5Star Life Insurance Review 2020

Founded in 1996, 5Star Life Insurance Company has only existed for roughly 23 years. The company is part of the Armed Forces Benefit Association (AFBA). AFBA provides provides supplemental and voluntary life insurance.

5Star Life focuses on a very small niche in the marketplace. They serve members of the armed forces and have expanded membership eligibility to federal government employees and contractors and first responders such as law enforcement, firefighters, and emergency medical personnel1. They offer term life insurance in the workplace to certain employer groups.

Because 5Star Life Insurance works primarily with employer groups, they really have this market down, and can make life extremely simple for those who want group policies. They do a great job of providing all the resources you will need online, including things like employer agreement forms, claim forms, and group life applications and enrollment forms. They also provide employer groups with necessary marketing collateral.


5Star Life insurance policies

5Star Life Insurance company offers group term life insurance and a variety of riders to employees of specific workplaces that are able to receive their benefits.

Term life insurance

Term life insurance is meant to cover your needs for a specific period of time or term. Term life insurance is the most common type of life insurance that is offered by an employer in the workplace.

Family Protection Plan (FPP) – Term Insurance to 100

5Star offers a term life insurance policy with critical illness coverage to age 100. The policy offers a guaranteed level premium (i.e. fixed) to age 100.

The critical illness benefit will pay 30% lump sum if the insured suffers a heart attack, terminal cancer, stroke, heart transplant or cardiac bypass, or terminal illness.

Although the premium is fixed, the death benefit is structured to remain level for the first 10 years of the policy after which time the group death benefit may decrease. However, the coverage amount cannot be decreased on an individual basis.

Life insurance rider options

Quality of life rider

This rider if a part of the Family Protection Plan (FPP) offered by 5 Star Life Insurance. This policy has the quality of life rider built in which accelerates a portion of the death benefit on a monthly basis as scheduled by your employer. You are able to receive up to 75% of the current face amount of the death benefit following a diagnosis of either a chronic illness or congnitive repairment that requires substantial assistance.2

Waiver of premium rider

The waiver of premium rider is part of the FPP plan and is meant to ensure your coverage continues in the event you have a disability. This is part of the term life insurance that offers coverage up to age 121.

If you are completely disabled due to sickness or an accidental bodily injury then after a consecutive 6 month waiting period, your premium payments are waived for as long as you are disabled.3 To learn more about the specifics of qualifying for these benefits speak with your company’s benefits representative.

Automatic increase rider

The waiver of premium rider is part of the FPP plan and is meant to have your coverage be more responsive as your needs change. This is part of the term life insurance that offers coverage up to age 121. Adding this rider allows you to purchase additional coverage as a lower rate.4

Other insurance offered in the workplace

Group Critical Illness insurance

This type of insurance is meant to provide you with financial protection should you be first diagnosed with the 3 covered conditions – cardiovascular, cancer, or other covered conditions.5 The company doesn’t list their other covered conditions, so check with your benefits advisor to learn more about your options.

Group Accidental Death and Dismemberment (AD&D)

This type of insurance provides protection for you in the event that you are involved in an accident. Your beneficiary would receive an additional death benefit payout if you were in an unintentional accident where you passed away. For dismemberment you are also able to receive a payout if you suffer the loss of a major part of your body such as a limb.


Is 5Star Life Insurance Company financial stable? 

A.M. Best Company is one of the most renowned life insurance rating agencies. A.M. Best gave 5Star Life with an A- (excellent). This rating is exceptionally high, particularly in comparison to other life insurance companies of comparable size and scope.

Why should I care about life insurance companies ratings?

The ratings help you to know which companies have the ability to meet financial obligations. Since you are buying life insurance that may one day pay out a death benefit to your beneficiary it is important to choose a company with a strong rating. Based on the A.M. Best Company rating given to 5Star Life, you can know that the company currently has the ability to meet its present obligations and the strength to meet its long term financial obligations as well.


Bottomline: 5Star can be a good choice if you can get it

5Star specializes in group life insurance for specific employers. If you don’t work at a company that already offers their policies you may want to look elsewhere.

When it comes time to choosing from among the different types of life insurance policies, there are a lot of things to consider. You need to spend time thinking about how much life insurance coverage you can afford, and how much life insurance coverage you need.

Learn more about your next steps:


Sources

1. 5 Star Life Insurance Company, “About
2. 5 Star Life Insurance Company, “Quality of Life Rider PDF
3. 5 Star Life Insurance Company, “Waiver of Premium Rider PDF
4. 5 Star Life Insurance Company, “Automatic Increase Rider PDF
5. 5 Star Life Insurance Company, “Critical Illness Rider PDF

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