At IBUSA, we work with many of the top final expense insurance companies. And, although Great Western is not one of the companies we currently represent, we thought we would provide a comprehensive review for anyone shopping around for the best policy.
Before we do, we would like to make it perfectly clear that just because we currently don’t offer Great Western products, this doesn’t mean that they aren’t a quality life insurance company. It just means that as of right now we do not have a working relationship with them which might change in the future (who knows). It also doesn’t mean that we wouldn’t like to have a working relationship with them either.
We want to make this…
Perfectly clear, because at the end of the day, we here having nothing but respect for Great Western Insurance company and the work that they are doing to help families find the coverage that they need.
Now with that out of the way…
Let’s actually discuss Great Western and the products that they cover because in our experience here at IBUSA, what we have found to be true is that the most popular product offered by Great Western is the company’s guaranteed issue life insurance. These “types” of life insurance policies offer an applicant to be able to qualify for coverage irregardless to any prior or current health issues. And while these types of life insurance policies may only provide a limited amount of coverage, as a whole they do provide an invaluable option for may who simply can’t qualify for a traditional term or whole life insurance policy.
We’ve got to say, that in our opinion here at IBUSA, choosing to try and help those who can’t find help elsewhere really is what each and every life insurance company should be in the business of doing. Sadly this isn’t always the case, however when it comes to Great Western, it does seem to be one of their driving purposes.
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About Great Western Insurance Company
Founded in 1983 by the owner of a funeral and mortuary company, Great Western Insurance Company (“Great Western”) is a Utah-based insurer specializing in end-of-life coverage.
The company’s founder saw a market for relatively low-coverage whole life insurance policies intended to aid surviving family members and estates in covering end-of-life expenses.
Funeral and burial costs can be a lot more expensive than many people realize, so Great Western aims to alleviate some of those costs.
For the most part, Great Western only sells final expense policies and pre-need funeral insurance, both of which are marketed to older applicants. The hyper-specialization can be a good or bad thing, depending on your needs.
If your sole goal in purchasing life insurance is to provide a means of paying for final expenses, Great Western can provide access to coverage for individuals who might not be able to qualify otherwise.
However, if you are otherwise in decent health, you may be able to find a superior policy elsewhere.
American Enterprise Group
Though Great Western remained a small, independent insurer through much of its existence, the company was acquired by American Enterprise Group in 2018.
While the acquisition did increase some of the financial weight behind Great Western, American Enterprise Group is itself relatively small compared to many of the massive organizations that dominate most of the life insurance industry.
However, considering that Great Western is writing mostly low-dollar policies, the relative size of the group is less of a concern.
Great Western sells life insurance in 46 states and Washington, D.C. Policies are marketed through independent agents throughout Great Western’s service area.
Great Western Financial Ratings
A.M. Best: A-
S&P Global: NR
Comdex Ranking: NR
Great Western’s acquisition by American Enterprise helped the company bump up its A.M. Best rating to A- from its previous B++. Because many advisers recommend against purchasing coverage from carriers below the A- threshold, that was an important step forward for Great Western. On the other hand, some advisers recommend a minimum “A” rating, leaving out even A- carriers.
Unfortunately, Great Western doesn’t make nearly as much of its financial information available on its website compared to most other insurers. So, it’s difficult to get a very definite picture of how Great Western stacks up financially against other players in the field of final expense insurance.
The American Enterprise Group reports around $2.5 billion in assets. And, on its website, Great Western asserts that its “Surplus to Liability Ratio is among the highest in the industry,” with a better ratio than the average of the country’s 25 largest life insurers. Great Western cites a study from 2013 in support of its claim. Source.
Great Western Consumer Ratings
Great Western is not accredited by the Better Business Bureau and currently has an A-rating from the BBB. Though the sample size is small, the customer reviews of Great Western available on BBB’s site are not particularly good—averaging only 1.8 out of 5 stars.
Reviews on other sites are a little more promising, though slow claims handling appears to be a common issue.
Great Western’s website isn’t set up to allow policyholders to do much more than make payments. So, individual customer service experiences could depend a lot on how attentive a local agent is and which company representative you happen to get on the phone that day.
What Products Does Great Western Offer?
Great Western is a very specialized company—focusing on final expense coverage and pre-need funeral insurance, both of which serve a similar market.
In either case, the products are marketed to seniors who want a guaranteed source of funding for end-of-life expenses.
Burial insurance policies are its primary focus, and larger policies designed for income replacement, cash-value accumulation, or tax-advantaged estate-planning strategies are not what Great Western does.
Group annuities—which pay fixed interest rates for purposes of funding qualified and non-qualified benefit plans—round out Great Western’s offerings.
Life Insurance Policies Offered by Great Western
Great Western offers two whole life final-expense policies: a simplified-issue policy called “Assurance Plus” and a guaranteed-acceptance policy called “Guaranteed Assurance.”
- Both policies are available for ages 40-80
- Face amounts from $1,000-$40,000 are available
As whole life coverage, Great Western’s final expense policies have fixed premiums and death benefits guaranteed for life (as long as all premiums are paid). Policies accrue cash value that increases over time and can be tapped through policy loans or by surrendering a policy.
Although these features are included, Great Western’s final expense policies are designed for policyholders who intend to keep the coverage in place to cover end-of-life expenses.
Assurance Plus Final Expense Insurance
Assurance Plus is Great Western’s simplified issue policy. That means no health exam is required during the application process, but applicants can be denied coverage based on how they answer health-related questions in the application.
Great Western’s “knock-out questions” are less stringent than with many other simplified issue policies. They’re basically looking for fairly serious conditions like lung, heart, and liver disease, cancer, HIV, and diabetes.
Here is a sample of the health questions asked.
Since the application for both Assurance Plus and Guaranteed Assurance are the same, Great Western tells potential applicants that, if they qualify for Assurance Plus, the death benefit will be increased to 120%. So, if you apply for a $10,000 Assurance Plus policy, you’re actually buying $12,000 worth of insurance.
Presumably, this is supposed to account for the lesser risk involved with Assurance Plus compared to Great Western’s guaranteed-issue policy. But it seems like it unnecessarily confuses the application process.
Accelerated Death Benefit
Assurance Plus policies include a standard accelerated death benefit rider (ADB rider) on all level premium policies. An ADB rider allows a policyholder to access the policy’s death benefit early if the insured is diagnosed with a chronic or critical illness.
And a Dependent Child and Grandchild rider is available for an additional $1 per month. The latter rider provides a $2,500 death benefit covering the insured’s dependent children and grandchildren.
A spousal bonus rider is also available on both policies. This rider pays an additional $1,000 on the death of the first spouse if both spouses apply at the same time.
Guaranteed Assurance Final Expense Insurance
Great Western’s Guaranteed Assurance final expense policy provides relatively low-coverage whole life insurance with essentially no underwriting.
If you’re in the right age bracket, you can get coverage regardless of your health condition.
That can be great for hard-to-insure applicants who are looking for life insurance with no health questions, but, of course, it comes with some downsides.
First, guaranteed-issue policies have higher premiums. The insurance company has less information about the risk it’s undertaking, so it assumes the insured is high-risk. Thus, if you can qualify for the simplified-issue policy, you’ll almost certainly get better rates.
Second, guaranteed-issue policies inevitably include a graded death benefit, which is essentially a “waiting period.” And Guaranteed Assurance from Great Western is no exception.
In this case, the waiting period is two years. That means that, if the insured dies during the initial two-year period after a policy is issued, Great Western won’t pay out the policy’s entire face value.
Instead, the death benefit payout will be equal to the total premiums paid to date, plus 10%.
However, if death results from a qualifying “accident” (even during the initial two years), the full death benefit will be paid out. After two years, full coverage kicks in regardless of how death occurs.
Preneed Funeral Insurance
Preneed funeral insurance serves a function similar to final expense coverage but with an important distinction. Where a final expense policy is payable to a named beneficiary and the proceeds can be used for most anything, preneed funeral policies are payable to a preselected funeral home.
In most cases, a preneed policy is purchased through the payee funeral home itself. Typically, the applicant and funeral home decide on arrangements and price, and the policy is set up so that the applicant’s desired arrangements are accounted for.
This can relieve some of the stress on surviving family members because most important decisions about funeral services have been made in advance.
It also has the advantage of locking in the rates from when the plan is purchased—in case the rates increase in the future.
A downside of preneed funeral insurance is that purchasers are limited to funeral homes that work with Great Western.
Also, surviving family members don’t have access to the proceeds, and the funds can only be used for funeral and burial.
By contrast, final expense insurance can be applied toward estate administration, creditor claims, taxes, etc.
Great Western offers three different preneed funeral expense plans.
“Voyage” policies pay out the greater of the policy’s face value (with interest) or a return of premiums paid. Premium payments can be scheduled over 1, 3, 5, or 10 years, or paid via a single lump-sum premium.
“Course” pays out the face value, plus growth, and is available with more or less the same premium schedules as “Voyage.”
Finally, “Destination” is paid via one premium and is designed for individuals likely to pass away in the very near future.
“Voyage” and “Course” both have a couple screening questions for applicants. “Destination” does not.