As part of our ongoing series to guide physicians into making thoughtful, well-informed decisions before buying life insurance, today we’re taking a hard look at one company in particular: Banner Life Insurance.
Here is our full provider review on Banner Life Insurance: is it the right insurance company for you?
Table of Contents
Banner Life Insurance: At a Glance
| Age:
Up to 85 years |
Coverage Limits:
$50,000-$100,000 |
What We Think About Banner Life Insurance:
Banner life’s offers are indeed tempting. They may not have the best rider options but their rate and coverage limit makes them a desirable choice. |
| Policy Types:
Term & Universal life |
Medical Exam:
Conditional |
Banner Life Insurance: Profile
Banner Life Insurance Company was founded in 1949 and later acquired as a wholly-owned subsidiary of Legal & General Group PLC in 1981.
It operated under different names throughout the past century but officially became Banner Life under its 1981 acquisition.
In recent decades, Banner has become a highly recognized insurance provider, as has its subsidiary, William Penn Life Insurance Company of New York.
Legal & General is an offshore company headquartered in London. It has over 175 years of experience as an insurance provider and receives strong financial ratings for its strength and stability.
Banner Life gets an impressive A+ from A.M. Best and AA ratings from Standard & Poor’s and Fitch, all of which indicate strong stability in the insurance industry.
Overall, they provide financial management and protection through several insurance products and investment services.
Read this: How to Avoid or Overcome Life Insurance Fraud
Banner Life Policies
Like many life insurance companies, Banner Life offers two different types of insurance: term life and universal life.
Before selecting a policy, it is crucial to understand the differences between the two.
From monthly premiums to death benefits to conversion options, term life and universal life are very different types of policies.
Term Life Insurance: OPTerm
Term life insurance is a policy that pays benefits only for a specific time frame. Once that time frame, or term, ends, you will no longer be eligible to receive any benefits.
Here’s how it works:
Let’s say a person takes out a 20-year term policy. If they die within the 20-year period, their beneficiaries can collect their death benefit.
However, if they die 21 years after beginning the policy, their beneficiaries will receive nothing unless they pay an ever-increasing amount year after year.
The term life product from Banner Life is called OPTerm.
Under this plan, you can choose from term periods of 10, 15, 20, 25, 30, and 40 years.
Depending on the term you choose, policies can be issued between the ages of 20 and 75, with coverage expiration ending on your 95th birthday.
Universal Life Insurance: LifeStep UL
Banner’s universal life insurance policy is called LifeStep UL. The minimum coverage is $50,000, and Banner underwrites policies for individuals up to age 85.
Regardless of your age when you take out the policy, this plan guarantees to mature at the age of 121.
So unless you live past the age of 121, your beneficiaries will be able to collect your death benefit.
Universal life insurance also accumulates cash value. Here’s how Banner Life explains this:
“Premium payments, after deduction for an expense charge, are deposited to the policy account value.
The Company then makes monthly deductions from the account value to cover the monthly administrative and other expense charges and the cost for the amount of insurance coverage provided.
At the end of each month, the Company credits interest to the account value.”
This protects your coverage from lapsing, and the policy account value can also be borrowed against, while you’re alive, in the form of a loan.
Note: Banner does offer the option to convert a term policy to a universal life insurance policy, but there are some restrictions as to how that works.
If you take a term policy before you turn 66, you can convert it to a universal policy up until the end of the term or the age of 70, whichever comes first.
If you take out a term policy after age 66, you have a maximum of five years to convert the policy into a universal life policy.
Some insurance companies allow you to make conversions at any point throughout the term period. But Banner does not.
Term policies are always more affordable than permanent life insurance policies.
But when the term is up, the term is up, and you get nothing in return for all you’ve paid over the years in monthly premiums.
Final Expense Insurance
Banner Life also provides Final Expense Insurance. With guaranteed fixed rates and guaranteed acceptance, Final Expense Insurance is a great way to cover the cost of your funeral, burial, or other final expenses.
Coverage lasts your entire life, though premiums cease at age 95. If you have universal lifetime coverage, final expense insurance isn’t necessary.
But it is a good way to provide your family with some extra financial protection, especially if you can only afford to pay for a short-term policy.
Physicians Thrive offers free life insurance quotes to help you choose the best policy for your needs.
Factors that Affect Your Monthly Life Insurance Premiums
Banner Life Insurance Company, like all insurance providers, bases your monthly premium on a variety of different factors.
Here are some factors that will affect how much you might pay each month:
1. Coverage Amount
The more you want your heirs to receive upon your death, the more you can expect to pay in monthly premiums.
This is standard operating procedure for all insurance companies and all policies.
2. Term Limit
Term limits are another major determining factor in what your monthly premiums will cost. The longer the term, the higher your monthly premiums.
Term life insurance policies, however, are almost always less expensive than universal life policies. And this is for one simple reason:
If you are still living when the term ends, your policy ends and no benefits will be paid.
To collect on a term life policy, one would need to be dead within their term, whether that be 10, 20, 30, or 40 years.
3. Cash Value
Another reason why universal life policies are more expensive than term policies is that universal life policies accumulate cash value.
Every time you make a monthly payment, a portion of your premium becomes cash value. This value exists as a lump sum that you can withdraw from while you are still alive or use to pay for your premiums.
Your beneficiaries will only receive the death benefit; they will not receive any cash value on top of that.
So, it’s important to use the cash value while you are still alive, either in the form of a loan or as a way to pay down monthly premiums.
4. Health Conditions
Your current health, at the time you initiate your insurance policy, is a big factor in how much you’ll pay.
Ideally, insurance providers want to insure younger, healthier people with less risk of death.
For this reason, Banner Life requires that you have a medical exam before taking out a life insurance policy.
If you happen to be pregnant at the time of your medical exam, you may want to consider other insurance providers over Banner.
Banner tends to quote higher monthly premiums for pregnant women than most other insurers.
6. Age
Typically, the younger you are, the less you’ll pay. From the insurer’s point of view, it is far riskier to insure someone who’s 90 than someone who’s in their early 30s.
Banner does, however, provide term life policies for people up to the age of 85, whereas many other insurance providers cut off their issuance date at age 65 or 75.
7. Smoking Habits
Banner rewards clients for non-tobacco use. If you are a cigarette smoker, Banner will charge you a higher monthly premium.
If you quit smoking, they will adjust your rates down to a non-smoker’s rate level.
You’ll need to hold a policy for a minimum of one year to enjoy a reduced rate for quitting smoking.
This holds for marijuana usage as well. Even if you use marijuana under the prescription of a doctor, you will pay a higher monthly premium.
Is Banner Affordable?
In general, Banner Life Insurance is one of the more affordable options on the market. And if you’ve ever filed for bankruptcy, it may be one of your only options.
Unlike some insurance companies, Banner considers policyholders who have filed for bankruptcy and faced financial hardships in the past.
Most physicians, however, don’t fall into this camp and are better off considering other insurance providers who offer greater flexibility and more plan options.
Learn more about safeguarding your financial future. Read The Complete Guide to Physician Retirement Planning.
Optional Riders
Like most insurance providers, Banner Life allows you to add a series of riders to your policy to make your coverage even more comprehensive.
Here are the riders that you may want to consider adding to your term or universal policy.
Accelerated Death Benefit Rider
If you’re ever faced with a terminal illness while you’re still in your term, the accelerated death policy allows you to draw funds from the policy as a lien against it.
With this rider, you can withdraw up to 75% of your policy, up to a maximum of $500,000.
Children’s Rider
In certain states, you can add the Children’s Rider, or Child Protection Rider, to your plan.
With this rider, each of your children will receive an added death protection benefit of up to $10,000 as long as they’re under the age of 25.
Waiver of Premium Benefit
If you suffer a long-term disability for more than six months, Banner will waive your monthly premiums if you have the Waiver of Premium benefit as a policy rider.
Keep in mind that all of these riders will be added to your monthly premium. The more you add, the more your monthly premium will be.
Does your disability policy have riders? Read Disability Riders that Increase Benefits Over Time.
Banner Life: Pros and Cons
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Frequently Asked Questions
What Do Your Beneficiaries Need to Do to Collect Benefits?
With a Banner Life policy, your beneficiaries can expect to provide a death certificate, a copy of the original policy, and a claims statement to initiate the payout process.
Where Can I Get Banner Life Insurance?
Banner provides term life insurance coverage in up to 49 states.
Do Banner Life Insurance Policies Pay Dividends?
Banner Life doesn’t pay dividends to policyholders because they don’t operate as a mutual company.
Only mutual companies can pay dividends to policyholders.
Is Banner Life Insurance a Good Option for Physicians?
Banner Life offers affordable rates compared to other providers, which makes it an attractive option for many individuals.
If you’re looking for a simple, straightforward term life plan, Banner is a reasonable choice.
But if you want an extensive policy or have more complex needs, other insurance providers are better options.
Other Life Insurance Providers
| Allianz | AMA Life Insurance | Genworth | John Hancock | |
| Term | Up to 60 years | Up to 45 years | Up to 30 years | Up to 30 years |
| Policy Types | Whole life, term life, long term care | Level term life, pure term life, preferred term life. | Term life and permanent life insurance. | Term Life, Universal Life, Variable Life, Survivorship Life |
| Standard and Poor’s Rating | AA | AA+ | A+ | A+ |
Why Trust Physicians Thrive
At Physicians Thrive, we review some of the best insurance providers for physicians in the industry to meet a variety of needs.
If you’re in the market for a life insurance policy, contact Physicians Thrive now.
Our experts are available to answer all of your questions and guide you toward creating the best financial situation for your family now and in the future.
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Allianz | AMA Life Insurance | Genworth | John Hancock | Kansas City Life | Mutual Life | Nationwide | Pacific Life | Principal Life
