Life Insurance FAQs
What is life insurance?
Life insurance is a contract on the life of an individual (the “insured”) between an individual (the “policy owner”) and an insurance company in which the policy owner pays monthly premiums to the insurance company while the insured is alive in return for a sum of money paid out to chosen beneficiaries when the insured passes away.
Learn more about life insurance and our product offerings here.
What are my options for term length?
For Level II Plus term life insurance policies, your term length options are 10, 15, 20, 25, or 30 years.
If you are considering a Flex Term policy, the policy will last until you turn 50 years old (or 40 if you are a nicotine user).
Does a term policy automatically renew at the end of the term?
Term policies do not automatically renew upon the completion of the term. If you are near the end of the term on your policy and would like to speak to a representative, contact us at 888-300-9331.
Is there an age cutoff for term insurance?
Yes, you must be under 76 years old to apply for term insurance.
What is the oldest age at which I can apply for a life insurance policy?
If you are applying for Flagship Whole Life insurance, you must under 81 years old. If you are applying for term insurance, you must be under 76 years old.
Does a term life insurance policy have a cash value?
No, this type of policy does not have a cash value.
What is a Level Term conversion?
A Level Term conversion is an opportunity to convert a Level II Plus Term policy to a Flagship Whole Life policy.
You can convert Level II Plus Term coverage to Flagship Whole Life coverage at a guaranteed rate with no medical exam provided that 1) your term duration has five or more years remaining and 2) the insured is under the age of 71 and the policy’s anniversary date has not passed. The premiums for your Flagship Whole Life coverage will be based on the insured’s age at the time of conversion.
You may call 888-300-9331 to confirm your conversion deadline.
Do premiums change over time?
Premiums remain in effect at their set price for the duration of the policy’s term.
For Flagship Whole Life policies, this means that premiums will never change.
For Flex Term policies, the premiums will remain the same for the duration of the policy’s term. Once the policy expires after the length of the set term, if you should decide to get a new policy, premiums may be different, as they are based on an updated medical exam and medical history review.
For Level Term policies, the premiums will remain the same for the duration of the Level Term period. After the Level Term period, renewal premiums will be computed annually based on the insured’s attained age, gender, nicotine use, and face amount of insurance.
What is the maximum amount in Paid-Up Additions I can purchase for a whole life policy?
Paid-Up Additions (PUA) are subject to a maximum of three times the base annual standard premium after the issue date per policy. Paid-Up Additions can be used to increase your policy’s total death benefit and cash value by up to a total lifetime maximum of $500,000 for all combined policies.
What are annuities?
An annuity is a contract that allows you to invest a sum of money with a life insurance company in exchange for a guarantee of future fixed income over a set period or even a lifetime.
Learn more about annuities and our product offerings here.
What amount can be taken as a withdrawal from an annuity?
You can withdraw up to 10% of the annuity’s accumulated value annually. Withdrawals can be taken freely from settlement options (excluding the life income option) as long as the accumulated value remains over $10,000.
Does the 10% withdrawal rule for purchased annuities reset on January 1 or the annuity’s contract anniversary?
The 10% annual free withdrawal amount resets on the annuity’s contract anniversary.
Can a Member contribute additional funds to annuities?
Members can contribute additional funds to Flexible Premium Retirement Annuities only. Funds can be sent to Navy Mutual via check, bank draft, or wire transfer.
What amount will be taxable upon taking a withdrawal from an annuity?
Withdrawals from annuities are taxable to the extent of any gain on the contract.
What is the maximum amount I can purchase as an annuity?
You can contribute up to $5,000,000 to a Single Premium Deferred Annuity. You can contribute up to $1,000,000 to a Flexible Premium Retirement Annuity.
What interest rate am I guaranteed on new money?
You can view current annuity rates here.
Can I assign ownership to someone else? Will the annuitant change as well?
Yes, an absolute assignment and transfer of ownership can be executed on annuities during the life of the annuitant. Absolute Assignments do not change the annuitant of the contract.