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This Ameritas Life Insurance review will cover Ameritas’ financial strength, company history and product overview.
Ameritas Life Insurance Corp. and Ameritas Life Insurance Corp. of New York (“Ameritas”) are among the many subsidiaries of Ameritas Mutual Holding Company. Ameritas Life Insurance Corp. is located at 5900 O Street Lincoln, NE 68510, Ameritas Life Insurance Corp. of New York is located at 1350 Broadway Suite 2201 New York, NY 10018. The best phone numbers to reach them are 800-745-1112 and 866-696-7478.
Ameritas Life Insurance Financial Strength
Standard & Poor’s rates Ameritas at A+ (Strong) for insurer financial strength. This is the fifth highest of Standard & Poor’s 21 ratings. A.M. Best Company rates it at A (Excellent) for insurer financial strength. This is the third highest of A.M. Best’s 13 ratings.
Financially, Ameritas had a good year in 2017. For the year ended December 31, 2017, Ameritas grew GAAP pretax income to $157.5 million, up 13.0 percent from 2016. Total GAAP assets rose 8.0 percent to $23.1 billion in 2017, and total insurance revenues, net investment income and other revenue totaled $2.2 billion. Its total GAAP equity increased to nearly $3.1 billion in 2017. Ameritas made $3.0 billion in benefit payments to policyholders in 2017. Its customer base is about 4 million.
The Chief Executive Officer of Ameritas is JoAnn M. Martin, CPA, FLMI. Its President and Chief Operating Officer is William W. Lester, CFA, FLMI
Ameritas Life Insurance Corp. Company History
In 1887 five local businessmen formed “The Old Line Bankers Life Insurance Company of Nebraska (Bankers Life),” which immediately became the only local insurance company in Lincoln, Nebraska. During the first half of the 20th century Bankers Life grew from a small company serving a limited Midwest geographical area to one of the nation’s 100 largest insurance companies with operations extending to both coasts.
In 1988, Bankers Life changed its name to Ameritas Life Insurance Corp. Ameritas Life Insurance Corp. of New York is a subsidiary that provides insurance products and services to the New York market.
Ameritas Life Insurance Products
Life insurance products offered by Ameritas include index universal life (which also includes “Ameritas Growth IUL”), universal life, whole life, term life and variable universal life insurance. Each product type has its own advantages and disadvantages.
1. Index Universal Life Insurance helps minimize uncertainty by protecting those you care about and helps maximize the future by giving you the potential to accumulate value to help fund your future plans. The cash value accumulation is linked, in part, to the performance of a fixed account or the S&P 500® Index or another equity index.
A. Downside Protection
Although index universal life insurance provides the potential for interest accumulation linked, in part, to an equity index, you’re not directly investing in equities so you have more protection. Your policy’s account value is protected from market loss and may even earn a minimum guaranteed interest rate.
For example, if the S&P 500 Index increases, excess interest above the guaranteed interest is credited and locked in at the end of the 12 month Index Period. The new Account Value is used as the starting point for the next Index Period. If the S&P 500 Index falls below the initial starting point, you still receive a positive return since a minimum interest rate is guaranteed. You enjoy the growth potential of the S&P 500 Index while preserving your account value during market downturns. Once interest has been credited, it cannot be lost due to any future decreases in the S&P 500 Index.
B. Other Features of Index Universal Life Insurance
Policy fees and charges will reduce the policy’s value. Also, when you borrow money from your Excel Index UL policy, you’re using the policy’s cash value as collateral and are borrowing against your own money. Thus, there is no need for lender approval and no effect on your credit report. Your policy allows you to choose when and how you pay premiums. And, if you experience twists and turns in the road ahead, you can pay more or less than you planned.
2. Universal Life Insurance is permanent insurance that provides protection in case of death as well as a savings or cash value component. Universal life insurance has no maturity date. As long as your policy maintains a positive cash surrender value, the policy remains in force.
A. Growth Potential
You can use the cash value of your universal life insurance policy to help pay for college, to supplement your income during retirement or for other financial needs. The cash value of the policy grows tax-deferred based on the premiums you pay, the declared interest rate and the policy charges. Using the policy’s cash value will lower its death benefit.
Within certain guidelines, you can choose when and how you pay your premiums. You can pay less when money is tight or more when you want to increase your policy’s cash value. Generally, you can vary the benefit amount as well, based on your current protection needs. You can also customize your policy and make changes as your life changes.
3. Whole Life Insurance builds a strong foundation of permanent protection
Purchasing a Whole Life policy guarantees a death benefit that will not decrease, a premium that will not increase and cash value that earns a guaranteed interest rate, creating a good foundation for family protection. It builds cash value that grows tax-deferred, helping you accumulate even more over the long term. While it may reduce the amount of death benefit your policy provides, you may be able to use the policy’s cash value to help pay for college, to supplement your income during retirement or for other financial needs.
Although not guaranteed, whole life policies generally receive annual dividends, which can be used to build additional cash value, to increase the policy’s death benefit or to reduce the number or amount of premiums.
You can customize your whole life policy to meet your needs and you can make changes as your life changes. If you can commit to paying an ongoing level premium and are looking for protection to last a lifetime, whole life insurances offers strong policy guarantees and cash value that grows with a conservative approach.
4. Term Life Insurance is the cheapest way to obtain maximum coverage effective immediately. You choose how much protection you want to provide and how long you want it to last. The trade-off is that the policy does not grow in value.
Generally, term insurance provides a higher benefit at a lower cost than permanent life insurance because protection is provided for a limited period and, as stated previously, the policy does not grow in value. It is a cost-effective way to cover a shorter-term need. Your premiums remain level for the term you select and your death benefit is guaranteed never to decrease as long as you pay the required premiums. Guarantees are backed by the claims-paying ability of Ameritas.
Term life insurance may be a good fit for you if your need for insurance is temporary, you want the most death benefit possible for the least amount of money and/or you believe that in spite of the tax advantages associated with other types of life insurance, you can obtain a better rate of return using a different investment vehicle.
5. Variable Universal Life Insurance provides a death benefit which is generally paid income tax free to your beneficiaries without the delays and expenses of probate—a benefit only available with life insurance.
With variable universal life insurance, a portion of each of your premium payments can be invested in your choice of investment options. These portfolios are managed by respected names in the mutual fund industry. You have the freedom and flexibility to choose any number and combination of investment options and money managers to suit your goals and risk tolerance — all within the convenience of one product. Of course, investing does include the risk of loss, including principal.
6. Ameritas Growth IUL was unveiled on June 5, 2018 as a new life insurance product evolving the chassis of its “popular” existing index universal life product with several updates and changes. Ameritas claims Ameritas Growth IUL indeed provides a death benefit, but is “set apart” by certain other features and benefits:
“• A 10-year lookback guarantee of four percent. Guarantees credited interest will equal at least four percent compounded annually over the first 10 years for account values allocated to the index strategies.
• Lifetime income rider. Guarantees the client income for life, providing protection for the client’s retirement income if they live too long.
• Care4Life 2.0 rider. Provides a guaranteed accelerated death benefit for chronic, critical or terminal illness with 18 qualifying triggers.
• Index credit enhancement. Offers an additional 10 percent of the index credit starting in year six, helping to accumulate long-term cash value.
• Early cash value rider. Generates higher cash surrender value in the early years of the policy
without sacrificing long-term performance.
• Broader choice of index strategies. Offers more flexibility and options, appealing to a wider range of clients.”
Ameritas is a great company with unique strengths depending on your situation. We highly recommend their FLX Term product line as well as their IUL FLX products that include living benefits.
Ameritas has some of the best living benefits in the industry. Living benefits means your policy pays out a portion of the death benefit under 18 triggers – including heart attack, cancer, stroke etc.
On top of that, their Indexed Universal Life Insurance product is consistently rated as one of the best in the industry when spreadsheeted against other Indexed products.
For those 2 reasons, we consider Ameritas one of the best life insurance companies available on the market today.
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