Lincoln Financial is one of the best life insurance companies in the U.S. and is an excellent choice for variable universal life insurance, consistently ranking as one of the top companies in VUL sales each year.
In the following Lincoln Financial Review, we will discuss the history of the company, its ratings, and look at the various insurance products offered.
About Lincoln Financial
The consortium now known as the Lincoln Financial Group was founded in Fort Wayne, Indiana, in 1905 as the Lincoln National Life Insurance Company. The company’s founders sought and received permission from Robert Todd Lincoln to use President Lincoln’s image in their business and have continued doing so for over 100 years.
In 1998, Lincoln National Corporation, parent company of Lincoln Financial, moved its headquarters to its current Philadelphia location, where the company sponsors the home of the Philadelphia Eagles NFL team.
As of 2020, Lincoln Financial ranks 22nd on the Fortune 500 list of companies by assets and 188th by revenue. Lincoln Financial’s $17 billion in revenue in 2019 was fourth among life and health insurers.
The company ranks 2nd and 4th in the U.S. in universal life and term life sales, respectively, and, according to LIMRA rankings, first in total life sales. Source.
Lincoln Financial Group Financial Ratings
Lincoln Financial is an exceptionally strong company in terms of financial stability. The company’s assets are primarily held in low-risk assets, and Lincoln keeps significant wealth in cash or cash-based holdings. Thus, policyholders face very little risk that the company will fail to meet policy obligations.
Ratings current as of September 2020.
- A.M. Best: A+
- Fitch: A+
- Moody’s: A1
- S&P Global: AA-
- Comdex Ranking: 91
J.D. Power’s consumer satisfactions ratings score Lincoln Financial as about average for the insurance industry.
Lincoln Financial has been BBB-accredited since 1979, but does not currently have a rating issued by BBB. Consumer reviews for the company are limited.
Products Offered by Lincoln Financial:
- Term Life Insurance
- Universal Life Insurance
- Fixed, Fixed Indexed, and Variable Annuities
- Retirement Planning
- Long-Term Care Planning
- Employee Benefits Administration
Life Insurance Policies Offered by Lincoln Financial
Lincoln TermAccel (Term Life):
TermAccel is a level term policy designed to provide inexpensive term coverage for younger applicants with a quick and non-burdensome application process.
Policies are available for new insureds up to age 60 in coverage amounts from $100,000 to $1 million.
10, 15, 20, and 30-year terms are available, though the 30-year term is only available through age 55. Policyholders also have the option of reducing coverage after three years.
TermAccel policies can be renewed annually through age 95, with premiums increasing upon each renewal. If a policy is renewed after its initial term, the face value will decrease, though the decrease only occurs once at the first renewal.
Although not your typical no exam life insurance policy, the application for TermAccel occurs online or through an over-the-phone interview.
Though the policy normally requires a medical exam, the requirement can be waived for eligible applicants ages 18-60 on face amounts of $1,000,000 and less.
Eligibility for the waiver is based mostly on the insured’s tobacco-use classification, and a significant percentage of applicants receive the waiver. Thus, most non-tobacco users can obtain life insurance from Lincoln Financial without a medical exam.
Applications for TermAccel are generally reviewed quickly, particularly if no exam is required. Lincoln Financial states that new insureds who qualify for the exam waiver can usually get approved for coverage in around two days.
Lincoln offers a conversion option with its term policies. If exercised during a policy’s initial term (or before age 70, whichever comes first), the option allows the policyholder to convert term coverage into a permanent policy.
Lincoln Life Elements (Term Life):
Life Elements provides level term coverage starting at $250,000 and going as high as $1 million for new insureds under 55. The coverage level is reduced to $500,000 for new insureds 55 through 60. However, increased coverage amounts are sometimes available, subject to underwriting on a case-by-case basis.
New Life Elements insureds can be anywhere from 18 to 80 years old, though longer term lengths are only available for younger applicants. Policies can be renewed annually through age 95, with premiums increasing upon each renewal. If a policy is renewed after its initial term, the face value will decrease, though the decrease only occurs for the first renewal.
Application for Life Elements occurs through a telephone interview or electronically. As with TermAccel, qualifying applicants do not require a medical exam, though the exam waiver is not available if over $1 million in coverage is sought.
Final Expense Insurance:
Lincoln Financial is not currently offering any final expense insurance policies.
Lincoln Heritage Life Insurance Company, one of the country’s largest final expense carriers, is not affiliated with Lincoln Financial Group.
Lincoln LifeGuaranty (Universal Life):
Lincoln Financial’s basic universal life insurance comes in two varieties: Life Guaranty UL and Life Guaranty SUL.
Both versions allow flexibility in coverage amounts and premium payments, subject to minimum requirements.
Both policies accrue cash value, which can be accessed through policy loans or surrenders and which can also be applied toward premium obligations.
The principle difference between the two universal life policies is that SUL is a survivorship policy covering two insureds. The death benefit pays out upon the second insured’s death—making the policy more useful in estate planning than as a means of income replacement or retirement savings.
Lincoln Financial’s universal life offerings are available with long-term care riders allowing policy benefits to be applied toward long-term care costs, with any paid-out amounts reduced from the future death benefit
Lincoln Indexed Universal Life:
Lincoln Financial offers two indexed universal life options.
WealthAccumulate IUL is geared more toward cash-value accrual, with policy growth linked to the S&P 500 index. Growth rates are capped and do not include dividends, so returns may not be quite as high as market returns. But they are also subject to floors, limiting or eliminating losses in down years.
WealthPreserve IUL is geared toward the death benefit and comes with a death benefit guaranty that lasts either 40 years or until the insured’s 90th birthday (whichever is first). Policy interest of at least 1% is guaranteed to accrue each year.
Lincoln Variable Universal Life:
Lincoln’s variable UL policies measure cash value growth according to performance of various investment options made available by Lincoln and selected by the policyholder.
Lincoln VUL One offers a guaranteed death benefit, which can be extended if policy investments reach a defined threshold. Alternatively, cash value can be applied to premiums if the balance grows sufficiently.
AssetEdge VUL features over 75 different investment options, four indexes, and a fixed account to choose among, along with an available 20-year no lapse guaranty.
AssetEdge Exec VUL is designed for businesses and executives as a means of funding long-term compensation and bonus plans. Lincoln Financial also offers several other specialized variable UL policies.
Available Life Insurance Riders
Terminal Illness Rider:
The terminal illness rider allows acceleration of a policy’s death benefit if the insured is diagnosed with less than 12 months to live.
Children’s Level Term Rider:
The Children’s Level Term rider provides level term coverage for all of the insured’s minor children up to $15,000.
Waiver of Premium:
If the insured becomes totally disabled, premium obligations are waived while the insured remains disabled.