Transamerica at a Glance: Rates, Products and Reviews

Transamerica, originally founded as the Bank of Italy by Amadeo P. Giannini, began in 1904. Known for its iconic tower in the San Francisco skyline, Transamerica joined Aegon Ltd. in 1999 as part of their international financial services organization. Transamerica boasts 10.3 million customers and sells retirement services, insurance and annuities in all 50 states including D.C.

Transamerica offers two types of annuities: registered index-linked annuities, or RILAs, and variable annuities. Both annuities are regulated as securities and not as insurance products.

Sometimes called structured annuities, registered index-linked annuities provide investors with participation in a market-based index with added downside protection options in the event that the market falls. Distinguished from fixed index annuities, RILAs do not offer complete downside protection, meaning there is a possibility to lose money. This added risk is offset by having higher caps or no caps on the potential gains.

Offering a one-, two- or six-year crediting period, the Transamerica Structured Index Advantage annuity offers a variety of customizable options for consumers to choose from. There are five different market indices to pick from including the S&P 500 and Russell 2000, as well as a fixed option to guarantee your principal. Protection options come in 10%, 15% or 20% buffers. Certain optional riders are available for an additional cost.

Variable annuities offer tax-deferred, market-based investments with optional contract riders that offer additional guarantees for income, withdrawals, death benefits and more. The most basic variable annuities will not offer any protection from market losses. All options have minimum initial premiums of $1,000 for qualified accounts and $5,000 for non-qualified accounts.

Transamerica’s annuity products focus on offering consumers access to market participation with protection. While their annuities do offer investment options that can be fixed and guaranteed, the primary goal of these annuities is to capture the growth potential of the stock or bond markets.

The benefits of these annuities will be best utilized by investors who want to boost retirement savings and defer additional savings in excess of the limits set by typical retirement plans like 401(k)s or IRAs. The buffers available on the RILA product and the optional protection measures available on the variable annuity products will appeal to soon-to-be retired investors who need some added downside protection as they approach retirement. Living benefits can provide peace of mind when it’s time to activate your income stream.

The performance of these products is tied directly to the underlying performance of the indices selected within the annuity products. Consumers considering Transamerica’s annuity offerings should request a recent brochure or prospectus with the most up-to-date rates, terms and performance guarantees before purchase.

Financial strength and stability are critical indicators of an insurer’s ability to meet its obligations to policyholders. Transamerica’s robust asset management and backing by Aegon Ltd. underscore its commitment to maintaining a secure financial foundation for its customers.

Transamerica scores good, but not great, for credit risk when compared to larger and more established insurers. All of their ratings fall firmly in the upper-medium-grade and therefore they are judged to be subject to low levels of credit risk.

Transamerica, on its own, has $427 billion in assets under management and 10.3 million customers with over 12 million policies currently in force. Over the course of its history, it has processed 3.1 million claims amounting to roughly $47 billion in benefits paid out. Transamerica’s history demonstrates the seriousness with which it takes its customer responsibilities. As a part of the larger Aegon organization, Transamerica has the secure financial backing of a multinational corporation which stands behind its financial commitments.

The standard measure of client satisfaction in the insurance and annuity industry is the National Association of Insurance Commissioners’ (NAIC) Complaint Index, a yearly report produced on all insurers. This report compares a given insurer’s complaints against the entire industry.

According to Transamerica’s most recent report (2023), the National Complaint Index is always measured as 1.0. A score of 2.0 is twice as high as the broader industry average, while a score 0.5 is half as high as the broader industry average.

Transamerica’s life insurance division scored below average on the 2023 J.D. Power Customer Satisfaction Index Ranking, which measures the overall customer satisfaction of insurance companies and annuity providers. Transamerica scored a 757 out of 1,000 scale -well below the study average of 790- and ranked 21st out of 23. Transamerica was not rated for annuities.

Understanding the pros and cons of Transamerica’s annuities is essential for potential investors looking to secure their financial future. By evaluating the benefits and drawbacks, consumers can make informed decisions that align with their retirement goals and overall financial strategies.

Transamerica does flaunt some distinct benefits, but otherwise doesn’t demonstrate significant differentiation in products or service. They offer many alternative financial products outside of life insurance and annuities, which may allow some consumers to consolidate their whole financial lives with Transamerica. However, they do not offer individual standout performance within their various business lines.

Editor Norah Layne contributed to this article.