance policies).
  • Convertible- which means, if you choose to, you can convert the term life policy to a permanent life policy. The conversion will generally cost you more and is subject to certain conditions.

Cost comparison

Quote for: $500,000, 20-year term life insurance policy for healthy, nonsmoking individuals, in California, monthly premiums

COMPANYPLANMALE - AGE 30MALE - AGE 40MALE - AGE 50FEMALE - AGE 30FEMALE - AGE 40FEMALE - AGE 50
AIGSelect-a-Term$21.11$30.62$79.93$18.08$28.46$59.60
AIGROP Select-a-Term$91.21$150.77$281.97$75.80$124.95$261.56
Banner LifeOPTerm$21.44$32.38$94.07$18.19$26.60$58.62
John HancockTerm$26.95$34.65$81.70$24.20$34.00$78.99
Lincoln FinancialLifeElements$28.44$38.94$78.75$23.63$30.63$58.63
Lincoln FinancialTermAccel$21.00$29.75$78.75$17.94$25.81$57.31
Mutual of OmahaTerm Life Answers$21.66$33.47$85.53$23.41$28.66$64.09
Pacific LifePacific PROMISE Term$20.84$29.59$77.09$19.18$26.68$61.67
PrincipalTerm$22.75$31.94$79.63$20.04$27.56$59.24
ProtectiveCustom Choice UL$20.37$28.91$76.82$17.93$25.25$55.75
ProtectiveClassic Choice Term$20.21$28.38$75.68$17.63$25.94$55.47
PrudentialTerm Essential$34.20$43.65$88.65$27.90$38.70$76.95
PrudentialReturn of Premium Term$101.00$143.62$291.99$88.12$130.04$253.37
SBLILevel Premium Term$21.32$40.05$96.06$24.48$34.71$65.87
TransamericaTrendsetter Super$22.36$37.85$79.12$18.06$30.96$62.78
TransamericaTrendsetter LB$24.95$38.27$92.89$20.65$34.84$73.11

Term

Unique Features

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  • Competitive underwriting for higher policy amounts (over $1 million); "sweet spot" is applicants ages 35-55
  • Healthy lifestyle credits program to improve underwriting class for applicants

Details

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  • Annual Payment Discount - 5%
  • Payment methods available - Check; Auto bank draft; No credit cards accepted
  • Is coverage available without a medical exam? - No
  • What is the rule for converting the policy? - The policy is convertible until the earlier of the end of the term or to age 70. Conversion to guaranteed universal life products available only after 2nd anniversary of term policy.
  • Is temporary coverage available? - Yes, up to $1,000,000.

Available Riders

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Riders are additions to your overall life insurance policy that turn a basic life insurance policy into something that covers more circumstances.

  • Child Protection Rider - Provides life insurance coverage for all eligible children at issue with coverage available between $5,000 and $25,000.
  • Disability Income Rider - If you become totally disabled as a result of a qualifying event, premiums are waived (subject to rider limitations).