Chelsey Tucker graduated with a Bachelor of History degree from Metropolitan State University in 2019. She now writes about insurance with her specialty being life insurance and has been quoted on Help Smart Phone and MEL Magazine.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years. He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com.

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent Daniel Walker

UPDATED: Mar 30, 2022

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When comparing life insurance companies as possible insurance providers, it’s very possible a consumer will come across two powerhouses in the industry, Aetna and USAA. Both have been well-established for decades in both quality life insurance and other financial protection businesses as well. However, what delineates one company from the other is both the marketing approach as well as the ratings on performance.

What Should You Know about Aetna?

Known as one of the corporate leaders in the insurance industry on a U.S. nationwide basis, Aetna has been in business for 154 years providing insurance products to clients big and small. Mainly known for its offerings in the health care insurance industry, Aetna also operates a life insurance division which has been in operation almost as long as the general company.

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Company Background

Headquartered in Hartford, Connecticut, the company boasts 34,000 employees and 16.6 million members with most of the enrolled in health insurance side rather than life insurance policies.

Company Products

Aetna’s insurance operations and sales are licensed to work in all 50 states of the U.S., and the company offers life insurance products in five different product categories. These include:

  • Standard term life insurance policies
  • Whole life insurance coverage
  • Businesses insurance packages that can be offered as employee benefits, including group term life insurance and group universal life insurance.

The company even offers a plan for highly risk occupations known as the AD&D ultra. This package addresses dismemberment and accidental death issues specifically.

What Are Aetna’s Performance and Ratings?

The company prides itself on a customer service, especially when rated by external agencies. Aetna won the title of Best Business in 2004 from the American Business Awards for companies with 2,500 or more employees. To continue this award-winning approach, Aetna commits itself regularly to individual customer attention and response, placing importance on individual service over bulk production. However, Aetna has not realized any notable awards recently. They still rank high on overall customer satisfaction. 

The results are as follows:

  • A.M. BEST – A
  • Fitch – A+
  • Moody’s – A1
  • Standard & Poor’s – A

One complaint some have Aetna is about their risk tolerance with experimental treatments. Aetna is one of the more conservative health insurers when it comes to approving payment for experimental treatments. However, their annual premium is generally low.

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Summary

Given the size of the company and employee base, Aetna is a traditional large scale corporation. In this respect, the company can leverage considerable assets to compete. Very often the company wins group insurance plans as result of its operational reach and ability to price competitively due to economies of scale.

What Should You Know about USAA?

As a life insurance company, USAA is not as old as some of its competition, but the company has definitely made up for that deficit with performance. A unique aspect of USAA as an insurance company in general is that it the company intentionally limits its market.

USAA only offers services and products to active and military families and single military members. They offer extremely low prices, and the risk is offset to a certain degree by having such a specialized group. Depending on which area you’re looking at, the benefits of military service might offset the risk for USAA.

By extension, the service can extend access to relatives’ spouses and children, but somewhere in the mix there needed to be a U.S. military service member enrolled with company. USAA auto insurance is extremely popular among eligible clients. USAA health plans are also extremely popular. When combined with auto policies and other coverage options, insured parties can save even more.

Where Did USAA Come From?

Established in the early 1960s, USAA Life Insurance has grown over the last almost 50 years to now holding a position of the 23rd largest life insurance company today. Sitting on $19.3 billion in net assets, the company can easily address member life insurance coverage without concerns of solvency.

The life insurance side of USAA is actually operated as two separate branches of the main company. There is USAA Life Insurance Company and then there is USAA Life Insurance Company of New York. Both operate in tandem offering their coverage products.

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What Insurance Products Does USAA Offer?

USAA provides life insurance as well as products for automobile insurance, health insurance, long-term care, Medicare coverage, property and homeowner’s insurance, and even banking and investment services.

If you’re looking at their collision coverage or other auto insurance products, USAA Auto Insurance still accounts for things like driving history, any at fault accident history, etc. But eligible military members and their families automatically receive a significant discount on rates compared to what they would pay for even minimal liability insurance somewhere else.

Within the life insurance realm, USAA provides members five different life insurance categories. These include:

  • Term life
  • Survivorship life
  • Permanent life
  • Long-term care life
  • Annuities

A unique aspect of the life insurance program comes with the USAA survivor relations team. Rather than wait for the member’s spouse to make contact, USAA sends out a company team to help a member’s family deal with a loss or a terminal illness status. This approach provides financial planning and guidance on steps families need to take next with the loss of a covered member.

Performance and Ratings

Because of its dedication to U.S. military members and their families, the company is highly committed to customer service and response. This in turn has won USAA significant customer loyalty as well as return business, even when other competitors may be offering cheaper prices for the same products.

In terms of performance and financial strength, USAA sits almost in the middle of the top 100 companies in the Fortune 500 rankings. Operating without any assistance from the federal government during the 2008 Recession, USAA sits today with almost $20 billion in operational assets and an enviable performance scoring as follows:

  • A.M Best – A++
  • Moody’s – Aa1
  • Standard & Poor’s – AA+

Additionally, USAA was ranked within Ward’s 50 for its 18th annual time, continuing to be included in the 50 top-ranked insurance companies nationwide.

Summary

Given the above information, USAA stands out as the stronger company to work with when it comes to insurance products and services. While Aetna has obviously been operating longer and with bigger size, USAA has consistently delivered a better service to its members as reflects by its continued growth as well as industry scoring.

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