Ally Term Life: How to Choose the Best Term Life Policy

Ally Term Life insurance is a type of life insurance policy that provides coverage for a specific period of time, known as the “term”. If the policyholder dies during the term, their beneficiaries receive the death benefit payout. If the policyholder outlives the term, the policy simply expires without paying out a benefit.

Term life insurance is one of the most affordable forms of life insurance because it only provides temporary protection. There is no cash value built up like with permanent life insurance policies. Term life is intended to provide income replacement if the insured dies prematurely during their working years.

Ally Financial offers term life insurance policies with 10, 15, 20, and 30 year term lengths. Ally term life provides guaranteed level premiums during the initial term period. This means the monthly premium will not go up. Ally also allows policyholders to renew their coverage for another term at the end of the initial term without having to medically requalify.

Ally term life insurance provides pure death benefit protection only for the specified term length. It does not accrue cash value and does not have any investment or savings components. The goal is to protect loved ones with affordable coverage during working-age years when income replacement is most crucial.

Benefits of Ally Term Life

Term life insurance through Ally offers several key benefits that make it an attractive option for many consumers.

First, term life is typically the most affordable form of life insurance. Premiums are lower compared to permanent forms of life insurance because term policies provide coverage for a defined period of time rather than lifetime coverage. This makes term life very budget-friendly, especially for younger and healthier individuals who may not need lifelong insurance.

Term life also provides coverage for a set period of time, such as 10, 15, 20, or 30 years. This allows people to match their coverage period to specific financial needs, like covering a mortgage or getting children through college. Once the term expires, coverage ends unless renewed. This flexibility is a major perk of term life.

Lastly, term life premiums are substantially lower compared to permanent forms of life insurance. Term does not contain cash value components which increase the costs of permanent life. This makes term life very affordable for the coverage amount obtained. Individuals can often get 10 times more coverage for the same premium dollar compared to whole life insurance.

In summary, the low cost, temporary coverage period, and lower premiums compared to permanent insurance make term life policies advantageous for many policyholders. Ally term life provides these essential benefits.

Drawbacks of Ally Term Life

Ally Term Life insurance, like most term life insurance policies, comes with some drawbacks to consider:

Coverage expires after term length

The key drawback of term life insurance is that it only provides coverage for a set number of years, known as the “term length.” Once the term expires, coverage ends unless you renew your policy. However, renewal premiums will be higher as you age. This means term life does not provide lifelong coverage like whole life insurance.

Premiums increase as you age

Term life premiums are based on your age and health status when you first buy coverage. As you get older, premiums will increase upon renewal because the risk of death rises with age. This makes term life more expensive the longer you keep it.

No cash value accumulation

Term life policies do not build up cash value like whole life insurance does. This means if you cancel your policy, you won’t get any money back. The premiums simply pay for the death benefit protection.

Ally Term Life Policy Options

Ally Financial offers several term life insurance policy options to choose from. This allows you to customize coverage to your needs and budget.

Term Lengths

Ally has term lengths of 10, 15, 20, 25, and 30 years. The longer the term, the higher the premiums. But longer terms provide coverage for more years. Term lengths up to 30 years are great for protecting young families over decades.

Shorter terms of 10 or 15 years have lower premiums. These work well for temporary insurance needs, like covering a mortgage.

Coverage Amounts

Ally offers coverage amounts from $100,000 up to $1 million. Some term lengths may cap coverage lower than $1 million.

The amount you need depends on factors like income replacement and funeral costs. Most experts recommend at least 10 times your annual income in coverage.

Riders and Add-Ons

Ally has several riders to customize your policy:

  • Accidental Death Benefit: Pays extra if death is accidental
  • Waiver of Premium: Waives premiums if disabled
  • Living Benefits: Pays benefit early if terminally ill

You can also add a child term life rider. Ally doesn’t offer a conversion option to switch to permanent life insurance later on.

Costs of Ally Term Life

The cost of Ally term life insurance depends on several key factors, including:

  • Age – Premiums are higher for older applicants as risk of death increases with age. A 30 year old may pay $30 per month, while a 50 year old may pay $100 for the same coverage.

  • Gender – Women generally have lower premiums than men of the same age since they tend to have longer life expectancies.

  • Health – Applicants in excellent health can qualify for preferred rates, while those with medical conditions may pay higher premiums.

  • Coverage Amount – More coverage means higher premiums. A $250,000 policy costs more than a $100,000 policy.

  • Length of Term – Longer terms like 20 or 30 years have higher premiums than shorter 5 or 10 year terms.

To give an example of potential costs, here are estimated monthly premiums for a healthy 30 year old:

  • $250,000 coverage for 10 years: $16
  • $500,000 coverage for 20 years: $27
  • $1,000,000 coverage for 30 years: $43

A 50 year old may pay around:

  • $250,000 for 10 years: $43
  • $500,000 for 20 years: $73
  • $1,000,000 for 30 years: $116

Premiums can vary significantly based on individual attributes, so it’s best to get a personalized quote from Ally. Overall, Ally offers competitively priced term life insurance tailored to your needs and budget.

How to Apply for Ally Term Life

Applying for an Ally term life insurance policy is a straightforward process that involves submitting an application, taking a medical exam, and going through financial review. Here’s an overview of what to expect:


You can apply for Ally term life insurance online or over the phone. The application asks for basic information like name, date of birth, address, beneficiaries, and coverage amount. It also includes health and lifestyle questions that determine your eligibility and rates. Completing the application takes 15-20 minutes.

Medical Exam

All Ally term life applicants must take a medical exam, even if you’re in perfect health. It checks vital signs like blood pressure, height/weight ratio, and cholesterol. A paramedical examiner will come to your home to conduct simple tests and take fluid samples. Getting exam results takes 2-3 weeks.

Financial Review

Ally reviews your finances, including income, net worth, existing policies, and more. This ensures you can afford the coverage. Supporting documents like tax returns may be requested. The financial review aims to prevent over-insuring.

Tips for Best Rates

To potentially qualify for Ally’s lowest premiums:

  • Maintain a healthy weight for your height
  • Keep blood pressure, cholesterol, and glucose in a normal range
  • Have a clean medical history with no major conditions
  • Avoid risky hobbies like scuba diving or rock climbing
  • Limit alcohol use and don’t smoke or use nicotine
  • Demonstrate stable finances and income sources

Following the straightforward application process helps ensure you get approved for Ally term life insurance at the best possible rate for your situation. Be prepared to invest time upfront for the medical exam and financial review.

Ally Term Life Underwriting

The underwriting process for Ally Term Life insurance aims to accurately evaluate and price your policy based on your health and lifestyle factors. The insurance company will ask for information about your medical history, family health history, driving record, hazardous activities, and other potential risk factors.

Some conditions that may lead to higher premiums or coverage denial include:

  • Chronic illnesses like heart disease, cancer, diabetes, etc. Having these conditions does not automatically disqualify you, but premiums may be higher.

  • Mental health disorders that require hospitalization or intensive treatment. Situational depression/anxiety is often not an issue.

  • Substance abuse and addiction issues, especially if ongoing or recent. May require a period of sobriety before approval.

  • Dangerous hobbies like skydiving, rock climbing, etc. May need to pay more or have exclusions.

  • Poor driving history with multiple tickets, accidents, DUIs. Can increase costs significantly.

  • Travel to high risk countries. Potential for exclusions or limitations.

  • Occupations with increased mortality rates like pilots, loggers, etc. May get rated policies.

  • Obesity, high cholesterol, high blood pressure. Can increase premiums but usually still insurable.

The underwriter will evaluate the severity, timeframe, and control of these conditions before finalizing your rate class. It’s important to fully disclose your history to avoid denial of future claims. Overall, Ally’s underwriting aims to balance affordable premiums with adequate risk assessment.

Ally Financial Background

Ally Financial has a long history dating back to 1919 when it was founded as General Motors Acceptance Corporation (GMAC) to provide financing to automotive customers. Over the decades, GMAC expanded into other lending services beyond automotive loans and by the 2000s became a leading mortgage lender in the US.

In 2006, the company rebranded as Ally Financial to reflect its diversified financial services beyond just the automotive industry. Throughout the financial crisis in 2008-2009, Ally received government bailouts and support totaling over $17 billion. This enabled the company to survive the crisis when many other lenders failed or faltered.

Today, Ally Financial is considered a reputable and financially strong institution. It’s a leading digital financial services company offering banking, lending, investing and insurance products. Ally has over 10 million customers worldwide and $186 billion in assets as of 2021. The company is well-capitalized with strong credit ratings from agencies like Moody’s and Standard & Poor’s.

Ally’s history demonstrates its ability to adapt and evolve over many decades in the financial services industry. While the company stumbled during the financial crisis, it has rebounded strongly and continues serving customers with a solid financial foundation. This gives confidence that Ally has the financial strength to support its insurance products like Ally term life policies.

Customer Service and Claims

Ally Term Life offers customer support via phone and email.

To file a claim for an Ally Term Life policy, you’ll need to call their claims department at 1-877-380-4220. You should have information about the deceased readily available, including their full name, policy number, date of birth, date of death, and cause of death. The claims associate will walk you through the documentation needed to process the claim, such as a certified death certificate and possibly medical records depending on the cause of death.

Once all documentation is submitted, Ally Term Life aims to process claims within 10 business days. The death benefit will be paid out to the named beneficiary(ies) on record. The claims process can be difficult during a time of grief, so Ally strives to handle claims sensitively and efficiently. Their claims associates are specially trained to provide excellent customer service through the process.

Is Ally Term Life Right for You?

When considering whether Ally term life insurance is the right fit, it’s important to weigh the pros and cons.

Pros of Ally Term Life:

  • Competitive pricing, especially for healthy applicants
  • Ability to get quotes and apply completely online
  • Good financial strength ratings from A.M. Best and S&P
  • No-cost policy conversion option
  • Accelerated death benefits for terminal illness

Cons of Ally Term Life:

  • Limited policy customization options
  • No riders available to expand coverage
  • Mixed reviews of claims process from customers
  • Not available in NY or WA states

Alternatives to Consider:

Those looking for more flexibility may want to consider term life from companies like Banner Life, Haven Life, Ladder Life, or Bestow. These insurers offer a wider range of term lengths, coverage amounts, and riders.

Permanent life insurance or whole life policies from top mutual companies like New York Life, MassMutual, and Northwestern Mutual are also alternatives for lifetime coverage.

Who Should Consider Ally Term Life?

Ally term life is a good option for healthy individuals who want an affordable term life policy with online convenience but don’t need a lot of bells and whistles. It can provide temporary coverage for young families needing financial protection.

Shoppers wanting a basic term life plan can get quotes from Ally, but may also want to compare with other top low-cost term life companies. Weigh the pros, cons and your specific needs to decide if Ally term life fits your situation.

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