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Is Farmers Term Life Insurance the Right Choice?

Farmers Insurance has become a household name.  We are constantly bombarded with its funny commercials on television about home and auto insurance.  The fact is that Farmers Insurance is one of the most respected names when it comes to auto, home, business and renters coverage.  But how do they stack up against the competition when it comes to term life insurance? Before you consider buying a term life policy from Farmers, make sure that you consider all of your options.  We are going to take a look at Farmers Value Term Life product an see how it compares to other level premium term products on the market.

Farmers Value Term Life Features

Farmers Value Term is a level premium term life insurance policy that offers coverage options of 10,20 and 30 years.  Coverage starts at $150,000 and is available to applicants ages 18-65.  Value Term is convertible to other permanent coverage options available from Farmers.  Farmers Insurance company is A rated by A.M. Best.  This shows that the company is financially stable and is able to meet its financial obligations.

How does Farmers Term Life Insurance Rates Compare to the Competition?

We decided to compare rates for the Farmers Value Term product to rates for American General’s (AIG) Select-a-Term product.  AIG is just one of the many companies we can access for our clients.  We looked at rates for 35 and 40 year old male and female nonsmoker applicants who would qualify for the best health class ratings with each company. Monthly rates as of 10/13/2015.

Male Applicants Age 35

Coverage DurationCoverage AmountFarmers RateAIG Rate
20 years$500,000$46.43$22.23
20 Years$1,000,000$76.85$38.85
30 Years$500,000$74.76$39.73
30 Years$1,000,000$130.18$71.23

Male Applicants Age 40

Coverage Duration Coverage AmountFarmers RateAIG Rate
20 years$500,000$76.43$30.98
20 Years$1,000,000$144.34$56.35
30 Years$500,000$108.51$55.91
30 Years$1,000,000$197.68$104.48

Female Applicants Age 35

Coverage DurationCoverage AmountFarmers RateAIG Rate
20 Years$500,000$40.18$20.48
20 Years$1,000,000$66.01$35.35
30 Years$500,000$58.93$33.60
30 Years$1,000,000$105.18$60.73

Female Applicants Age 40

Coverage DurationCoverage AmountsFarmers RateAIG Rate
20 Years$500,000$68.10$28.79
20 Years$1,000,000$128.51$51.98
30 Years$500,000$96.01$45.41
30 Years$1,000,000$171.01$84.35

Farmers rates are higher across the board when compared to rates from American General (AIG) as well as many other companies on the market today.  In some cases, rates from Farmers were more than double the rate of its competitors.  The rates we have illustrated show monthly savings.  Think about how that savings would add up over the course of a 20 or 30 year period.  It could mean thousands in savings over the life of your policy.

Drawbacks to Purchasing Life Insurance from Farmers

Farmers Agents are Captive – We’re certain that there are many competent Farmers agents who are knowledgeable and very good at what they do.  But the fact is that Farmers agents are captive.  This means that they only have access to Farmers products.  Independent agencies, like ours, have access to many different companies and product offerings.  Working with a Farmers agent will limit your choices when shopping for the best rate on life insurance. Life insurance rates are affected by so many underwriting variables.  That is why working with an independent agent who can match you with the right company is the best way to find the lowest rate on coverage.  If you’re someone who likes to have all of your insurance coverage such as home, auto and life with one company, Farmers does offer that convenience.  With that said though, Farmers higher prices for life insurance don’t make it worth it in our opinion.

Value Term’s Limited Durations – Value Term offers 3 duration options: 10, 20 or 30 years.  There are companies out there that not only offer 10, 20 and 30 years durations, but also 15 and 25 year durations as well.  American General allows you to customize your term policy by offering an exact period of coverage between 15 and 30 years with its Select-a-Term product.

Conservative Underwriting – Farmers Insurance is very conservative when it comes to underwriting life insurance applicants.  If you have minor to moderate health issues, you could pay a lot more for coverage with Farmers or be declined altogether.  When you work with an independent agent on the other hand, you have options.  There are many life insurance companies out there that serve various niches when it comes to underwriting health or lifestyle issues.  An independent agent can match you with the insurance company that will most favorably underwrite your case.

Is Farmers Term Life Insurance the Right Choice?

Farmers Insurance is a reputable company with a long history of serving its clients.  This post was in no way meant to say anything negative about the company.  We just want consumers to know that there are better options out there for life insurance than Farmers Value Term.  Before you consider working with a captive agency like Farmers Insurance, check out your options and compare.  You will see that you can find much lower rates if you shop around.  Saving a few hundred dollars a year on coverage will mean thousands in savings over the life of your policy.  If you are think about purchasing coverage from Farmers or you have already done so, give us a call at 877-205-4172 or email us at info@termlifeanswers.com and we will be happy to show you your options.

About Us

Term Life Answers was created with the main goal of finding consumers the best rates on life insurance.  If you are looking for the best rates for life insurance, we can help.  We shop the top life insurance carriers in the industry to match you with the company that best fits your situation and offers the best rate.  If you have any questions about your life insurance needs, life insurance products or your existing coverage, feel free to give us a call at (877) 205-4172 or email us at info@termlifeanswers.com .