Please ensure Javascript is enabled for purposes of website accessibility

This device is too small

If you're on a Galaxy Fold, consider unfolding your phone or viewing it in full screen to best optimize your experience.

Skip to main content
Advertiser Disclosure Many of the offers that appear on this site are from companies from which The Motley Fool receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear) and may influence which products we write about, but our product ratings are not influenced by compensation. We do not include all companies or offers available in the marketplace.
    |    Accessibility Options

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

Published April 19, 2023
Dana George
Author: Dana George
Dana George
Dana George
Writer

Dana George has a BA in Management and Organization Development from Spring Arbor University. For more than 25 years, she has written and reported on business and finance, and she's still passionate about her work. Dana and her husband recently moved to Champaign, Illinois, home of the Fighting Illini. And though she finds the color orange unflattering on most people, she thinks they'll enjoy Champaign tremendously.

See Full Bio

Many or all of the products here are from our partners that compensate us. It’s how we make money. But our editorial integrity ensures that our product ratings are not influenced by compensation. Terms may apply to offers listed on this page.

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.

Logo for American Family Life Insurance
Best for final expensesAmerican Family Life Insurance
Rating image, 4.00 out of 5 stars.
4.00/5 Circle with letter I in it. Our ratings are based on a 5 star scale. 5 stars equals Best. 4 stars equals Excellent. 3 stars equals Good. 2 stars equals Fair. 1 star equals Poor. We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
 = Best
= Excellent
= Good
= Fair
= Poor

Full American Family life insurance review

Pros

  • Offers no-medical-exam option
  • Simplified policies available
  • Some term life policies are convertible to whole life
  • AM Best rating of A (Excellent) for financial strength

Cons

  • More expensive than many competitors
  • Low coverage limits for specialized policies
  • No variable or indexed universal policies
  • Limited number of riders

American Family life insurance at a glance

  • 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.

Pricing

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.

Term Coverage Annual Premium
35-year-old male, non-smoker, $500,000 coverage for 20 years. $518
35-year-old male, non-smoker, $1 million coverage for 20 years. $924
35-year-old female, non-smoker, $500,000 coverage for 20 years. $417
35-year-old female, non-smoker, $1 million coverage for 20 years. $742
Data source: American Family.

Alternatives to consider

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.

Policy options

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.

Riders/add-ons

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.

Application process

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.

Who is eligible for American Family insurance?

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

Customer service and ratings

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

This life insurer is a good choice for:

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.