Prudential Term Essential and Term Elite Review
Prudential’s Term Essential and Term Elite products are two term life insurance products that are similar in many ways except for a couple of features. The Term Essential product is considered a simple term product for those who need affordable level term coverage that is convertible to permanent coverage in the future. Term Elite also offers affordable level term coverage but is geared for those who are going to convert to permanent coverage by offering a conversion credit if converted within the first 5 years. Let’s take a closer look at these two products and how they compare.
Term Essential – Term Essential is an excellent option if you are simply looking for affordable level term coverage with the option to convert to a permanent product. Prudential offers a very generous conversion option with this simple product in that you can convert your Term Essential policy into ANY of Prudential’s permanent products. Many other companies restrict conversion to only certain permanent products at their discretion (usually the higher priced products), so this is an excellent feature for a simple term product.
Term Elite- Term Elite also offers affordable level term coverage, but along with the option to convert to ANY of Prudential’s permanent policies there is an added conversion feature. If you convert your policy to any of Prudential’s permanent products within the first 5 years, you will receive a conversion credit. The conversion credit will equal the term premiums due and paid during the 12 months prior to the conversion excluding any premium or charge for an extra risk or benefit other than Waiver of Premium. In other words, you will basically get a credit towards your new permanent policy premium that is equal to premiums paid into your Term Elite policy in the last 12 months.
Conversion Age Limits for Both
For ages 59 and younger, you can convert to any permanent coverage that is offered by Prudential up to age 65 on both products. If you purchased your policy between the ages of 60 and 75, Prudential will allow 5 years for you to convert.
Other Features
Both products offer level premium periods of 10, 15, 20 and 30 years. The premiums thereafter are guaranteed with the Term Elite product but not for the Term Essential product if you decide to keep the policies in force. Both products also offer partial conversions, meaning you have the option to only convert a portion of the coverage to permanent coverage. Both products have the following available riders that can be added: Living Needs Benefit, Waiver of Premium, Accidental Death Benefit and Children’s Protection Rider. Riders are not available in all states and may only be available at issue.
Rates
Both policies are quite affordable for the benefits they provide. Below are the monthly rates for 40 year old, non-smoker, male and female applicants that have a “Preferred” rating for 20 years of coverage. Rates are as of 9/26/2014.
| Male | $250,000 | $500,000 | $1,000,000 |
|---|---|---|---|
| Term Essential | $30.83 | $54.00 | $94.05 |
| Term Elite | $33.98 | $60.30 | $101.25 |
| Female | $250,000 | $500,000 | $1,000,000 |
|---|---|---|---|
| Term Essential | $24.98 | $42.30 | $74.25 |
| Term Elite | $27.45 | $47.25 | $80.55 |
The Company
Prudential has been around for over 135 years and is one of the most recognizable names in the insurance and financial services industry. They have over $3.5 trillion of gross life insurance in force worldwide and are the second largest life insurer in the United States. The company has an A+ rating from A.M. Best, AA- rating from Standard & Poor’s, A1 rating from Moody’s and an A+ rating from Fitch Ratings. Anyone purchasing an insurance product from Prudential should feel extremely confident the company will be able to pay its obligations. The company has an excellent reputation for customer service and was ranked 3rd by Forbes Magazine for the “World’s Most Admired Companies” in the Insurance: Life and Health category.
Conclusion
Prudential’s Term Essential and Term Elite products are an excellent choice when it comes to affordable term coverage. They both have the option of converting to any of Prudential’s permanent products which is not common in the industry. If you are certain that you will convert your term policy to a permanent policy within 5 years, Term Elite is the way to go. The conversion credit could knock a substantial amount off of your first permanent policy premium. If you are not certain that you will convert but would still like to have the option, Term Essential may be the best choice. The premiums for these two products are slightly higher but still competitive compared to other term products in the industry. But when you consider the company’s liberal conversion feature, either product may be worth the slightly higher premium. Prudential is also known for their liberal underwriting which is an added bonus for people who have slight health issues.
If you are interested in a quote or more information on either of these products, please feel free to give us a call at (888) 687-9444 or email us at info@archstoneagency.com.
Archstone Insurance Services, LLC is an independent agency that shops over 40 of the top life insurance carriers to provide huge savings on life insurance coverage for our clients. We are happy to answer any questions you might have about any of the insurance products we offer, your planning needs or your existing coverage. Feel free to call us directly at (888) 687-9444 or email us at info@archstoneagency.com. You can also visit our website at www.archstoneinsurance.com.
