Equitable Life Insurance ranks as one of our best life insurance companies because its underwriting caters to certain niche applicants. And since we will sometimes recommend the company to our clients, we have put together this comprehensive Equitable review covering all things about the company.
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About Equitable Life Insurance
Previously known as AXA Equitable Life Insurance Company, New York-headquartered Equitable Life Insurance Company of America, a subsidiary of Equitable Holdings, LLC, began its existence over 150 years ago.
Since the early 1990’s Equitable Life has been owned by AXA, a huge insurance group that is based in France and does business in dozens of countries throughout the world.
Though Equitable was formerly a mutual company, it became a stock company around the time of the AXA acquisition and started trading on the NYSE in 2018, under the symbol EQH.
Equitable Life policies are issued throughout the U.S. under the Equitable America or AXA Equitable brands, except in New York Equitable policies are issued by “Equitable Financial Life Insurance Company.”
Equitable’s insurance and annuity products are primarily marketed by the nearly 5,000 agents and financial advisers who form the company’s distribution network.
Along with individual and group life insurance, Equitable also markets annuities, financial and retirement planning services, and employee benefit administration.
On its website, Equitable states that, during WWII, the company waived policy exclusions for deaths resulting from armed conflict between states. As a consequence, Equitable paid out on thousands of policies that might have otherwise not received a benefit. That’s an interesting piece of trivia that Equitable has a right to take pride in, even if it is now dominated by Frenchmen <grin>.
Equitable Financial Ratings
A.M. Best: A+
S&P Global: A+
Comdex Ranking: 82
Equitable’s financial ratings are solid with all of the major ratings services. The company is backed by significant worldwide wealth, with greater than $700 billion in assets under management for its parent company Equitable Holdings. Thus, policyholders face little risk that Equitable will be financially unable to meet its policy obligations in the foreseeable future.
Equitable has been accredited by the Better Business Bureau for 80 years and scores an A+ rating from BBB. Though consumer reviews for the company are limited, it seems to be a fairly well-thought-of operation.
Accumulation Streamlined UW Program
With the COVID-19 Pandemic still underway, many people are looking for life insurance with no medical exam.
Equitable’s Accumulation Streamlined UW Program is available in all states for applicants up to age 55 for face amounts up to $2,000,000.
The Program is accelerated underwriting, which means the company still does a thorough underwriting, looking at prescription databases, MVR, MIB, and other data resources. However, no face to face meetings, fluids or blood draw are required.
Life Insurance Underwriting Niches
One potential drawback of Equitable is it often fails to offer the best life insurance rates. However, if you fall into one of its niche categories, it may turn out to be the best option because you will secure a better health rating than with a different company.
One area where Equitable’s underwriting excels is with total cholesterol. The company is one of a handful of insurers who will offer a preferred plus rate class to an applicant that has cholesterol levels up to 300.
Another area where the company differentiates itself is build, allowing a larger Body Mass Index (BMI) than most other carriers.
Products Offered by Equitable Life Insurance:
- Term Life Insurance
- Indexed Universal Life Insurance
- Variable Life Insurance
- Group Term Life
- Retirement Planning
Life Insurance Policies Offered by Equitable
Equitable offers three basic options in term coverage: Level-Term, ART, and a single-premium, one-year policy.
Level term life insurance policies come with initial terms of 10 (“Term 10”), 15 (“Term 15”), or 20 years (“Term 20”). Premiums are fixed through the duration of a policy’s term.
Equitable’s ART (“annual renewable term”) policy provides for annual renewal of one-year terms. Subject to a maximum amount, premiums increase at each renewal, except that the first three years’ rates are guaranteed.
A final term option, TermOne, is a one-year, non-renewable term policy payable with a single premium. The policy can’t be renewed, isn’t eligible for any riders, and has only one “standard” underwriting class.
Equitable’s term policies include a built-in conversion option letting policyholders convert term coverage into an Equitable Life permanent policy. The option can be exercised until the insured turns 70 or the policy’s initial term ends, whichever happens first. ART policies can be converted anytime while the policy remains effective until the insured reaches 70.
Final Expense (whole life): Equitable is not currently offering a guaranteed-acceptance final expense policy.
Universal Life Insurance
Equitable has four different policy options built around the UL structure, two of which are indexed and two of which are variable. The UL policies accumulate cash value, with premium payments split between underwriting costs and the investment component.
The amount of premium paid is flexible, subject to required minimums necessary to keep the coverage in place. Once it grows sufficiently, cash value can be applied toward premiums.
Equitable Life’s indexed policies base policy growth on performance of the S&P 500 Index. Growth is subject to a cap (10% in Equitable’s examples). Policy growth can’t exceed the cap amount over the relevant period, even if the index earns higher returns. Policies also have a 0% loss floor. So if the market drops, the policy won’t grow, but it also won’t lose value.
IUL Protect is an indexed universal life policy that emphasizes the death benefit and is designed to provide for guaranteed coverage through age 90 (or for 40 years) with relatively lower premiums.
The policyholder gets to choose the allocation of cash-value funds between an indexed account and an account that grows at a fixed, guaranteed rates (at least 2.5%). A policy’s death benefit can be either the policy’s face value or face value plus cash value, at the policyholder’s election.
BrightLife Grow is also an IUL policy but is geared more toward cash-value growth. It still provides a death benefit but assigns a higher percentage of premium payments to cash value.
Along with the S&P, cash value can also be assigned to a small-cap index, an international index, or a fixed-growth account. An optional rider reduces the surrender charge that normally apply during the first eight years, allowing earlier access to policy funds, and can provide for a refund of certain policy fees.
Variable Universal Life
Equitable’s two variable universal life options are VUL Optimizer and VUL Legacy.
Like most VUL policies, both have a flexible structure and higher fees than other types of life insurance. Rather than linking growth to an equity index, policyholders can choose among multiple investment portfolios offered by Equitable.
VUL Policy growth depends on performance of the investments picked by the policyholder, with an optional Market Stabilizer Option allowing for an indexed growth account that’s protected against losses of up to 25%.
The main difference between Optimizer and Legacy is in the emphasis on cash-value accrual versus death benefit. Optimizer focuses on growth and the investment component. Legacy is designed more to provide permanent coverage with lower required premiums.
A paid-up death benefit option is built in—allowing a policy to stay in place indefinitely with a lower death benefit and no future premiums—and an optional no-lapse guaranty is also available.
Available Life Insurance Riders
Living Benefits Rider: This rider allows acceleration of a portion of a policy’s death benefit if the insured is diagnosed with less than 12 months to live.
Children’s Term Insurance Rider: The Children’s Rider provides term coverage for all of the insured’s dependent children and can be converted to permanent coverage.
Disability Waiver of Monthly Deductions Rider: If the insured becomes disabled for at least six months prior to reaching age 60, the premium obligations are waived while the insured remains disabled. If disability occurs after age 60, the waiver is effective through age 65.
Option to Purchase Additional Insurance Rider: This rider provides the right to purchase additional coverage on the insured in a specified amount and at specified dates without any further underwriting.
Long-Term Care Services Rider: The long-term care rider allows acceleration of policy benefits to cover qualifying long-term care expenses.
Charitable Legacy Rider: If the rider is purchased, the policy pays out a supplemental death benefit to up to two charities of the policyholder’s choice.