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Fabric is a life insurance company focused around the financial needs of parents by providing term life insurance coverage. They also provide free tools and resources that help parents and young families plan their financial future.
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Term Life Insurance
FABRIC LIFE INSURANCE REVIEW AT A GLANCE
- Term life coverage for parents
- Quick application process
- Free wills
- Easy to use app
Overall Rating
Best term life insurance for parents
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As a new online term insurance startup, Fabric has helped to make it easier to get life insurance without needing to meet with an insurance broker or fill out numerous forms.
Fabric focuses on helping families and helps to streamline the process of obtaining life insurance. While the process is easier, others in the online life insurance space seem to offer more.
Many applicants still need to complete a medical exam and there aren’t as many policy options. That doesn’t mean that Fabric shouldn’t be one of the contenders when deciding between life insurance companies.
Keep reading our Fabric life insurance review for our take on the company, its products, and whether it’s the right choice for you.
Quick Summary
Offering: Term Life Insurance
Fees: as low as $10 per month
Promotion: No current promos
What is Fabric Insurance?
A InsureTech life insurance company, Fabric was founded in 2015 by Adam Erlebacher and Steven Surgnier and offers term life insurance and accidental death insurance.
Based in Brooklyn, New York it launched in 2017 with a seed round of $2.5 million and $10 million in 2018.
Applicants can complete the signup process online from start to finish, therefore removing insurance agents and brokers from being the middlemen so to speak.
Recent research into the statistics kept by the National Association of Insurance Commissioners shows that - for a company of its size - Fabric has fewer complaints and a better customer service record than most other providers its size.
This is seriously impressive - and a better service track record than even the best life insurance companies.
Fabric Life is available nationwide except for Montana.
However, only term life (not accidental death insurance policies) is available in Colorado, Massachusetts, North Dakota, Pennsylvania, Virginia and Washington.
Once approved, your policy is issued by the Penn Mutual company Vantis Life, established in 1847.
Penn Mutual, the second oldest mutual life insurance company in the U.S., owns Vantis Life.
In fact, Vantis Life has an A.M. Best A+ rating — aka it’s considered “superior”-- and an A+ rating from the Better Business Bureau.
What is an A.M. Best Rating?
A.M. Best is a ratings company that looks specifically at insurance companies and issues financial strength and credit ratings.
Think of it as a way to assess how reputable a company is and whether it’ll do what it says — aka pay out the policy amount your beneficiaries are owed.
So why is it so important to look at life insurance company ratings?
Well for one, think about how much is at stake if you don’t do your research carefully.
It’s similar to what you’ll do when purchasing a TV on Amazon or asking for recommendations for the best luxury resorts in Mexico.
You want to make sure you’re armed with the best information so that you can choose the best life insurance company for your needs.
With such an important financial decision such as this, you want to make sure that your loved ones are protected, especially if they rely on your income for their expenses.
Going back to A.M. Best — they’re an independent agency so you know they’re not swayed by other life insurance agencies.
You want to know that the life insurance agency you choose is highly reputable — aka it’ll honor what it says on it’s life insurance policies.
A.M. Best looks at the insurer’s claims-paying ability and financial strength.
That means the higher the rating, the more likely the insurance company will be able to pay out policies to your beneficiaries.
Like many other ratings agencies, A.M. Best will analyze various aspects of an insurance company like available cash flow, acceptable risk, management style, operating performance, balance sheet strength, and customer complaints.
After assessing these various factors, A.M. Best will then issue a financial strength rating (FSR) that is like a report card of sorts.
The ratings categories will indicate how likely an insurance company can not only meet its financial obligations, but how susceptible it’ll be to various factors like economic conditions and adverse underwriting.
What Services Does Fabric Offer?
Here are a few free and paid features of Fabric Life Insurance.
Term Life Insurance
Term life insurance is a type of temporary life insurance - covering the insured for a certain length of time.
Called Fabric Premium, Fabric term life insurance offers term lengths of 10, 15 or 20 years.
You can purchase policies with a death benefit value of $100,000 all the way to $5 million — purchase in increments of $50,000.
You cannot purchase a term life policy in Montana and for California and New York residents, you’ll need to purchase the company’s accidental death coverage before switching to term insurance.
Policyholders may also be able to convert their term life insurance policy to one of Fabric's whole life insurance products offered — but make sure you do your due diligence to see if it’s the right fit for you.
Fabric Premium covers most causes of death.
This can include:
- Homicide
- Vehicular crashes
- Cancer
- Fire
- Illnesses (such as heart attacks)
- Natural causes
- Diabetes
There are some exclusions to their coverage.
Some scenarios where your beneficiaries won’t get a payout include misrepresenting yourself during the application process and committing suicide within two years of the policy.
During the application process, you’ll probably need to have your medical history assessed and might get one or two questions about your family history of illness.
Meaning, the cost of your policy will depend on your lifestyle choices and overall health. Depending on how much life insurance you need, that may not be required (such as ones for up to $1 million in coverage).
What’ll happen is Fabric will use computer algorithms to look at your insurable risk then underwriters will look at your application more closely to determine if you need an exam.
Once you take out a policy, you won’t be able to increase its face value.
Unfortunately, you’ll need to go through the life insurance application process again and purchase a new policy.
That being said, you can lower your coverage amount at any time and convert it to a whole life insurance policy since it’s underwritten by Vantis LIfe.
Accidental Death Insurance
Called Fabric Instant, the insurer’s accidental death insurance policy is only for those between the ages of 25 and 50.
What that means is unlike a term life insurance policy, you’re only insured against death due to an accident while you’re covered, like dying from a car crash.
Since you can renew your policy each month, you can be covered up to 60 years old as long as you continue to pay your premiums.
Make sure you look at Fabric’s policy restriction before purchasing it since the insurance company considers an accidental death differently based on state of residence.
The good news is that there's no medical exam required like you would need for their term life insurance.
All you need to do is complete an online form which can take as little as a few minutes. Pay the policy amount and you’re guaranteed to be accepted.
The main downfall to the Fabric Instant is that you cannot be covered for paralysis or dismemberment — a lot of other insurers will for the same type of policy.
It’s only if you die due to an accident, not if you were to lose an arm or the ability to walk. This policy also won’t covered death from health issues like old age, suicide, intentional injury or disease.
There are also other exclusions which differ from state to state. If your accidental death falls into any one of these scenarios a claim can be denied:
- You die from an injury that occurred before you purchased coverage.
- Death due to voluntarily participating in a riot (attempting to stop one such as if you were a policemen or protecting your property doesn’t count)
- You were committing a crime or were incarcerated
- Your death was due to an act of war
- You were participating in any sort of racing or professional sports
- You were conducting any military-related activities which can include while you were deployed or training exercises
- You were under the influence of illegal substances, alcohol or a controlled substance that wasn’t used as prescribed and under the guidance of a physician
- You were participating in extreme sports
- You were using an aeronautic craft or participating in aeronautics
- You were using riding or hit by a vehicle that isn’t meant to be used in public roads (like an ATV)
Fabric Vault
This is a free app where you can securely share private information such as bank account numbers while you’re on the go.
Once you download the app and sign up for a free account, you can then invite your spouse or partner to do the same.
Fabric Wills
Fabric worked with legal experts to create a will for families to complete online.
There are different aspects such as appointing guardianship, making final arrangements and more, in as little as five minutes.
However, since your situation could be complex, Fabric recommends you speak to an attorney if you have questions about your estate planning.
How Much Does Fabric Cost?
Fabric’s accidental death policies are fairly inexpensive considering most people tend to die from health related reasons.
Here’s what you could pay for Fabric Instant:
Policy Size | Monthly Cost | (Oklahoma & New Jersey) |
|---|---|---|
$100,000 | $6.00 | $6.50 |
$250,000 | $15.00 | $16.25 |
$500,000 | $30.00 | $32.50 |
As for their term life insurance policies, it depends on age and health condition.
Fabric offers three examples of real-life quotes for 20 year terms:
- $14.61 a month for a $250,000 policy for a 29 year old female in excellent health
- $34.17 a month for a $750,000 policy for a 35 year old female in excellent health
- $41.46 a month for a $500,000 policy for a 42 year old female in excellent health
Generally speaking, the healthier and younger you are, the lower your policy premium.
Fabric also allows you to pay with either a debit or credit card — make sure your payment information is up to date or else your policy will be canceled.
At this stage it's worth noting that Fabric doesn't offer any life insurance riders (additional benefits or add-ons at no extra cost) - which is reasonable considering how low their prices are.
Life insurance, wills, & tools to organize your family's finances
How to File a Claim With Fabric
Hopefully this won’t happen, but if you do pass away from an event that’s covered in the policy, someone (whether it’s a family member of your beneficiary) needs to contact Fabric in order to request an Initial Death Claim Notification.
This person needs to do so within 20 days of your death and provide your personal details such as your name on the policy.
It’s also a good idea for you to provide family members and beneficiaries a copy of your Fabric policy in case something does happen and they need to provide details when calling.
After calling, your beneficiary will need to fill out a few claim forms from Vantis Life in addition to providing the company with a final death certificate.
Once you complete the steps then Vantis Life Insurance Company will then decide if an investigation is needed.
If so, it’ll request your beneficiaries to provide additional information.
Once it’s been determined that everything’s good to go, your beneficiaries can expect to receive a payment (they’ll need to wait a few days).
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How to Sign Up For Fabric
Signing up for Fabric is a relatively simple process. Head to their website and choose their accidental death or term life policy.
Remember, accidental death insurance will only pay out if you die from an accident, not from other causes like disease.
You can keep this policy until you’re 60 or until you decide to purchase their term life policy, which pays out from illnesses or accidents.
Again, the term life policy is only available in Colorado, Massachusetts, North Dakota, Pennsylvania, Virginia and Washington.
Residents in California and New York can start off by getting the accidental death policy then upgrading to term life if you choose.
Once you decide what you want, the application process can take only a few minutes.
For the accidental death policy, you don’t need to provide any health information since you’ll be guaranteed acceptance.
The term life insurance on the other hand, you’ll need to answer a series of questions relating to your health.
In some cases, you may be issued a policy without needing to complete a health exam.
If you do, you can schedule a time on Fabric’s website and a paramedical professional will come to your home or office at the appointed time.
Afterwards, you’ll need to wait five to seven business days for Fabric to review the exam results and to give you a decision (including the price for your proposed policy).
Final Verdict
Although it can be a longer process to apply for a term life insurance policy — since many applicants will need to complete a medical exam — it’s still worth looking at Fabric Life.
For one, they’re a highly rated insurance agency and offer fairly competitive pricing.
Plus, they offer free online wills and their Fabric Vault, where you can share confidential information securely.
At the very list, put it on your list of life insurance companies to research.
Fabric Insurance
Fabric is a life insurance company focused around the financial needs of parents by providing term life insurance. They also provide free tools and resources that help parents plan their financial future.
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I'm a Fintech, personal finance, investing, alternative investments, credit, small business, careers, loans, money mindset, retirement and debt writer.
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