Penn Mutual Life Insurance Review

by | Jun 5, 2022 | Insurance Companies

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Penn Mutual is a mutual Life Insurance company, which means that it only answers to policyholders, not shareholders. This way, the company can focus on making decisions for its customers without having to look out for investors’ needs.

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The company offers a comprehensive portfolio of insurance products which allows it to accommodate the needs of all clients and prospective clients. For individuals considering permanent life insurance as part of their retirement planning, Penn Mutual whole life insurance is a solid choice for accumulating wealth over time that can be accessed during retirement without personal income tax liability.

About Penn Mutual

Penn Mutual Life Insurance Company has a long and storied history, dating back to 1847. The company was founded by a group of Quakers in Philadelphia, who believed in the power of insurance to help people financially protect themselves and their families.

 Today, Penn Mutual is one of the largest life insurance companies in the United States, with over $50 billion in assets. Penn Mutual offers a wide range of life insurance products, including term life, whole life, and universal life policies. The company also offers annuities and other financial products.

In addition to its product offerings, Penn Mutual is known for its strong financial stability and excellent customer service. If you’re looking for more information on Penn Mutual Life Insurance Company, be sure to keep reading as we provide you with an in-depth look at the company’s history, products, financial stability, and customer service.

Penn Mutual Financial Ratings

Penn Mutual Life Insurance has long been one of the most financially stable life insurance companies in the United States. The company’s recent financial ratings from A.M. Best and Standard & Poor’s continue to reflect this stability, with both organizations awarding Penn Mutual their highest possible ratings.

Penn Mutual’s ratings from A.M. Best are as follows:

A++ (Superior) for the company’s financial strength rating-A+ (Excellent) for the issuer credit rating. These ratings from A.M. Best reflect Penn Mutual’s “superior ability to meet its ongoing obligations to policyholders” and reflect the company’s “excellent” financial strength and operating performance.

Standard & Poor’s Ratings:

Standard & Poor’s has also awarded Penn Mutual their highest possible ratings, with a ‘AAA’ rating for the company’s financial strength and an ‘A-1+’ rating for their issuer credit rating. Standard & Poor’s notes that Penn Mutual’s ratings reflect the company’s “exceptional” financial strength and its “very strong” ability to meet policyholder obligations.

Penn Mutual Life Insurance Products

Penn Mutual Life Insurance offers a variety of life insurance policies to meet your needs. Whether you’re looking for term life insurance, whole life insurance, or universal life insurance, Penn Mutual has the policy to fit your needs.

Whole Life Insurance

Penn Mutual offers whole life insurance to provide security and coverage in your lifetime. Whole life guarantees it will pay out when the policyholder dies, and the cash value builds over time because of guaranteed interest earnings and annual dividend payouts to policyholders.

This policy will provide death benefit protection for a whole life span of 121 years, and once issued, your premiums are locked-in. There are multiple periodic pay periods to choose from and you can also customize your policy with any combination of optional policy riders.

Penn Mutual’s participating whole life insurance is a solid choice for individuals who want to buy whole life insurance to supplement their retirement planning. With guaranteed tax-deferred interest and annual dividends, participation whole life can accumulate significant wealth over time.

Term Life Insurance

Term life insurance is a great option for anyone with a set budget and the need for immediate protection. These policies are guaranteed to provide death benefits at a competitive rate that won’t increase during your term period. You also have the chance to turn this term life insurance into permanent life insurance (conversion option) when your policy expires, without having to answer any health questions.

Term Life Insurance is generally the most popular policy choice for individuals who want to purchase a large death benefit at the most affordable rates.

Universal Life Insurance

Penn Mutual offers six universal life insurance policies to fit a variety of different needs. The indexed universal life policy links your cash value growth to the performance of an index, such as the S&P 500, and if you want to choose the investments your money will be funneled into, then variable universal life insurance might be a good option for you as well.

The types of Universal Life insurance currently offered by Penn Mutual are:

  • Traditional Universal Life
  • Indexed life (Builder Select Indexed Universal Life or Accumulation Builder Select Indexed Universal)
  • Variable universal life
  • Joint or survivorship Indexed Universal Life

Life Insurance Policy Riders

Insurance riders are offered as an optional extension or add-on to a policy. Riders are additional provisions in insurance policies that extend protection or provide additional coverage such as Penn Mutual’s Chronic Illness Accelerated Benefit.

  • Guaranteed Increase Option – This rider provides for the insured to increase the death benefit without additional medical underwriting. This optional rider can be exercised at ages 22, 25, 28, 31, 34, 37, 40, 43, and 46; or if the insured gets married or has a child or adopts a child. Insureds must be 40-years old or younger to purchase this rider.
  • Disability Waiver of Premium – The disability waiver is available to policyholders who become disabled and unable to work. The rider is subject to a 4-month waiting period.
  • Accelerated Death Benefit – The Accelerated Death Benefit rider provides for the policyholder to be advanced up to 50% of the death benefit or $250,000, whichever is less if diagnosed with a terminal illness. When the insured dies, the amount of the advance is deducted from the death benefit.
  • Chronic Illness Accelerated Benefit – Typically included with most Penn Mutual policies, the chronic illness rider provides for the insured to be advanced a portion of the death benefit to cover expenses for managing a chronic illness.
  • Children’s Term Rider – The children’s term rider is available for the insured to insure all children in the household for one premium amount. Regardless of the number of children in the household, the company will only charge one. Coverage is provided until a child reaches age 23 and the term coverage can be converted to permanent life insurance without the need for additional medical underwriting.

Penn Mutual Life Insurance Pros and Cons

Pros:

  • They have been in business for over 170 years and are a highly rated company
  • They offer a variety of life insurance policies to choose from.
  • They have an excellent financial rating.
  • They offer policyholders the ability to customize their policy to fit their needs.
  • The company has an excellent track record for paying dividends to policyholders

Cons:

  • Some of their policies are more expensive than others.
  • You may have to undergo a medical exam to qualify for certain policies.
  • Their customer service hours are limited.

Frequently Asked Questions

Is Penn Mutual's whole life insurance good for funding a LIRP?

Yes. Penn Mutual’s whole life insurance is perfect for funding your Life Insurance Retirement Plan because of the paid-up will additions option that you can select for annual dividend payments. This way your paid-up additions will create new small life insurance policies that will also earn guaranteed interest and dividends.

Are whole life policy loans taxable?

Since policy loans are not considered income, the money you receive from a policy loan is tax-exempt.

Do policy loans from Penn Mutual have to be repaid?

Although you will be charged interest on outstanding policy loans, you are not required to pay the loan(s). However, all outstanding loan amounts and interest will be deducted from the death benefit when you die.

Does Penn Mutual offer a guaranteed death benefit increase option?

Yes. Additionally, this optional rider can be exercised at ages 22, 25, 28, 31, 34, 37, 40, 43, and 46; or if the insured gets married or has a child or adopts a child. Insureds must be 40-years old or younger to purchase this rider.

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