American Family Life Insurance Review 2024

Have you seen the new ad campaign for American Family Insurance? It features Jennifer Hudson (best known for Dreamgirls) surprising aspiring musicians and singing a duet with them.

The series of TV commercials are designed to reinforce American Family Insurance’s belief that “Everyone has a dream. With the right protection and support, imagine what you can achieve.”

That’s a powerful statement. But is the protection and support they offer right for you?

Here, we take a look at the products, reputation, and relevant company history of American Family Life Insurance.

Be careful to not confuse this company with the American Family Life Insurance Company of Columbus. They are not affiliated in any way.

Looking to compare life insurance prices? We can help. Enter your ZIP code to get free quotes from multiple insurers.

History of American Family Insurance

The American Family Life Insurance Company is a subsidiary of American Family Insurance. The Wisconsin-based parent company is sometimes called AmFam. It began in 1927 when its owner sold auto insurance to farmers.

Today, American Family Insurance is a Fortune 500 company that sells a wide range of products. These include homeowners, car, snowmobile, flood, travel, and life insurance.

According to their 2016 annual report, approximately 9.6% of their 8.3 million active policies are for life insurance. That makes life insurance a small part of their business.

It can be difficult for a company to manage risk when it doesn’t hold many of one type of policy. Higher premiums are a common solution to this problem. American Family doesn’t make its life insurance rates public. Due to this, we can’t know for certain if this scenario applies to them.

American Family offers four types of life products, which we outline in the following sections.

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Term Life Options with American Family

The company offers 10-year, 20-year, and 30-year term insurance. Following the standard practice, neither premiums nor benefit amounts change while the policy is active.

They also offer several riders, which are options for extra coverage. The most common are:

• A rider for $10,000 worth of coverage on natural, adopted, and stepchildren of the primary insurer
• A rider that waives premiums if the primary insured becomes totally disabled
• A rider that provides the beneficiary with an additional death benefit, up to $100,000 if the cause of death is a policy-defined accident

AmFam’s term life policies also have an accelerated death benefit option. This feature allows the policy owner to collect part of the death benefit if the primary insured is diagnosed with a terminal illness and certain conditions are met.

In some cases, term life policyholders could have the option to convert their term insurance to permanent insurance without evidence of insurability.

Simply Protected Term Life

This is a term product with no medical exam. Consumers only need to complete a brief health questionnaire with their application.

The greatest advantage of this product is the speed and ease of the streamlined application process.

But there are also drawbacks. In exchange for no medical exam, there are tighter underwriting conditions.

Be aware that premiums could be higher with this kind of term insurance. Higher premiums help offset the greater potential risk to the company.

Plus, there is a cap of $150,000 on the amount of insurance coverage that can be purchased through the SimplyProtected Term Life product. This is another risk-mitigating feature for the company that could make the product an unsuitable choice for many families.

Quick Tip:
If you’re considering a no medical exam term life insurance, be sure to check out our full review of the companies that offer this coverage. We currently have companies that offer up to $1,000,000 without a physical.

Whole Life

Whole life insurance offered by American Family is straightforward. It offers permanent protection with a guaranteed death benefit for the life of the insured as long as the premiums are up to date and standard conditions are met.

Medical exams are standard practice when buying permanent insurance.

Riders, or extra coverage, are available with this product. The most common are:

• A rider for $10,000 worth of coverage on natural, adopted, and stepchildren of the primary insured
• A rider that allows the purchase of extra permanent life insurance at specified dates and life events without the requirements of medical questions or examination
• A rider that waives premiums if the primary insured becomes totally disabled
• A rider that provides the beneficiary with an additional death benefit, up to $100,000 if the cause of death is a policy-defined accident

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MyLife Flexible

American Family Life Insurance describes their MyLife Flexible product as adjustable life insurance that can change as your life evolves. (For more information, read our  Life Insurance 101: What are the pros and cons of an adjustable life policy?“).

Applying for MyLife Flexible insurance is the same as with Whole Life. The available riders are also the same.

But it differs from Whole Life in a few ways. It includes living benefits such as the accumulation of cash value, and the option to change the amount of coverage and required premium.

When you purchase one of these policies from American Family Life Insurance, you have two options for flexibility: MyLife Freedom and MyLife Legacy.

MyLife Freedom is an option that provides higher amounts of coverage during the years when financial responsibilities are high. This is often when there children at home, a mortgage, or other major debts.

This option also allows for a reduced coverage amount during retirement. In that case, no payment of premium is necessary after age 65 or 20 years after policy purchase, whichever is later.

MyLife Legacy is an option that focuses on wealth-building. It’s designed to offer flexibility for building the coverage and cash value of the policy throughout the life of the policy.

Reviews and Ratings

There are no official documented reviews or ratings of American Family Life Insurance. This is not surprising, given the relatively small number of life insurance policies they hold.

For what it’s worth, reviews of the parent company, American Family Insurance, aren’t favorable, on average. Still, the Better Business Bureau gives the company an A rating.

People buy American Family Insurance through agents. The company considers these agents to be independent contractors. But in August 2017, an Ohio judge ruled that the agents are company employees and are, therefore, entitled to be given retirement benefits as such.

The ruling, if held up during an appeal, could cost the company approximately $1 billion in retirement benefits.

Closing Thoughts on American Family Life Insurance

When it comes to life insurance, American Family Life Insurance is a small company. That could make it difficult to get the best premium rates and/or conditions of coverage.

People who hold other kinds of insurance policies with American Family Life might receive a small discount. But it is unlikely to be significant considering the size of the company’s block of life insurance business.

So, is American Family Life the best insurance company to protect and support your dreams? Comparison shopping based on your specific circumstances is the best way to find out.

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Looking to compare life insurance prices? We can help. Enter your ZIP code to get free quotes from multiple insurers.

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