Prudential Life Insurance, one of the biggest life insurance providers in America , has certainly made an impact on the industry.
I mean, with over 100 years of practice it’s no wonder why, but, have they stretched themselves too thin? How do they fare in 2023? Here is our analysis.
Starting from the beginning, Prudential Life Insurance began in Newark, New Jersey in the year 1875 by John F. Dryden, who would later become a US Senator. Prudential Life Insurance’s original name was The Widows and Orphans Friendly Society, where it would quickly become Prudential Friendly Society, into the insurance giant we’re familiar with today.
Prudential Life Insurance began before the widespread government mandate of insurance rates and who may sell them. Throughout the 20th century, Prudential Life Insurance would continue to acquire various subsidies and other joint ownership ventures until it went public in 2001 after almost 100 years of being solely and only owned by shareholders.
This isn’t without their fair share of lawsuits, though, with the most notable one occurring in 1981 when Prudential Life Insurance was court-ordered to refund over $2 billion to customers complaining of fraud. Fast Forward to now, Prudential Life Insurance was the largest insurance provider in America for the year of 2019, and had over $815 billion in total assets that year alone. But does this necessarily correlate to safety? Can you grow too large and spread yourself too thin? Read on for our analysis.
1875: Founded in Newark, New Jersey by John F. Dryden
1912: John’s son Forrest took over as president of the company.
1981: Prudential Life Insurance acquired Bache & Co.
1997: Class Action lawsuit is settled in court, where Prudential Life Insurance was ordered to pay $2 billion in refunds.
1999: Prudential Life Insurance sold their healthcare division to Aetna for $1 billion.
2001: Company goes public and is now traded on the stock exchange.
2004: Terrorist threats received against the Prudential Life Insurance headquarters in Newark, prompting large reform and an overall tighter approach to security.
2018: Charles F. Lowrey, the current CEO of Prudential Life Insurance, is elected as current CEO.
Standard Coverage, or “pure” life insurance. Generally, you’re provided with a term, such as 20 years for example, wherein you’re guaranteed payment as stated by the death benefit if the policyholder dies within the stated term. If alive at the end of term, one may renew for an additional term, or convert the existing coverage to permanent coverage.
The perks of this coverage involve the introductory price point, which is generally the most budget-friendly option for the relative amount of coverage received. Depending on if it’s simplified or guaranteed, this form of insurance usually requires a medical examination.
Prudential Life Insurance offers 3 term policies titled, SimplyTerm, Term Essential, and PruTerm One. The difference between these policies includes their relative coverage amount, as well as the monthly premium. All 3 may be converted to permanent plans after approval is received.
Similar to a whole life insurance policy, a Universal Life Insurance Policy offers long-term protection and coverage, although without the luxury of fixed premiums. As a result, your premium can change depending on current economic conditions. With this in mind, your policy could potentially substantially increase as you get older. The upside to this policy type, though, is the fact that the payment schedule associated with such a policy is very flexible and allows for payments to be made at the discretion of policyholders.
Prudential Life Insurance contains 2 universal life insurance policies titled, PruLife Essential UL, and PruLife SUL protector. It’s important to note that the PruLife Essential UL has a maximum coverage amount of $65 million. PruLife SUL Protector covers two people at a lower cost then if each individual was insured by themselves.
Survivorship Universal Life Insurance is usually referred to as Second-to-die insurance, as it covers two people and payout only occurs after these two individuals pass away, vs the usual one.
The benefits of this policy involve the financial difference between a survivorship universal life insurance policy and two regular Prudential whole life insurance policies. It’s more expensive to insure two individuals individually with Prudential whole life insurance policies vs insuring them together with a survivorship universal life insurance policy.
Although not marketed as “Final Expense Insurance” or via other phrases you might expect to see when it comes to final expenses, Prudential Life Insurance does have a Universal Life Insurance policy that essentially performs the same function.
The benefits of this policy include the guaranteed acceptance offered to those between the ages of 18 to 75, as well as the lack of a medical exam or questionnaire. Your coverage caps out at $100,000 under this Universal Life Insurance policy.
This policy also builds cash value, which is somewhat different from most Final Expense policies. Your monthly premium will also never increase so long as you continue to pay your premiums and don’t request more coverage.
Incredibly high coverage amounts. Offering up to $65 million in coverage, this is the most coverage we’ve seen offered out of all of our guides.
Gladly Accepts HIV patients. Some of the most lenient HIV underwriting in our experience insuring individuals.
Easy to use online functionality. The Prudential Life Insurance website offers online rates, a calculator, as well as a plethora of informational articles on the topic.
Term coverage is expensive. As a result of such high coverage maximums, the monthly premium skyrockets.
Incredibly high number of customer complaints. 8.65 is the highest NAIC rating we’ve seen so far out of all of our guides, and the higher this number is the higher number of recorded complaints compared to the industry average.
No Prudential Whole Life Insurance Options. They may offer a lot of different policy types, but where they lack revolves around the lack of whole life insurance options.
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.
Prudential Life Insurance most recent rating is that of an A+, indicating exceptional financial strength.
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.
Regarding Prudential’s NAIC rating, they received a rating of 8.65 in 2021, implying a ridiculously high amount of complaints being generated by prudential life insurance.
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.
The most recent rating administered by the J.D. Power rankings was that of 15th out of the 21 life insurance companies assessed, implying performance towards the bottom of its competitors.
Without a doubt, the answer is yes. The financial rating given to Prudential indicates exceptional financial stability as well as their sheer amount of payouts administered yearly, you can place your trust in the financial ability of Prudential Life Insurance to cover you.
Now, the issues stem from the difficulty in dealing with Prudential Life Insurance. As you read earlier, the reviews we found online were overall not very good, on top of the fact that the rating given by the NAIC indicates almost 9x the average customer complaints. In the end, is this worth the trouble? There are plenty of other insurance providers with this level of financial stability with much fewer customer complaints.
Insurance policies generally contain a 30-day refund introductory period, where you are able to receive a complete refund if canceled before the 31st day if dissatisfied. This is a two-way policy, allowing for insurers to cancel your policy for the same reasons. This may also be overridden by state law, if applicable. An example includes Florida, which bars insurers from cancellation up to 90 days after the policy start date. Exceptions include, if premiums are not paid, substantial change in risk to insure, etc.
Overall, unless you are HIV positive, we cannot recommend this insurer to any of you reading this.
The ratings are just too concerning, as well as the price point not being very competitive compared to other similar policies in the market. It’s actually surprising to think about how many better options there are for life insurance.
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Being some of the ones that stand out among the crowd. Reduce the stress involved with life insurance for seniors and let us do all of the heavy lifting for you.
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This depends on the policy type, but most of the time the answer is no. The only policy requiring a medical exam would be a term policy with a really high maximum, like $50,000 plus.
Overall, not very good. The financial stability as rated by the A.M.’s best is great though.
They unfortunately do not.
This is one of the biggest life insurance companies in India.