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TIAA Life Insurance Company Review

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Don’t you wish that buying life insurance were like ordering an iPhone case from Amazon? You read a few customer reviews, click the checkout button, and it magically shows up at your door two days later.

Unfortunately, buying life insurance is a serious business, and since your family’s future will depend on it should you die prematurely, you may want to do your research before the purchase.

We believe that writing life insurance reviews can help our clients in reaching better decisions when applying for coverage. Today, I review TIAA Life Insurance Company and attempt to answer the question: Should I get life insurance from TIAA?

TIAA Life Insurance History

TIAA was established in 1918 by Andrew Carnegie and his Foundation for the Advancement of Teaching. They created a funded pension for professors called the Teachers Insurance and Annuity Association of America (TIAA) which produced a sustainable, guaranteed income for individuals in the academic, government, and non-profit fields.

Funding was granted by the Carnegie Corporation, participating organizations, and contributors. In 1921, the policyholders chose Professor Samuel M. Lindsay of Columbia University to serve them on the TIAA board of trustees which inherited the Carnegie Foundation’s values and teachings in running a business. In 1933, Albert Einstein became a member, something TIAA used in advertising campaigns.

TIAA Life Insurance Financial Ratings

Products Offered by TIAA Life Insurance

TIAA offers an array of financial services from retirement plans, annuities, IRA, banking and investment. This TIAA review will mainly focus on its life insurance products and services. TIAA offers temporary and permanent coverages. Let’s take a look at each one.

Level Term Life Insurance

Level term life insurance is temporary protection which provides a level death benefit and fixed premiums for the chosen contract. Term life is a favored solution by young families and individuals on a budget because they can get the most coverage at the lowest possible price whereas whole life or other permanent coverage can cost twenty times as much for the same coverage.

Anything from mortgage protection or income replacement to college tuitions are some of the reasons people choose term life over another type of protection. TIAA offers 10-, 15-, 20-, or 30-year terms from which to choose with a minimum death benefit starting at $100,000.

At the end of the term period, if you still need the coverage, TIAA allows you to convert the policy to lifetime protection (any permanent coverage TIAA offers at the time of conversion) without a medical exam or health questions before you turn 80 (age 65 in NY). You can also elect to renew your policy annually (ART) at the end of your term until you reach age 95 (age 80 in NY).

Annual Renewable Term Insurance

TIAA offers another type of temporary protection called Annual Renewable Term Life which guarantees fixed premiums for one year at the time. Each year, you can renew the coverage without taking an exam or going through underwriting. However, you will pay more each year as you get older. The pay-as-you-go gimmick is a bad idea, and you should consider a 10- or 20-year term where your premium remains level for that period without price fluctuations each year.

Intelligent Life—Universal Life Insurance

For those who seek permanent protection, universal life insurance is an exceptional opportunity you should consider. Universal life (UL) keeps your coverage flexible by giving you complete control over the customization of the policy.

For instance, you can increase or decrease the amount of your death benefit or premium while ensuring a guaranteed payment to your heirs when you pass away, whenever that time is. UL also provides cash growth potential by having a savings account attached to your policy, which grows on a tax-deferred basis.

The policy owner can tap into these savings by taking a loan, withdrawal, or surrendering the policy. TIAA Life offers a minimum of 3% annually on their fixed account choice.

Let’s review TIAA’s universal life options:

  1. Survivorship Universal Life: Is a policy that covers two individuals and pays a death benefit upon the death of the second person. It’s geared towards individuals who seek estate planning to help their heirs when they inherit a business or a large estate.
  2. Variable Universal Life: Offers a greater cash value accumulation option when compared to traditional UL because the cash portion is invested directly in the stock market. This is favored by high net worth individuals who can hedge their investment portfolio. It isn’t recommended if you don’t have the stomach for market movements because your cash value may decrease.
  3. Survivorship Variable Universal Life: A policy for two individuals with cash growth accumulation.

Available Riders

Life insurance riders are provisions to further customize your coverage to meet your needs. Note that riders are not available on all plans or all states.

  1. Living choices benefit: Is also known as the accelerated death benefit option, allows the insured to receive a portion or all the death benefit amount if he is diagnosed with a terminal illness. This rider is included free of charge on all TIAA’s life products.
  2. Charitable giving benefit: This is a special rider which will pay up to1% of your policy’s death benefit, up to $100,000, to a charity of your choice. This rider will not cost you anything, but you must select it when applying for coverage.
  3. Over-loan protection endorsement: Automatically included in your UL coverage. It ensures that your coverage will not lapse due to insufficient funds in the savings portion of your account.
  4. Level cost of insurance endorsement: Allows the insured to lock in the rates for a 10- or 20-year period as opposed to the rates increasing each year based on your age. This is only available with the variable universal life plans.
  5. Waiver of monthly charges: Is also called disability rider which waives the policy’s premiums and keeps it in force if the insured is totally disabled. This rider is offered at an extra charge.
  6. Last survivor policy split option: Offered on the survivorship policies, is a provision that allows splitting the coverage into two separate life policies in the event of divorce or dissolution of a partnership. It’s worth mentioning that no evidence of insurability is required, and this rider comes at no additional cost.
  7. Estate transfer protection: It offers additional funds to relieve the tax burden on a survivorship policy if the second insured dies shortly after the first one (at which case, the estate may be transferred to the first insured’s estate and that may create a tax issue). This rider is available at extra cost.

TIAA Life vs. Other Carriers’ Sample Monthly Rates

Male 20-year Term $250,000

 CompanyAge 30Age 40Age 50Age 60
 Banner $13.05 $19.01 $40.44 $110.28
 Protective $13.05 $17.80 $41.26 $110.61
 AIG $13.17 $19.37 $42.24 $118.76
 Pacific Life $13.18 $18.79 $41.44 $110.29
 Lincoln$13.28 $18.16 $41.15 $109.77
 Mutual of Omaha $13.55 $20.64 $45.80 $134.59
 Principal $14.00 $18.55 $41.19 $109.81
 North American $14.30 $20.02 $43.56 $115.06
 TIAA Life $14.98 $20.02 $48.58 $130.27
 Prudential $20.35 $24.50 $45.50 $128.85

Female 20-year Term $250,000

 CompanyAge 30Age 40Age 50Age 60
 Banner $11.61 $15.39 $32.21 $78.83
 Protective $11.76 $15.44 $31.65 $77.17
 AIG $11.67 $16.59 $33.90 $87.98
 Pacific Life $11.71 $16.00 $31.83 $77.91
 Lincoln$11.82 $15.67 $31.57 $82.47
 Mutual of Omaha $12.26 $17.63 $35.69 $101.91
 Principal $12.54 $16.19 $32.07 $77.18
 North American $12.76 $16.94 $34.10 $81.84
 TIAA Life $13.34 $17.94 $35.90 $91.11
 Prudential $17.28 $22.53 $40.03 $89.25

Male 20-year Term $500,000

 CompanyAge 30Age 40Age 50Age 60
 Banner $20.00 $32.68 $73.52 $204.89
 Protective $20.01 $28.75 $75.24 $207.86
 AIG $20.01 $30.27 $76.86 $218.79
 Pacific Life $20.19 $30.26 $75.22 $207.36
 Lincoln$20.39 $30.50 $74.99 $213.02
 Mutual of Omaha $21.29 $32.90 $82.78 $249.19
 SBLI $21.32 $34.97 $87.00 $286.85
 Principal $21.43 $30.54 $75.82 $213.06
 TIAA Life $22.31 $33.56 $83.56 $240.14
 Prudential $33.25 $41.57 $83.57 $250.25

Female 20-year Term $500,000

 CompanyAge 30Age 40Age 50Age 60
 Banner $17.37 $25.20 $58.35 $150.93
 AIG $17.44 $26.85 $58.05 $161.51
 Pacific Life $17.51 $25.69 $56.10 $144.97
 Protective $17.53 $25.11 $54.88 $138.51
 Lincoln$17.68 $25.64 $55.31 $144.95
 SBLI $18.18 $27.33 $63.08 $173.03
 Mutual of Omaha $18.28 $28.17 $61.71 $172.65
 Principal $18.52 $25.81 $57.58 $147.79
 TIAA Life $19.29 $28.44 $83.56 $160.83
 North American $19.36 $28.16 $61.60 $154.88

Male 20-year Term $1,000,000

 CompanyAge 30Age 40Age 50Age 60
 AIG $32.83 $53.35 $141.42 $415.02
 Lincoln$32.91 $53.12 $142.11 $409.07
 Protective $33.78 $51.67 $141.51 $393.73
 SBLI $34.34 $55.91 $147.73 $457.62
 Pacific Life $34.72 $54.10 $141.44 $406.55
 Principal $36.21 $54.51 $145.08 $418.34
 Banner $36.33 $54.74 $141.41 $411.08
 Mutual of Omaha $36.34 $59.56 $157.60 $470.64
 TIAA Life $39.29 $60.46 $158.29 $465.24
 Prudential $48.57 $70.44 $157.94 $467.69

Female 20-year Term $1,000,000

 CompanyAge 30Age 40Age 50Age 60
 Banner $25.98 $46.96 $110.42 $294.55
 Protective $28.50 $43.52 $101.32 $265.48
 AIG $25.99 $44.80 $109.78 $311.56
 Pacific Life $28.73 $44.50 $103.19 $274.04
 Lincoln$27.48 $43.41 $102.73 $282.01
 Mutual of Omaha $30.32 $48.38 $112.88 $327.88
 Principal $30.35 $44.89 $105.26 $283.06
 North American $32.12 $48.84 $113.08 $283.80
 TIAA Life $32.73 $50.84 $114.71 $305.20
 Prudential $37.19 $59.94 $124.69 $319.82
*All rates quoted on this page are for a super-preferred healthy individual who does not use tobacco. Monthly rates are updated as of Jan 2019 and are subject to underwriting approval.*

**Rates Source: Compulife software**

Bottom Line

Is merely the fact that Albert Einstein was a TIAA member enough reason to buy insurance from TIAA? Well, when it comes to their term life insurance pricing, they are in the middle of the road—not the most expensive, but not the lowest ones either.

Of course, the lowest price isn’t an optimal measure in choosing which company to apply to because only about 5% to 10% can qualify for the lowest costs due to underwriting risks. If you are looking for universal life coverage, you should give TIAA a call and get a quote. The product is solid and comes with extra riders at no additional costs.

If you are looking for term life insurance, I would encourage you to compare the rates you can qualify for based on your health risk before committing to TIAA. Use the form on the right-hand side of the screen to see life insurance quotes instantly.

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