USAA Life Insurance Review: Top Customer Service for Military Servicemembers and Their Families

This life insurer is a good fit for: Active duty service members who want to take advantage of USAA's additional life insurance features.

• Average costs:
  • Standardized scenario 1: 35-year old healthy male, $500,000 30-year term-life policy $38.74 a month ($23.95 for $250K; $64.99 for $1 million)
  • Standardized scenario 2: 35-year old healthy female, $500,000 30-year term-life policy $32.90 a month ($20.40 for $250K; $54.99 for $1 million)
• Term life policy limits:
  • Level Term: $100,000 to $10 million
  • Essential Term: $100,000
• Whole life policy limits:
  • Simplified Whole Life $25,000 to $10,000,000
  • Universal Life: $50,000 minimum
  • Guaranteed Whole Life $2,000 to $25,000
• Riders/Add-ons:
  • Protection for children rider
  • Military Future Insurability rider
  • Military Severe Injury Benefit rider
  • Simplified Whole Life Insurance Waiver of Premium
  • Disability Payment of Specified Premium (DPSP) rider
  • The Life Event Option (LEO) rider
• Eligibility:
  • Level Term: 18 to 70 years old
  • Essential Term: 21 to 35 years old
  • Simplified Whole Life: 15 days to 85 years old
  • Universal Life: 20 to 90 years old
  • Guaranteed Whole Life: 45 to 85 years old (50 to 75 in New York)
• Discounts available: N/A
• Other insurances offered: Auto, Property, Pet, Umbrella, Long-Term Care, Business, Health, Pet, Travel, Special Event, Personal Cyber, Mobile Phone, Aviation, Bicycle

Top perks

Wide variety of financial products

USAA is a financial institution that offers a wide range of products ranging from banking to retirement, and insurance products to help individuals build and manage their wealth. Although USAA is strictly for military service members and their families, anyone is eligible for a USAA life insurance policy.

Top-notch customer service

USAA is well known for customer support. The insurer has been the subject of significantly fewer complaints with the National Association of Insurance Commissioners than competitors of a similar size.

USAA consistently receives the highest score by J.D. Power on virtually all banking and insurance categories. Most USAA members report high satisfaction with the financial service provider, with the majority of people with USAA membership purchasing multiple products.

Financial stability

AM Best has rated USAA A++ (Superior, which is the highest of 16 possible ratings) and Moody's Investors Service has rated USAA Aa1 (Excellent; second highest of 21 possible ratings). S&P Global Ratings has given USAA a rating of AA+ (very strong; second highest of 21 possible ratings). These ratings mean that USAA is in a superior position to pay out claims to customers.

Policy riders and USAA military protection plus

The USAA military protection plus is an additional benefit added to USAA level term policies at no additional cost. Members receive the following features while on active duty.

Expedited coverage for service members deploying

The application goes to the front of the line, so their protection is in place before they deploy.

Coverage during time of war

In the event of death caused by war or an act of terrorism, those insured are still covered. Most life insurance companies have a war exclusion that does not cover acts of war or terrorism.

Severe injury benefits

Policyholders are covered for $25,000 if they suffer certain severe injuries in the line of duty. These injuries include dismemberment and loss of limb function, such as paralysis; loss of vision; and severe burns, as long as base policy is in effect.

Guaranteed SGLI replacement when separating or retiring from the military

USAA Level Term V Life Insurance gives policyholders the option to replace some or all of the SGLI they lose as a result of military separation or retirement, even if they are disabled.

This will let policyholders replace up to two times the coverage they already have with USAA up to the full amount of SGLI coverage ($500,000) they had in place.

This helps policyholders plan for their future by protecting their ability to get life insurance when they separate or retire from military service, even if their health has changed.

USAA also offers certain riders, including the following.

Life Events Option (LEO)

LEO is available at no additional cost with the Simplified Whole Life (SWL) insurance policy. It allows policyholders to request additional whole life insurance up to six times after specified events.

When policyholders buy a policy before they're 35 for a level term policy, they can add $100,000 of coverage if they get married, have a baby, or buy a home before they're 45.

Convertible

If policyholders have a term policy, they can convert it to permanent coverage after one year with no medical exam required.

What could be improved

Limited plans

USAA offers two types of term life insurance policies, Level Term and Essential Term and three types of permanent life insurance. While the Simplified Whole Life is offered by USAA, the Universal Life plan is offered by John Hancock and not available in New York.

The Guaranteed Whole Life is offered by Mutual of Omaha and is not available in Montana.

Few discounts available

There are few if any discounts on USAA's life insurance policies.

Few in-person locations

USAA has very few physical locations. Those who want help with a life insurance policy from an in-person agent will likely be unable to get it from this insurance provider.

The cost of a 10-year, $250,000 life insurance policy is typically between $15 and $17 per month for a healthy 40-year-old. The same policy at USAA is $15.20 for a female and $16.45 for males. USAA's costs are in line with the industry averages.

When comparing the cost of permanent policies on a "per unit" basis (the amount of premium required for each $1,000 of coverage), universal life typically costs the least per $1,000. Simplified Whole Life typically costs more than universal life per $1,000 of coverage and a Guaranteed Whole Life insurance policy costs the most.

For those who want to work with an agent in person: Among life insurance companies, State Farm offers competitive policies and customers can get a quote online or work with an in-person agent. The company provides great customer service, an online account management tool, and a dedicated agent.

For those who want customizable life insurance policies: Prudential offers flexible term and universal life insurance policies. It also has many riders that policyholders can add to build a life insurance policy that's completely customized. Its policies are widely available, but unfortunately, there's no whole life insurance option.

Term life insurance

USAA offers two term life insurance policies. The Level Term is the traditional term policy that is available for anyone aged 17 to 70. The coverage length is 10 to 30 years and the coverage amount ranges from $100,000 to $10 million. This policy includes free military protection plus benefits.

USAA's Essential Term policy does not require a medical exam but is only available for those aged 21 to 35. Coverage lasts until the age of 39 and the covered amount is fixed at $100,000 until the policy expires. This term policy does not include military protection plus benefits.

Whole life insurance

USAA offers three types of permanent life insurance policies that have different features. The Simplified Whole Life is offered by USAA, and best for those looking for lifetime coverage that's guaranteed not to change until age 121. It is available for those aged 15 days to 85 years old and coverage amounts are from $25,000 to $10 million.

The Universal Life policy is best for those who want lifetime coverage that can adjust as life changes. It is available for those 20 to 90 years old and the coverage minimum is $50,000. Coverage may go beyond the age of 121.

The Guaranteed Whole Life policy is provided by Mutual of Omaha and is best for those who need lifetime coverage without health questions or a medical exam. It is a guaranteed issue with no underwriting. It is available for those 45 to 85 years old (50 to 75 in New York) and coverage ranges from $2,000 to $25,000 (from $5,000 in Washington).

Protection for children rider

Policyholders can add their kids to their policy. When they become adults, parents can convert coverage to their own lifetime policy before they turn 26

Military Future Insurability rider

This rider provides an option to increase coverage upon separation from the military. The amount available is based on the characterization of military separation. Any increase in coverage requires an additional premium payment.

Military Severe Injury Benefit rider

This rider provides $25,000 to help with the expenses in the event of certain injuries while performing military duties. These injuries include dismemberment and loss of limb function, such as paralysis; loss of vision; and severe burns, as long as base policy is in effect.

Simplified Whole Life Insurance Waiver of Premium

Should the insured become disabled due to a covered illness or accident, USAA will pay the premiums during the disability period. This rider is available for insured ages 15 to 55.

Disability Payment of Specified Premium (DPSP) rider

Rider is available for insured age 20 to 60.

The Life Event Option (LEO) rider

This rider is available at no additional cost with the Simplified Whole Life (SWL) insurance policy. It allows policyholders to request additional whole life insurance up to six times after specified events. The rider expires at age 45.

This rider is also available at no additional cost with a Level Term V life insurance policy. It gives a one-time option to purchase additional term life insurance upon the occurrence of a life event.

Getting a term or whole life insurance quote online from USAA only takes a minute. After you get a quote, you can review the coverage options to see what fits your needs. USAA will then help you to schedule a medical exam.

You then apply for coverage after answering a few questions and completing your medical exam. USAA will review your application and after approval, you are covered after making your first payment.

While USAA is typically focused on serving the military community, all life insurance, health insurance and retirement products offered by USAA are available to the public.

USAA achieved the highest overall scores from J.D. Power in both the 2021 U.S. Individual Life Insurance Study and 2021 U.S. Individual Annuity Study.

USAA also received the highest score in the J.D. Power 2023 U.S. Auto Insurance Study. This is the 24th year in a row that USAA has achieved the highest score for auto insurance satisfaction.

In addition, USAA received the highest score in J.D. Power's 2023 U.S. Property Claims Satisfaction Survey, J.D. Power's 2023 U.S. Direct Banking Satisfaction Study, J.D. Power's 2022 U.S. Mortgage Servicer Satisfaction Study, and other customer service awards.

USAA life insurance is best suited for:

• Service members who are going to deploy to a combat zone.
• Service members who are about to leave or retire from the military.
• Those who want to take advantage of the unique riders that USAA offers.

But you may want to consider State Farm if you want to work with a dedicated agent, or Prudential if you want flexible policies with lots of customization options.