Owning a life insurance policy is an excellent tool in preventing the financial impact that your death could have on the family’s finances.
Life insurance pays a death benefit to your beneficiary when you pass away. The death benefit of a life insurance policy can assure that your family’s standard of living is not financially interrupted with your passing.
While it’s evident that life insurance can provide financial protection after you pass, could life insurance also do the same while you’re alive?
The answer is yes, there is life insurance that you can use while you’re alive, and as more people find out about this type of coverage, it’s becoming an increasingly popular life insurance option.
Transamerica offers its popular term life insurance coverage called Trendsetter LB (Living Benefits). It provides financial protection against death and financial protection against a serious illness such as a heart attack, cancer, or stroke.
Suppose you’ve been looking for an affordable term life insurance policy that can offer some exciting policy features. In that case, we will help you learn about everything you need to know about Transamerica and its Trendsetter Living Benefits coverage in our full review.
Transamerica Life Insurance Company
Founded back in 1904, Transamerica is one of the 10 largest life insurance companies in the United States.
The insurance giant provides life insurance coverage in all 50 US states and is headquartered in Cedar Rapids, IA.
The insurance company offers several different life insurance products such as two different term life insurance options, indexed universal life, whole life insurance. In addition to multiple life insurance products, Transamerica has an entire branch dedicated to retirement-planning products.
Transamerica Life Insurance Ratings
Whenever you are considering buying a product, especially one that you depend on to help provide financial support to your family after you’re are gone, you will want to make sure to view their ratings.
Transamerica has scored well with several top-tier professional rating agencies that should provide peace of mind in purchasing a life insurance plan from the insurance company.
As of October 8, 2020, AM Best Rating agency has awarded Transamerica Life Insurance Company with its A rating suggesting they have a strong financial outlook. The ranking is the 3rd highest-ranking out of 16 categories.
October 7, 2020, Moody’s rated the insurance company with its rating of A1, making it the 5th highest rating out of 21 possible ratings.
February 21, 2020, S&P provided a rating of A+, making it the 5th highest rating out of 21 possible ratings.
According to the J.D. Power 2019 Life Insurance Study, Transamerica ranked #20 out of 24 individual life insurance companies. The study included considerations of coverage options, pricing, communications, and more.
On the Better Business Bureau (a nonprofit organization focused on marketplace trust and product quality), Transamerica has an A+ rating.
Transamerica Living Benefits Term Life Insurance
Transamerica offers two term life insurance options: Trendsetter Super (death benefit protection) and Trendsetter LB (death benefit protection with living benefits).
The Trendsetter LB plan is the insurance company’s popular term life insurance with living benefit options. You can receive death benefit protection up to $2 million along with the option to access your death benefit for cash benefit payment if faced with a qualifying chronic, critical, or terminal illness that is built into the term insurance plan at no additional costs.
Transamerica Trendsetter LB provides the following benefit:
- Competitive term insurance rates
- Term contract options of 10, 15, 20, 25, or 30 years
- Coverage amounts as high as $2,000,000
- No medical exam option for applicants ages 18-60
- Option to convert to permanent coverage after the contract expires
- Acceleration of death benefit proceeds for qualifying chronic, critical, or terminal illness
Transamerica Living Benefits LB Overview
| Term Lengths: |
|---|
| Guaranteed Level Premium Term (10, 15, 20, 25 and 30 years) |
| Death Benefit Amounts: |
| Minimum Face Amount: $25,000 Maximum Face Amount: $2,000,000 |
| Issue Ages: |
| 10-Year: 18-60 ($25,000-$99,999) 10-Year: 18-80 ($100,000-$2,000,000) |
| 15-Year: 18-60 ($25,000-$99,999) 15-Year: 18-75 ($100,000-$2,000,000) 18-73 Tobacco |
| 20-Year: 18-60 ($25,000-$99,999) 20-Year: 18-70 ($100,000-$2,000,000) 18-65 Tobacco |
| 25-Year: 18-60 ($25,000-$99,999) 18-49 Tobacco 25-Year: 18-63 ($100,000-$249,999) 18-57 Tobacco 25-Year: 18-65 ($250,00-$2,000,000) 18-60 Tobacco |
| 30-Year: 18-50 ($25,000-$99,999) 18-40 Tobacco 30-Year: 18-57 ($100,000-$249,999) 18-46 Tobacco 30-Year: 18-58 ($250,00-$2,000,000) 18-53 Tobacco |
| Non-Medical Exam Option: |
| $25,000 to $249,999 (Ages 18-60) |
| Policy Riders: |
| Accidental Death Benefit Rider Children's Benefit Rider Living Benefit Riders (Chronic, Critical & Terminal Illness) Monthly Disability Income Rider Disability Waiver of Premium Rider |
| Conversion Option: |
| Convertible to age 70 (Age 75 if approved preferred plus) |
What makes Transamerica Living Benefits unique?
Term life insurance is the least complicated form of life insurance. You choose a term length and a death benefit amount that meets your financial obligations. If approved, all that’s required from you is your premium payments whenever they are due.
In return, the life insurance policy provides a death benefit that is payable to the policyholder’s beneficiary should the insured pass away during the term contract duration.
The Trendsetter LB plan not only provides the death benefit if the policyholder dies during the duration of the term contract, but it also offers expanded living benefits.
Transamerica is one of the first life insurance companies, a traditional term life insurance policy with three living benefit features built directly into the insurance coverage at no additional costs.
Having these riders can allow for the death benefit to be used while you’re alive if you become critically or chronically ill and cannot work. It is truly a life insurance policy that protects against financial hardship due to serious medical illness.
How do Transamerica's living benefits work?
Transamerica Living Benefits provides financial protection in two completely different ways.
First and foremost, this is a life insurance plan that offers financial protection in the form of a death benefit that is payable to your beneficiary after your passing. The funds received from a death benefit can be used to help your loved ones maintain their current standard of living without having to worry about exhausting their savings.
The second way that the life insurance policy provides financial protection is through the living benefits features offered within the coverage at no additional cost. If you become ill with a qualifying chronic, critical or terminal illness, you can request early access to your death benefit to help you financially.
Accessing your death benefit due to a living benefits claim will require one of the following medical conditions to occur before a claim request can be granted.
Chronic Illness: A qualifying chronic illness would require you not to be able to perform two of the six Activities of Daily Living (bathing, continence, dressing, eating, toileting, and transferring) without assistance, or you’re severely cognitively impaired for a period of at least 90 days.
Critical Illness: A qualifying critical illness would require you to be diagnosed with a health condition such as a heart attack, stroke, cancer, end-stage renal failure, ALS, a major organ transplant, blindness, or paralysis resulting from specific underlying conditions.
Terminal Illness: A qualifying terminal illness would require you to be diagnosed by a licensed medical professional to be having a life expectancy of 12 months or less to live.
How much living benefit money can you receive?
The maximum amount of money that may be accelerated from the death benefit due to a qualifying chronic or critical illness is up to 90% of the full death benefit amount. The terminal illness benefit allows for 100% of the death benefit to be accelerated.
It is important to understand that although there is a maximum benefit amount of 90% that can be accelerated from the death benefit due to a qualifying chronic or critical illness, it doesn’t mean that will be the amount of money you will receive.
When you submit a claim to request acceleration of the death benefit for a cash payment, the insurance company will evaluate your claim to determine a percentage they will payout which can be up to 90% of the death benefit.
There are a couple of factors the insurance company will look at to determine a payout percentage which includes the type of illness and your expected life expectancy as a result of the illness.
If your life expectancy is not likely to be greatly affected by the illness, a payout could range from 10-30% of the death benefit. If your life expectancy is expected to moderately be affected, your payout could be 30-60%. A medical condition that would likely shorten your life expectancy significantly would result in a higher payout that could be 60-90%.
When determining a potential percentage payout, the insurance company will also consider how much time and premium payments are left until your coverage is up to expire.
Chronic Illness: The maximum amount that can be accelerated in any 12 month period is 24% (annually) up to a total of 90% of the death benefit.
Critical Illness: The maximum amount that can be accelerated at any given time is 90% of the death benefit payable in one lump sum payment.
Terminal Illness: The maximum amount that can be accelerated at any given time is 100% of the death benefit payable in one lump sum payment.
Who is eligible to apply for coverage?
Transamerica Living Benefits term life insurance is available to applicants between the ages of 18 and 80. Both non-tobacco and tobacco users are also eligible to apply.
Trendsetter LB is not available to residents of New York.
What are the minimum and maximum coverage amounts?
Coverage amounts range from as low as $25,000 up to as high as $2 million in coverage. As with any life insurance policy, premiums will become more expensive the higher the amount of coverage being applied for is.
What are the available term contract lengths?
Transamerica Trendsetter LB comes in 10, 15, 20, 25, and 30-year contract durations. Your premium is guaranteed to remain the same price throughout the entire contract length your choose.
- Trendsetter LB 10 = 10 years of fixed premiums
- Trendsetter LB 15 = 15 years of fixed premiums
- Trendsetter LB 20 = 20 years of fixed premiums
- Trendsetter LB 25 = 25 years of fixed premiums
- Trendsetter LB 30 = 30 years of fixed premiums
The range of available term contract lengths is on par with industry standards and will be suitable for most people seeking life insurance.
They have a good variety of contract lengths in 5-year increments, making it easy to purchase the amount of coverage you need without paying for coverage any longer than you need.
Are there any available policy riders?
Transamerica offers the following policy riders:
Accident Indemnity Rider: This rider pays an additional death benefit if the insured’s death results from an accidental bodily injury. For the additional death benefit to be paid, a death caused by accident must occur within 180 days from the accident and before age 70 of the insured.
This rider is available at an additional cost.
Child Protection Rider: Adds death benefit protection for all insured children under the adults term life insurance policy. Coverage is offered in units, with each unit equivalent to $1000 of death benefit coverage. The child rider offers 1-99 units of coverage.
Children ages 15 days to 18 years old are eligible, and coverage expires when the child turns age 25 or when the adult’s insurance policy terminates. The child term insurance coverage is also convertible to their own permanent life insurance plan.
This rider is available at an additional cost.
Living Benefit Coverage: The main feature of the life insurance coverage that allows an acceleration of the death benefit when diagnosed with a qualifying terminal medical condition, chronic illness, or critical condition.
Included at no additional cost.
Monthly Disability Income Rider: A rare policy rider offered exclusively on the Trendsetter Living Benefits term insurance policy is the option to add a monthly disability income rider. The MDI rider provides a monthly income for up to 24 months (2 years) if the insured is totally disabled and qualifies.
Total disability means the insured’s inability to perform the substantial and material duties of their regular occupation for which the rider insured is reasonably suited by education, training, or experience.
The monthly income that can be received from the rider is your choice of a $300-$2000 monthly benefit or 2% of the initial death benefit and cannot exceed 66% of the insured’s gross monthly income. This rider, combined with the living benefit riders ready included in the life insurance, makes the life insurance coverage one of the strongest living benefits life insurance plans on the market.
This rider is available at an additional cost.
Waiver of Premium Rider: This rider waives premiums if you become disabled. After a six month waiting period of consecutive uninterrupted disability, the insurance company will waive premium payments retroactively from the beginning of the disability. Premiums will remain being waived until the insured reaches the age of 65.
This rider is available at an additional cost.
Conversion option
Trendsetter LB is convertible to one of Transamerica’s permanent life insurance plans as long as it is requested no later than the earlier of the end of the initial level premium period of the insured’s 70th birthday (75th if your plan was approved as preferred plus risk classification).
Income Protection Option - IPO
Transamerica Living Benefits offers a unique optional policy benefit that allows you to structure how your death benefit will be paid to your beneficiary. Normally a death benefit is paid in one lump sum payment once your beneficiary has submitted a death claim.
With the Transamerica Income Protection Option or IPO for short, you can choose to have the insurance company make payments to the beneficiary in installments rather than them paying it in one single payment. This option is what is known as a Fixed Settlement Endorsement and is not offered by every company.
If you choose to structure your death benefit payout, you can select from a few different payout options that include the following:
- An initial lump sum paid at the insured’s death
- Monthly payments paid out for a specified amount and for a specified period of time
- A final lump sum payment after a period of monthly payments
Structuring your death benefit payout can be a good option if you’re worried about your beneficiary having issues with money management after your passing. It does not cost any extra to add this benefit option, but it has to be elected at the time you are applying for coverage.
Transamerica Living Benefits LB Frequently Asked Questions
Transamerica Living Benefits is a popular term life insurance option, and because it’s a little different than the traditional term insurance plans, you are likely to have some questions.
Our job is to help you with those questions, so we have put together a large list of some of the most frequently asked questions about Transamerica’s life insurance coverage.
How do you apply for coverage?
Applying for a Trendsetter LB term life insurance policy can be done either through a paper application or electronically online.
Through our online quote calculator, you can view coverage rates and even complete a step-by-step online application with an e-signature process. This will eliminate the need for you having to print any paper forms as everything can be entirely complete online.
A quick recommendation, since this term insurance plan focuses on providing both living benefits and death benefit protection when choosing an amount of coverage, be sure to also factor in potential expenses caused by any unforeseen medical condition in addition to money your loved ones would need after your passing.
For example, you might have a health insurance plan, but how much would your plan pick up the total costs from an illness? What non-medical expenses would occur?
Here is a list of factors you should consider when choosing a death benefit amount:
- Unexpected costs
- Loss of income
- Hospital bills
- Medical treatments
- Child care
- Education
- Loans
- Transportation
- Clothing
- Housing
- Food
Choosing a death benefit is a process that takes careful planning. If you need assistance, be sure to reach out for some guidance.
What information is used to determine eligibility?
Trendsetter LB is a fully underwritten term life insurance plan. Your application will be submitted to an underwriter and reviewed to determine your eligibility and final price for coverage.
Underwriting will use the same underwriting standards used by most life insurance companies to determine eligibility and assignment of a final health risk classification of Preferred Plus, Preferred, Standard Plus, or Standard.
The following information to determine your eligibility and final health risk classification:
- Application – Personal information
- Medical Exam – Health questions, labs, blood pressure, height, and weight
- Attending Physicians Statement (APS) – only if needed
- Motor Vehicle Report (MVR) – Provides insight on your driving history
- Prescription Records (Rx) – Notifies underwriting of any prescribed medication and dates of refills
If you have a history of health conditions it should not discourage you from applying but there are some medical conditions that are automatically not eligible for living benefit coverage. A few of these risks include:
- Alcohol abuse or any drug use within three years
- Cancer (other than non-melanoma skin cancer)
- Coronary artery disease
- Diabetes with insulin use
- Inability to perform Activities of Daily Living (ADL’s)
- Motor neuron disease
- Multiple sclerosis
- Muscular dystrophy
- Parkinson’s disease
- Pregnancy – current through three months postpartum
- Stroke or TIA
- Systemic lupus erythematosus
If you have a health condition history and are unsure if you would qualify for a Transamerica Trendsetter LB policy, be sure to contact us. We will put you in touch with our internal underwriting department to determine the potential of your eligibility.
Will a medical exam be required?
Most Transamerica Living Benefits term life policies will require a medical exam. However, those between the ages of 18-60 may be able to get a policy without a medical exam. However, we are not sure it will be in everyone’s best interest, and we will explain why.
The option to skip the medical exam with Trendsetter LB comes at a cost. This is because the non-medical exam option is only available for coverage amounts of $25,000 through $249,999.
If you elect to skip the medical exam, the best health risk classification will automatically be standard rates. If you are in excellent health and choose to pass on the medical exam option, you could be passing on a potential preferred approval, which would have been a cheaper premium than a standard approval.
How quickly can you be approved for coverage?
In the modern life insurance industry landscape, technology has led the way for coverage to be approved quickly. For many companies, the turnaround time can be made within 24-72 hours of applying.
However, Transamerica Living Benefits coverage approval times lag far behind industry standards. While the application is fairly short, the approval times can take 1-2 weeks at best.
Is Transamerica Living Benefits term life insurance affordable?
The cost of your life insurance policy with Transamerica will fluctuate based on the contract length, death benefit added policy riders, and your final health risk classification.
Compared to their competitors, Transamerica’s Living Benefits term insurance plan is priced on the higher end. Keep in mind that most of their competitors do not offer the same living benefit features as Transamerica has built into their term insurance plan.
If you want these same features, you will likely need to pay extra in the form of a rider and that if you can find a company that can offer all three living benefit options.
$500,000 Transamerica LB Term Life Insurance Sample Rates
| Male | Trendsetter LB 10 | Trendsetter LB 20 | Trendsetter LB 30 |
|---|---|---|---|
| Age 30 | $14.62 | $24.94 | $36.12 |
| Age 35 | $16.77 | $33.11 | $49.02 |
| Age 40 | $25.37 | $47.30 | $73.10 |
| Age 45 | $36.12 | $69.23 | $111.80 |
| Age 50 | $57.19 | $104.92 | $183.61 |
| Age 55 | $98.47 | $163.83 | $313.04 |
| Age 60 | $159.53 | $266.60 | NA |
| Age 65 | $279.07 | $486.33 | NA |
| Age 70 | $477.30 | $924.07 | NA |
| Age 75 | $783.03 | NA | NA |
| Age 80 | $1,828.36 | NA | NA |
| Female | Trendsetter LB 10 | Trendsetter LB 20 | Trendsetter LB 30 |
| Age 30 | $12.90 | $20.64 | $30.10 |
| Age 35 | $14.62 | $27.52 | $41.28 |
| Age 40 | $21.50 | $38.70 | $60.20 |
| Age 45 | $28.81 | $53.75 | $90.73 |
| Age 50 | $45.15 | $80.41 | $150.07 |
| Age 55 | $71.81 | $127.71 | $266.17 |
| Age 60 | $124.27 | $215.00 | NA |
| Age 65 | $220.59 | $394.74 | NA |
| Age 70 | $376.68 | $766.69 | NA |
| Age 75 | $621.35 | NA | NA |
| Age 80 | $1,508.01 | NA | NA |
*Preferred Plus Non-Nicotine underwriting classification. Monthly Male/Female premium rates current as of 01/23/2021 representing the cost of a $500,000 Trendsetter LB term life insurance policy.
What if you don't want to use your living benefits?
If you experience a medical illness that would otherwise qualify for an acceleration of your death benefit, you are not required to do so. It is completely your choice as to whether or not you elect to file a claim for a potential cash payout.
You are also not required to accept a payment after the insurance company has evaluated your claim and has determined the percentage they are allowing for a payout. Benefit amounts may also be reduced to a lower amount if you would prefer to leave more death benefit to your beneficiary.
Because the maximum benefit payout for chronic and critical illness is 90%, there will always be a 10% death benefit that will be available to your beneficiary.
What happens when coverage ends?
Once your level premium period ends you have the option to allow the coverage to lapse and terminate if you no longer need life insurance protection.
Trendsetter LB is renewable to age 105 but it will be at an increasing annual cost that can become very expensive.
You may also choose to purchase a new term policy for the time you will need coverage for, but keep in mind the premiums will likely be higher since you are applying at an older age. If you had any new conditions arise, that may also affect your rates and ability to qualify.
Another option you have is to convert your policy to a whole life policy. You can do this anytime before your 70th birthday or the end of the term, whichever is first. Any policyholders that were approved at the preferred plus health risk classification will have until the end of the term or their 75th birthday.
Pros & Cons of Transamerica Living Benefits (LB) Term Life Insurance
There is a lot to like about Transamerica and its Trendsetter Living Benefits term life insurance coverage but with most great things, there are some cons.
Here we will list everything we like and dislike in a list of pros and cons about the life insurance coverage.
Transamerica Living Benefits Pros
- Your life insurance coverage is issued and backed by a well established and highly rated life insurance company.
- Three built-in policy riders (chronic, critical, and terminal illness) provide financial protection against unexpected illnesses.
- You don’t have to be in excellent health for a non-medical exam underwriting.
- Optional policy riders including the rare monthly disability income rider (MDI).
- Unique Income Protection Option used to structure death benefit payout.
- Convertible to permanent life insurance up to age 70/75.
- Priced fairly against competitors that cannot offer similar coverage.
Transamerica Living Benefits Cons
- Slower approval process than the industry average.
- Terrible non-medical option for healthy applicants.
How to get a Transamerica Living Benefits Term Life Insurance Quote
Ready to start comparing some Transamerica Living Benefit quotes?
No Medical Exam Quotes is partnered with Transamerica Life Insurance along with two dozen of the top-rated life insurance providers to help you shop for the best life insurance for you and your family.
Visit our online quote tool, where you can instantly compare Transamerica Living Benefit quotes. If you find a plan that you like, you will be able to complete an application online, all from the comfort of your home.
And of course, if you need assistance, please be sure to reach out to us.
