Prudential Life Insurance Company Review

Established in 1875, Prudential is now among the industry leaders in insurance and asset management. Operating out of a headquarters in Newark, New Jersey, Prudential and Prudential Life Insurance now handle $667 billion in assets under management. Standard and Poor's rates them at AA- for claims paying ability, while Moody's and Fitch both rate them at A+.

Prudential Life Insurance currently offers a full array of insurance products including term and permanent insurance contracts. Permanent insurance policies include universal life, variable life, and survivorship life. Here is a brief look at each type of policy currently offered by Prudential Life Insurance and it's subsidiary companies.

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Term Life Insurance

In most states, Prudential offers three variations of term life policies. The budget friendly policy is 'Term Essential', and is offered for terms of 10, 15, 20, and 30 years. Though even this entry level policy offers a conversion option to permanent insurance, it is a basic term policy unless you choose to convert it and start accumulating some cash value. This type of policy is great for a family or person with some insurance needs and a tight budget, but wanting options for the future.

The second variant on term offered by Prudential is 'Term Elite'. Offered with the same term periods as Term Essential, Term Elite adds a more generous option for conversion to permanent insurance. Policy owners can exercise this option up to the age sixty five or within five years of issue, whichever is later. A nice and unique bonus is available for exercising this conversion option within the first five years -- a credit toward the permanent policy’s first year.

The most advanced term offering is Prudential's 'PruLife Return of Premium Term', is available with 15, 20, or 30 year terms. This type of policy also offers an option to convert to permanent insurance. The namesake feature of the policy is that Prudential will return all out of pocket premiums at the end of the level premium period. This type of policy will typically have a higher premium, but the return of premium later provides a unique combination of protection now and the flexibility to continue insuring or reinvest at the end of the term.

Universal Life Insurance

Prudential currently has two variations of universal life insurance, both offering the flexibility and protection expected from the industry. 'PruLife Universal Protector' is a universal policy with protection guarantees for a lifetime or the chosen shorter period. There is flexibility on when and how much premium is paid, as well as two death benefit options and the potential for tax deferred cash value accumulation. This policy is suited for a family that demands lifetime protection and maximum flexibility of premium payments.

The second universal policy available from Prudential is 'PruLife Universal Plus'. This policy offers flexibility of premiums, three death benefit options, and shorter term protection periods based on premiums paid. Families that require shorter periods of protection can take advantage of the competitive rates on cash value accumulation with this policy.

Variable Life Insurance

There are just two versions of variable insurance, one pure variable policy and one VUL (variable universal life). The 'PruLife Custom Premier II' policy offers some flexibility with premiums and a number of death benefit options. The policy does provide options for withdrawals, loans, a moderate variety of investment choices, as well as an lengthy ten year CDSC (contingent deferred sales charge - a.k.a. early withdrawal penalty) if the policy is cancelled. A policy holder can choose to add options like an increase or decrease in death benefit or even a return of premium death benefit.

The 'VUL Protector' policy provides the same features of the Custom Premier II with additional options and flexibility. The policy holder can choose between a fixed or variable death benefit, the latter of which will fluctuate with the cash value. Beginning in year thirteen, Prudential adds a customer loyalty credit. Another nice option with this policy is the opportunity to guarantee your death benefit regardless of market conditions along with the potential for tax deferred cash value. This type of policy is worth consideration if a family does not qualify for Roth IRA deposits (higher income families).

For a family earning too much income to contribute to a Roth IRA, Prudential’s 'VUL Protector' policy is great way to put money away to access later with tax benefits. Further, it provides some amount of guaranteed protection in the meantime. Variable universal life policies can be a valuable financial tool for tax planning and wealth preservation.

Survivorship Life Insurance

The 'PruLife SUL Protector' is a permanent survivorship policy, otherwise known as second-to-die policy. This wealth preservation tool offers limited flexibility with premiums and death benefits. Families wanting to preserve wealth or more concerned with protection than cash value will find this a useful financial tool.

Summary and Highlights

Overall, Prudential is a solid brand and sound financial services provider, carrying a decent credit rating and good ratings for ability to pay benefits. Prudential Life Insurance began as a working class insurer and continues to offer value to policy holders. Investors may desire more flexibility and quality money management choices, however there are good options available with Prudential. Their structure for insurance offerings is a bit more simple than it's competitors, primarily offering an entry level policy, a step up, and a 'premier' policy for each type of insurance.

Depending on the state, there areplenty of useful options and riders available on many of the policies. Competitive pricing on term policies and premium return options are very attractive. Remember, it's the cost of insurance (essentially term insurance) that comes out of premium payments or interest earned. This means that a better price on the insurance costs built into the policy will translate into MORE CASH VALUE.

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