If you’re a member of the military researching your life insurance options, there’s a good chance you’ve heard of American Fidelity Life Insurance Company.
If you’re a civilian, the name above probably isn’t on your radar.
But just because the carrier isn’t as heavily marketed as some of its competitors doesn’t necessarily mean you should write it off.
You also need to look at the company’s policies, features, and financial strength to judge it.
Our American Fidelity Life Insurance Company review pulls back the curtain to give you a closer look at what this provider has to offer you.
Our American Fidelity Life Insurance Company Review
American Fidelity isn’t your average provider.
Like many life insurance companies, it was built with the intention of filling a gap to provide protection for people in need.
However, unlike most, American Fidelity was designed with military families in mind.
The company, which is linked to Trans World Assurance, was founded by WWII veteran Charles Woodbury in 1956 after Woodbury noticed a lack of life insurance and financial planning companies catering to military members.
The company still places importance on military families to this day, underwriting for SGLI, or Servicemembers Group Life Insurance.
Similar to USAA, the company’s close focus on military families allows them to specialize in one key niche and truly cater to their unique needs.
Over time, the company has expanded this focus to include the rest of the population.
Today, American Fidelity offers quality life insurance benefitting non-members of the military as well.
In addition, American Fidelity strives to provide simple, straightforward service. They don’t take a complex approach to life insurance, instead preferring something more traditional.
The stripped-down nature of both American Fidelity’s products and their website and application process makes them a considerable choice for those seeking simple life insurance without any bells and whistles.
Financial Strength and Ratings
Along with looking to the past, it’s important to look to the present and financial future of American Fidelity.
It is imperative to work with a reliable and financially stable carrier when you make a purchase as significant as life insurance.
With over $400 million in assets, American Fidelity appears to be in good financial standing.
But we can look beyond the company’s performance to evaluate its viability, using credit ratings as a measure of financial strength.
Currently, American Fidelity is only rated by one of the major credit rating agencies, A.M. Best.
A.M. Best gives Fidelity a “B++” rating, suggesting it has a “good” ability to keep its financial promises.
While this rating is fairly favorable, there are dozens of “A” level providers you can count on for coverage.
In addition to credit ratings, the Better Business Bureau provides helpful insight into customers’ perceptions of the company.
American Fidelity has been accredited with the BBB since 1987, with a current rating of “A+.”
You should take each of these factors into consideration as you consider the company.
American Fidelity, in partnership with Trans World Assurance, offers a number of versatile life insurance policies.
In the section below, we’ll highlight all of the term and permanent policies you can purchase from American Fidelity.
If you’re in the military, you can get a group term life insurance policy from American Fidelity.
These affordable term life insurance policies are provided through the Servicemembers’ Group Life Insurance.
American Fidelity was one of the founding members of the SGLI and continues to underwrite these policies.
After your service is up, you can also convert your SGLI policy into permanent coverage with Trans World.
American Fidelity also offers universal life insurance to all applicants, regardless of military status.
With Future First, the company’s signature universal product, you get flexible premiums and a death benefit that can be adjusted according to your needs.
American Fidelity’s IULs are considerably safe, primarily investing in treasury bonds with some corporate bonds.
Trans World guarantees the Future First will accrue a minimum of 3% interest.
American Fidelity and Trans World offer three types of whole life insurance.
Here’s a quick overview of what each one encompasses:
- Flexible Dollar Builder Whole Life Insurance: The FDB plan offers applicants whole life insurance with a guaranteed death benefit on a 10-pay, 20-pay, or level plan.
- Traditional Whole Life Insurance: The company’s basic whole life insurance can be issued through age 60, with face values ranging from $2,500 to $150,000.
- Twenty Pay Graded-Benefit Whole Life Insurance: Last, American Fidelity’s graded policy, which maxes out at $10,000, pays out all premiums in the first two years (plus 10%) with full death benefits available after two years.
These policies are portable and come with no war clause for military personnel.
Additional riders are also available, enabling you to further tailor each of these policy types to your personal preferences.
How to Apply for American Fidelity Products
American Fidelity’s entire application is simple and straightforward. It takes less than 15 minutes to apply for traditional coverage.
Of course, you should be prepared to answer several questions based around topics such as your:
- Overall health
- Diseases or illnesses
- Family health history
- Lifestyle (smoking and drinking)
- Work and activities
This risk assessment from your answers will be the basis of your coverage and rates.
You’ll be required to take a medical exam to qualify for service, then you can expect to wait between 4 and 6 weeks for approval after applying.
Despite their bare-bones approach to life insurance, there’s a lot to like about American Fidelity.
Here are a few of the company’s most notable attributes:
- Reputation: Though you won’t glean much from the company’s website or encounter much marketing from American Fidelity, they do have a long history of success in the industry.
- Strong support of military families: American Fidelity is resolute in its support of the men and women who protect our nation and their families, as reflected in their policy features and customer service.
- Policy lineup: If you’re looking for a versatile selection of policies, American Fidelity has you covered with a variety of term and permanent solutions.
- Simple application process: Though American Fidelity’s traditional underwriting process might seem to drag on, the application itself is short and straightforward.
- Customer service: Customer service is highly prioritized by American Fidelity. Representatives are easy to contact by phone or email.
American Fidelity might not stand out from the competition on many fronts, but there aren’t a lot of negative qualities.
Regardless, here are a few of American Fidelity’s negative qualities:
- Credit rating: Though it’s not in poor financial standing, American Fidelity’s rating is below average and only driven by a single rating agency.
- Small market: While American Fidelity is open to the public, many of its policies are targeted towards the military, with other applicants faring better elsewhere.
- Limited policies: A lot of American Fidelity’s products have small policy limits which might not be adequate to replace income, pay off major debts, or leave a legacy.
- Online presence: American Fidelity’s website is far from user-friendly and provides inadequate information on its policies, features, financials, and application process.
American Fidelity is hard to beat if you’re a service member, with many of the company’s policies designed specifically with service members and their families in mind.
Beyond that, American Fidelity offers solid policies for everyone else.
Though American Fidelity might not be our first choice in general, they faithfully protect millions of Americans each year.
Regardless of your thoughts on American Fidelity, you should never limit your search to just one company.
Outline your policy needs, compare quotes, and start exploring your options today.