AIG American General Life Insurance Review

This solidly rated behemoth offers you a well-stocked buffet of life insurance options, but its low customer ratings leave something to be desired.


+   Wide range of life insurance products
 Flexible plans with plenty of rider options
   Poor customer ratings
   Shaky history

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AIG is one of the oldest and largest insurance companies in the world, but age doesn’t always bring wisdom. After a few notable stumbles in the past, AIG is back on solid financial footing. Its size allows it to offer a wide range of insurance options, with everything from simple term life insurance to more complex products, like variable universal life insurance.  In many ways, AIG has set out to offer all products to all people.

AIG life insurance products

AIG offers the most popular forms of life insurance, including term life, guaranteed whole life, universal life, and variable universal life. Its quality of life insurance product is an interesting option that includes potential payouts during the life of the policyholder.

Though these insurance products may sound relatively standard on the surface, dig a little deeper, and you’ll discover that AIG offers multiple products within each category. More choices mean you can find a life insurance product better suited to your specific needs and budget.

AIG life insurance offerings

Type of policy Coverage range Age range Exam required? Riders available?
Term life $50,000–$10,000,000 20–80 Yes Yes
Guaranteed issue whole life $5,000–$25,000 50–85 No Yes
Quality of life insurance $50,000–$10M+ 0–85 Depends Yes
Universal life Min. $50,000 18–80 Depends Yes
Variable universal life Min. $100,000 0-80 Depends Yes

*Table created using information available at https://www.aig.com/individual/insurance and Ty Steward, SimpleLifeInsure.com as of 12/20/18.

Things to consider about AIG

American General celebrates its 100th birthday in 2019, but its century of life hasn’t exactly been smooth sailing. In the past twenty years, AIG weathered a major accounting scandal and accepted a government bailout in 2008 to keep from defaulting during the Great Recession.

Yet, AIG has managed to drag itself up and over that precipe and find solid footing. It’s also paid back its massive federal loan with interest.

AIG pros

  • Term life insurance death benefit payouts up to $10 million
  • Flexible term life policy duration
  • Return of premium option on term policies
  • Guaranteed issue whole life and universal life options with no medical exam

AIG cons

  • Past mistakes that almost led to default
  • Overwhelming quantity of options

Today, AIG is once again a trusted brand with worldwide reach. Life insurance customers, in particular, will appreciate the company’s many different insurance options. Its term life insurance offers high payouts and flexible term lengths, while its universal insurance products allow policyholders to build a handy cash value.

Older individuals—especially those with pre-existing conditions—will want to learn more about its guaranteed issue whole life and universal life products. Finally, AIG offers what it deems “Quality of Life Insurance” products, which combine elements of standard life insurance policies and add capabilities that can help families in the event of certain life emergencies.

It almost seems as if AIG is set on proving that there truly is a life insurance product for everyone.

How AIG’s premiums stack up

AIG is neither the cheapest nor the most expensive insurance agency for policies with lower coverage amounts or for shorter-term policies. However, if you are on the hunt for a policy with a large benefit and/or a longer-term policy, you’ve come to the right place. AIG has some of the best premiums for these types of plans.

AIG sample rates per month*

AIG sample rates—50 y.o. man
$100,000 $250,000 $500,000 $1M
10-yr. $62.24 $126.67 $241.45 $454.35
20-yr. $86.53 $171.13 $333.79 $651.85
30-yr. N/A N/A N/A N/A
Whole $226.47 $238.70 $934.67 $1,737.99

AIG sample rates—25 y.o. man
$100,000 $250,000 $500,000 $1M
10-yr. $9.32 $22.57 $22.14 $24.28
20-yr. $10.69 $23.70 $25.99 $24.28
30-yr. $12.40 $23.85 $24.71 $40.53
Whole $44.97 $78.22 $146.20 $255.61

*Rates current as of 12/11/18. Sample rates reflect those of a 50-year old male smoker in good health and a 25-year old non-smoking female in excellent health. TermLife2Go.com is not licensed to sell variable  products; rates and information provided are for illustration purposes only.

Prices will vary across AIG’s many different insurance products depending on what specific iteration a policyholder seeks and if they add any riders onto the policy. To get a better idea of what a specific AIG policy premium will look like for you, visit AIG’s website and request a quote. Just keep in mind that by turning over your contact information, you can expect a call from a sales representative soon.

Receiving a single quote won’t really help you figure out if that particular insurance product is a good deal for you. So, take the next step and check out our various life insurance company write-ups. Whenever possible, we try to include similar quote charts.

AIG history and financial strength**

AIG Ratings
A.M. Best8 A
S&P9 A+
NAIC10 0

**All ratings current as of 12/20/18. Ratings reflect the evaluations of rating agencies but are not intended as a recommendation to purchase from any company. Rating agencies may update, suspend, or withdraw their ratings at any time.

The American General life insurance rating from top agencies like A.M. Best, Moody’s, and Standard & Poor’s are strong, indicating that the company is on solid financial footing. It is worth noting, however, that Standard & Poor’s gave AIG a “Negative” outlook, meaning the company’s prospects may be headed in a downward direction. This is definitely worth keeping an eye on since your policy hopefully won’t need to pay out for many decades into the future.

NAIC’s rating of 0 refers to the ratio of complaints AIG receives. This is NAIC’s lowest ratio, which would seem to indicate that AIG offers superior customer service; however, outside evidence would suggest otherwise, as we’ll detail later in this article.

AIG claims and customer service

It looks like AIG might be getting the message that it needs to treat its customers better.

Perhaps the biggest splotch on AIG’s newly polished reputation is its dismal customer service record. J.D. Power & Associates surveyed customers of 23 large life insurance agencies, and AIG limped into 22nd place. Its second-to-worst performance isn’t exactly comforting for anyone thinking about paying premiums to the company on the promise of a big payday decades into the future.

If you need a glimmer of hope, perhaps you can take heart in how the National Association of Insurance Commissioners recorded “only” 286 complaints about the company in 2018. Compare that to 420 complaints in 2017 and 412 complaints in 2016, and it looks like AIG might be getting the message that it needs to treat its customers better. A majority of the NAIC’s recorded complaints were in relation to AIG’s life insurance products, and they ran the gamut, including cancellation of policies, billing issues, failure to credit premiums, delays, and more.

It’s worth recognizing that AIG is a truly massive company, so 286 complaints in a year isn’t really that large of a percentage of its total customer base. If you really like the company’s insurance products, you may decide it’s worth the risk of enduring a few customer service bumps and bruises along the way.

Bottom line: AIG has it all (except good customer service ratings)

If you want lots of choices, highly customizable plans, and the flexibility to change your life insurance as your personal situation alters, then AIG is an excellent option for you. When it comes to life insurance plans, AIG truly has it all. Almost any customer can find a plan to their taste and add a few riders to further customize it to their needs. AIG also makes it easy for customers to start with one of its term life policies and then upgrade to a permanent policy when they’re ready.

With strong ratings and a (mostly) stable outlook, it seems AIG’s financial stumbles are in the past and customers can once again put their faith in this company. While its customer service ratings are its biggest weakness, you may wish to overlook this flaw in exchange for working with a company that seems committed to designing a life insurance plan just for you. If so, get a life insurance quote today.

Of course, if you truly want as many life insurance options as possible, then you should see what other companies have to offer. Take a look at our list of top ten best life insurance companies to see if AIG made the cut.

For more personalized service, give us a call today to speak to a helpful life insurance representative.


FAQ about AIG

Still have questions about AIG? These FAQs may help.

Can I borrow money from my AIG life insurance policy?

AIG offers a variety of policies that allow you to borrow against your cash value or even against your death benefit. In particular, you can take a loan against the cash value of your whole life or universal life policies if you have enough savings built up. AIG also offers certain Quality of Life plans that let you borrow against your death benefit.

Can I switch from term life insurance to whole life insurance?

AIG’s Select-a-Term life insurance policy allows you to convert it into permanent life insurance (such as whole life or universal life) at any time up until the end of your policy’s term. You won’t have to undergo any additional underwriting, and your term life payment may even be credited toward your new policy’s premium.

How does Quality of Life insurance work?

AIG’s Quality of Life products may sound unusual, but they are essentially the same types of life insurance products AIG already offers. The major thing that sets Quality of Life Products apart is that they automatically include a “living benefits” component.

Though each product works a little differently, all of them allow you to access your full benefit (up to $2 million) or take out loans against your policy in the event of qualifying terminal, chronic, or critical illness. The idea is that you and your family can maintain your current “quality of life” even in the event that luck turns against you. For more information on AIG’s specific Quality of Life policies, visit https://www.aig.com/individual/insurance/life/quality-of-life-insurance.

What is AIG Direct?

If you spend time wandering around AIG’s website as we did extensively for this article, you’ll regularly and somewhat inexplicably end up on a page for AIG Direct.  AIG Direct seems to sell the same policies as AIG, so what gives?

It turns out that AIG Direct is a life insurance company, and its policies are underwritten by AIG. In truth, there seems to be very little difference between the two companies, except that AIG Direct sells its policies online or through a call center, while AIG relies more on life insurance agents.


Disclaimers

ǂ A.M. Best’s financial rating scale is the following: A++ (Superior), A+ (Superior), A (Excellent), A- (Excellent), B++ (Good), B+ (Good), B (Fair), B- (Fair), C++ (Marginal), C+ (Marginal), C (Weak), C- (Weak), and D (Poor). A.M. Best’s Financial Strength Rating (FSR) is an independent opinion of an insurer’s financial strength and ability to meet its ongoing insurance policy and contract obligations. An FSR is not assigned to specific insurance policies or contracts and does not address any other risk—including, but not limited to, an insurer’s claims-payment policies or procedures; the ability of the insurer to dispute or deny claims payment on grounds of misrepresentation or fraud; or any specific liability contractually borne by the policy or contract holder. An FSR is not a recommendation to purchase, hold, or terminate any insurance policy, contract, or any other financial obligation issued by an insurer, nor does it address the suitability of any particular policy or contract for a specific purpose or purchaser.

Sources

1.  Ty Steward, SimpleLifeInsure.com

2.  U.S. Securities and Exchange Commission, “Litigation Release No. 19560 / February 9, 2006

3.  Insurance Journal, “Timeline of U.S. Government’s Rescue, Sale of AIG

4.  Insurance Journal, “Timeline of U.S. Government’s Rescue, Sale of AIG

5.  Ty Steward, SimpleLifeInsure.com

6.  AIG, “AoL Flex Term

7.  Ty Steward, SimpleLifeInsure.com

8.  A.M. Best, “American General Life Insurance Company

9.  Standard and Poor’s, “American General Life Insurance Co.

10.  NAIC, “American Gen Life Ins Co

11.  Ty Steward, SimpleLifeInsure.com

12.  J.D. Power, “Life Insurers’ Focus on Customer Experience Is Key for Increasing Satisfaction, J.D. Power Finds”

13.  NAIC, “American Gen Life Ins Co Complaint Trend Report

14.  NAIC, “American Gen Life Ins Co Complain Counts By Code Report

15.  Ty Steward, SimpleLifeInsure.com


20 comments... add one
    • TermLife2Go

      Douglas,

      We would love to send out some information to you, but without knowing more about what you’re looking for we wouldn’t know where to start!

      For this reason, we’ll have an agent reach out to you so that we can get a better idea about what you’ll find most interesting.

      Thanks,

      TermLife2Go.

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