AARP Insurance | Secrets They Don't Want You To Know
Easy Navigation
AARP is a well-known name in the insurance world, supporting nearly 38 million members across the United States and US territories. They’ve remained in the business since 1958 with their official conception, but how do they hold up in 2022? Our goal with this article is to allow you to make your own informed decisions based on the information below.
Origin Of AARP
Dr. Ethel Percy Andrus, the founder of AARP, created the National Retired Teachers Association (NRTA) in 1947, which was founded in response to her philosophy regarding productive aging, as well as the current state of teachers and their lack of health benefits. AARP was then the next step in this foundation’s evolution, and in 1958 would become the AARP we’re all familiar with. It’s important to note that the first established instance of free, nationwide health benefits, came in 1965 when congress enacted Medicare for all, therefore at the time, Dr. Andrus’ ideals were radical. As a result, she needed to contact dozens of insurance broker’s in hopes that one would be willing to work with those over age 65.
As you probably can guess, she was inevitably successful and went on to procreate one of the most prolific names in the insurance/medicare industry.
It’s important to note that Life Insurance with AARP is currently underwritten by New York Life, whom AARP partners with to supply its members with your normal term and whole life benefit programs. AARP also utilizes UnitedHealthCare for its Medicare Supplement plans and Hartford for any auto-related insurance policies.
Your Coverage Options with AARP
Life Insurance
Guaranteed Acceptance
Guaranteed acceptance policies are those that accept all applicants regardless of status, although at an adjusted rate based upon your qualifications. These policies do not have a medical exam, but rather a questionnaire meant to assess your current health status. Guaranteed Insurance with AARP will last your entire lifetime, does not expire, and remain at the adjusted rate given to you at policy signup (ideally).
Term Life Insurance
Term Policies are those that are confined to a term, usually existing in 5 years increments up to 20. These policies can be renewed at any time, and usually do require a medical exam as the associated rate is low.
Burial Insurance
AARP Burial Insurance for seniors, or AARP Final Expense Insurance, involves final expenses such as a funeral, ceremony, cremation, burial, what have you. These policies are similar to a guaranteed whole life policy, although at a lower premium for a lower overall payout value. Although marketed for final expenses, the payout does not actually withhold any restrictions, meaning the beneficiary may use the funds for whatever they wish.
Medicare Advantage
To clarify, Medicare is a nationwide plan enacted to provide seniors with health benefits if they meet minimum requirements. Plans in Part C of the Medicare Advantage program are offered as an alternative to Original Medicare and are run by private organizations, which is the case with AARP partnered with UnitedHealthcare Insurance Company.
Other Forms of Insurance
Homeowner’s Insurance
Auto Insurance with AARP, in which AARP is partnered with The Hartford, offers comprehensive coverage regarding your motor vehicles.
Standard homeowner’s insurance, wherein recipients cover any potential liabilities with coverage. Insurance with AARP may also involve renter’s insurance, umbrella insurance, condo, and flood insurance.
Dental Insurance
Standard Dental Coverage, allowing users to participate in routine dentist cleanups as well as any applicable dental work that may be required at a reduced rate.
Overall, very broad coverage options, some of the broadest in the industry, with a few additional policies not named here. This is AARP’s greatest strength, more than likely being able to provide an option to any potential policy owners, but at what cost? Most programs contain a drawback, such as high rates relative to the market, group policies, etc.
AARP Burial Insurance for Seniors:
Here at Final Expense Benefits, we’d like to pay particular attention to Burial Insurance offered by those we review, as that’s our most common affiliation. Regarding AARP Burial Insurance for seniors, we weren’t particularly impressed. Overall, rates offered by AARP’s Burial Insurance were higher than the overall average, as well as the average price among our main insurers.
Also, from what we saw online, they offer a medical questionnaire with their burial insurance that may actually deny you coverage – an inherently negative development because these policies are meant to be guaranteed issue, although at different rates depending on certain factors. Although not as significant, AARP Burial Insurance is a comprehensive group policy, meaning any changes indicted by AARP will reflect on all users associated with AARP Final Expense Insurance.
AARP Pros and Cons
Pros
- Very highly rated financial stability. You know you’re going to get paid when the time comes.
- Easy and intuitive online process. Overall easy to understand online process, with a minimalist style.
- AARP members receive a very wide range of benefits. Such as discounts with AARP on your everyday costs like amazon membership as well as many other benefits.
Cons
- Lackluster customer service. Nothing too bad, but rather aggressively average as indicated by the various third-party ratings.
- Relatively high prices. Compared to other competitors in the industry.
- Need an AARP membership to receive maximum discounts. With AARP, specifically to reach the full potential of savings with a policy.
Third-Party Rankings
NAIC
The NAIC, or The National Association of Insurance Commissioners, is a regulation standard support organization based in America meant to add credibility to insurance companies. Essentially, the goal of this organization is to protect consumers and to mandate that insurers deliver on their promises made. The rating used within the NAIC involves a numerical value usually ranging from 1 – 10. One implies average customer complaints, where anything above this is above average, and so on. AARP’s rating as of March 2022, was 1.93, which is almost double the national average regarding customer complaints.
JD Power Rating
JD Power ratings are essentially nationwide surveys that allow consumers an unbiased opinion regarding what other consumers say about said company. This is done either through focus groups, paid calls, or what have you. JD Power spends large sums of money annually simply on data specifically for this reason. As of 2021, AARP was ranked 8 in an 11 list survey, indicating 3rd from the bottom.
AM Best Rating
They utilize a rating, similar to the letter ratings placed on restaurants, meant to help you discern their overall quality. This letter ranking varies from A+ to F, similar to a scholastic grading system, and this organization is overseen by the chief insurance regulators regarding any US-affiliated territory. The rating itself is determined by a variety of different factors, such as performance, management, financial flexibility, shareholder safety, etc. AARP is not rated by third-party organizations, but their underwriter, New York Life is. They hold an A++ in financial strength, which demonstrates almost perfect reliability.
Cancellation Policy
Customer Reviews
Our Review and Final Thoughts
Overall, Insurance with AARP serves as a very average option for most individuals, excluding teachers and specific members with a large number of benefits. We say average because you may not receive secured coverage, at the cost of an increased monthly premium. Definitely, a give-and-take kind of situation. We recommend doing your research and comparing your rates accordingly, and to stay away from their Final Expense Insurance if you can. We also feel as though without a membership/discounts with AARP, you’re not getting the best rate available to you.
AARP membership significantly reduces overall costs, as well as incentivizes a lot of benefits. However, the rates provided to non-members, as well as the overall treatment of non-members, really doesn’t entice us personally. We at Final Expense Benefits partner with over 20 carriers, with:
Being some of the ones that stand out among the crowd.
Feel Free to call us M-F, 9-5, for a free consultation. Our number is (866) 311-4338
Frequently Asked Questions
What Does AARP Stand For?
The American Association of Retired Persons.
Is Insurance with AARP worth it?
If you have a membership, then the answer may be yes as your discounts with AARP will be notable. If not, then the answer is more than likely no.
How Do I Qualify for AARP?
You simply must be over age 50.
Do I Need AARP Membership to Qualify For a Policy?
You do not, although having this membership does offer a plethora of benefits.