American Family Life Insurance Review: May Not Be Exciting, but Firmly Planted on Solid Financial Ground

This life insurer is a good fit for: A consumer seeking an insurance company on solid financial ground and a fair number of policy options.

• Average costs ($500,000, 20-year policy): 35-year-old non-smoking male: $518.04. 35-year-old non-smoking female: $416.64
• Riders/Add-ons: Children's Insurance Rider, Guaranteed Purchase Option, Waiver of Monthly Deductions for Disability.
• Eligibility: Term: 18 to 70 years old. Simplified Term Life and DreamSecure EasyProtect Term: 18 to 60 years old. Whole life: Birth to 80 years old. Children's Whole Life: Birth to 17 years old. Senior Whole Life: 50 to 80 years old.
• Simplified policy availability: Yes
• Discounts available: N/A
• Other insurances offered: Simplified Term, DreamSecure EasyProtect Term, Whole Life, Children's Whole Life, Senior Whole Life.

Top perks

No-medical-exam policies available

Not every applicant or every policy will qualify for a no-medical-exam policy. However, if you're in relatively good health and want to skip the exam, American Family offers policy options.

Simplified policies

A simplified term life policy requires no medical exam and approval, subject to your health history. For the consumer looking for a no-fuss way to secure life insurance, simplified may be the closest thing to ideal. The policy is based on health and age, meaning the earlier in life you apply, the lower your rate is likely to be.

The only fly in the ointment is that American Family's simplified term life only provides coverage from $50,000 to $150,000. However, since a simplified policy can be converted to a whole life insurance policy, it's still a good deal for those with a long-term plan.

Convertible policies

A convertible policy allows a consumer to have the less-expensive term life coverage they need today and to convert their term life into a permanent policy when they're financially ready.

Excellent financial strength

With an AM Best rating of A for financial strength, consumers can be confident that American Family will be there when they need them.

What could be improved

More expensive than many competitors

Simply put, there are other insurers offering more competitively priced term life policies.

Low coverage limits

While the lack of a medical exam makes a simplified term life policy convenient, the coverage limit of $150,000 is quite low.

No variable or indexed universal policies

Not everyone will be interested in a variable or indexed universal life policy, but for those who are, American Family is not the right fit.

Based on our research, term life policy premiums through American Family life insurance are mid-range. Some insurers offer considerably lower prices, and some are higher. To compare rates, our scenarios look at how much coverage would cost for a 35-year-old male and female, both non-smokers, and both looking for a 20-year term policy.

If you're looking for term life insurance at a lower cost: Banner Life shines where American Family does not. However, American Family offers more policy options than Banner Life. If customer service tops your list of "must-haves," State Farm cannot be beat. That said, Banner Life rates are more competitive.

Term Life

As the name implies, term life is active for a specific term, normally 10, 15, 20, or 30 years. If the policyholder dies while the policy is in effect, a death benefit is paid to named beneficiaries. There is no cash value when the policy expires.

Simplified Term Life

Simplified term life allows an applicant to take out a life insurance policy with no medical exam. The premium is guaranteed to remain the same over the life of the policy, and the policy can be converted to a permanent life policy.

Whole Life

As long as the policyholder continues to make their premium payments, a whole life policy lasts their entire life. In addition, a whole life policy accumulates cash value that can be borrowed. Whole life insurance is far more expensive than term life, and opinions vary as to whether it makes financial sense.

Child Whole Life

Parents or grandparents can purchase additional coverage for their children at specific milestones set forth by the insurer. There are three coverage options -- $25,000, $50,000, and $75,000. Both 10-year and 20-year plans are available.

Senior Whole Life

Senior whole life insurance is designed for adults between 50 and 80. No medical exam is required but approval is based on answers to a health-related questionnaire. Policies are only available for $10,000 or $50,000. Frequently, a policy like this is purchased to cover final medical and funeral expenses.

Flexible Life

With a flexible life policy, premiums and coverage can be adjusted to meet the changing needs of the policyholder. Unlike a traditional term policy, flexible life insurance allows the policyholder to pull money out to pay emergency expenses, like medical bills.

Children's Insurance Rider

A children's insurance rider allows a policyholder to add $15,000 worth of coverage for children, whether they are biological, adopted, or stepchildren. No matter how many children are added, the premium is the same.

Guaranteed Purchase Option

The guaranteed purchase option rider allows a policyholder to purchase additional life insurance without a medical exam or medically-related questions.

Waiver of Monthly Deductions for Disability

Every American Family life insurance policy automatically comes with an Accelerated Death Benefit option that can be added if the need arises. This benefit allows a policyholder who has been diagnosed with an eligible terminal illness to collect a portion of their death benefit prior to death.

You begin the application process by requesting a quote, either online or with an American Family agent. After making contact, you'll choose the type of policy you want and the amount of coverage. You'll either fill out an application or an agent will do it for you. The application requires you to provide basic information about your health and chosen beneficiaries.

You may have a telephone interview or be asked to complete an in-person medical exam. American Family will make sure the exam is set up in a place that is convenient for you. For example, if you would like the exam to be conducted in your home, that is possible.

Once the exam is complete, American Family will get back to you, let you know the results, and give you a final quote. If you opt for a no-exam policy, you will naturally get to skip the medical examination.

Age eligibility for American Family life insurance depends upon the type of policy you're interested in buying. For example:

• Term Life: 18 to 70 years old
• Simplified Term Life and DreamSecure EasyProtect Term: 18 to 60 years old
• Whole Life: Birth to 80 years old
• Children's Whole Life: Birth to 17 years old
• Senior Whole Life: 50 to 80 years old

American Family life insurance has a ConsumerAffairs rating of 3.8 out of 5 stars. Complaints tend to focus on premium costs.

Customers looking for life insurance with a well-respected insurance company.

American Family life insurance is best suited for people who:

• Don't mind paying more to work with a financially solid insurer.
• Want a simplified policy.
• Don't want or need a full menu of rider options.
• Want to convert term life to whole life at some point.

But you may want to consider Banner Life if you're looking for more competitive term life premiums or State Farm if customer service is of utmost importance to you.