Pros / It has lower premiums for permanent policies than some of its competitors.
Cons / Prudential’s term policies tend to be more expensive than comparable plans elsewhere.
Verdict / Prudential has good prices for permanent plans and a variety of financial resources. This makes it a good option if you’re using life insurance as part of a retirement plan.
A.M. Best, an organization that grades insurance companies’ financial stability, rates Prudential at an A+, which means it’s financially secure and will be able to pay out claims far into the future. Prudential also offers mutual funds, annuities and other financial planning services.
At Prudential, you can choose between the two main types of life insurance policies: term and permanent. Term life insurance is the most common type – it covers you for a pre-determined number of years and pays a set amount to your beneficiaries if you die during that term. Permanent life insurance is more complicated because it doesn’t expire and has a life benefit in addition to a death benefit. A permanent policy builds value over the course of its life by accruing interest and earning dividends. Permanent policies are more expensive, costing up to 10 times more than term policies.
Premium costs are based on many different factors, including your age, sex, health, income, debt and savings. During testing, we got term and permanent life insurance quotes using two scenarios. One was a 45-year-old man who smokes and is in good health, and the other scenario was a 33-year-old woman in excellent health. We used the same income and debt for both scenarios.
Prudential’s term quotes were more expensive than average, with policies that cost more than similar offerings at State Farm and Northwestern Mutual. Our 45-year-old was quoted $154 a month, and the average across all the companies we reviewed was $144. The 33-year-old was quoted a premium of $28 per month, which is by far the most expensive term policy we saw for that individual.
Prudential is one of the best options if you want a permanent life insurance policy. It quoted us much lower rates than the other insurers. Our 33-year-old woman received a quote for $113 a month, which is the lowest cost we found for a permanent policy. At $425 a month, our 45-year-old man’s quote was also on the low end, about $60 below average.
Unlike other life insurance companies, Prudential only offers universal permanent policies. They are more flexible than whole life insurance, and the premiums and payout can be adjusted depending on your financial situation. Whole life policies are much more rigid once they’ve been established. Prudential’s universal policies are indexed to the S&P 500, so it earns interest relative to how well the market performs.