Primerica Review – Can You Trust This MLM?
When it comes to multilevel marketing (MLM), Primerica is a little different from the typical company. Primerica is a large, publicly traded life insurance company that offers insurance and other financial products.
However, like other MLMs, Primerica’s sales representatives earn commissions not only from their sales but also from their downline sales. Questions still swirl about whether the company operates a pyramid scheme, but the scandals involving Primerica are much fewer than many other MLMs and life insurance companies.
Aside from a life insurance policy, Primerica offers other financial services, like mutual funds. This Primerica life insurance review will examine whether the company is a scam and whether you can trust it. We will also share Primerica’s life insurance cost.
Primerica Company Overview
History of Primerica
Primerica started in 1977 when it was founded by Arthur L. Williams, Jr. However, the company was called A.L. Williams and Associates. The company started selling term life insurance policies as a privately held general agency.
Over the next several years, the company underwent several mergers and acquisitions. It was first listed on the NASDAQ stock exchange in 1983. Primerica was born in 1987, and the company has used that name ever since.
Even after the birth of the Primerica name, the company continued through numerous mergers and acquisitions, which is common in the financial services industry. For several years beginning in 1998, the company operated as a subsidiary of Citigroup. The separation from Citi was completed in 2011, and the company has operated independently as a public company since then.
The company had an annual revenue of approximately $2.71 billion in 2022 and employed around 2,621 full-time employees. It also utilizes a network of 120,000 independent sales representatives. Today they sell Primerica life insurance policies, auto insurance, annuities, pre-paid legal services, and other financial services products.
Primerica seems to be among the few MLMs who have stayed pretty clean regarding scandals and investigations. Although there are murmurings about the company running a pyramid scheme, there have been relatively no substantiated claims.
Some sales representatives have become angered because they could not make much money selling the Primerica life insurance policy products. Still, many factors affect a person’s ability to make money with the company.
One of the biggest scandals involving the company stemmed from multiple 2012 lawsuits in Florida. The lawsuits alleged that sales representatives from the company convinced firefighters, teachers, and other public workers in the state to invest in risky financial products instead of leaving their money in more stable investments secured through the government.
The company ended up settling the lawsuits in 2014 for $15.4 million. However, as seen in Primerica’s life insurance reviews, the company has a low customer satisfaction ranking. Also, it is not always viewed as one of the best life insurance companies.
Current Company Structure
With Primerica being a publicly traded company, the current structure and governance are more transparent than most privately-owned MLMs. The company is headquartered in Duluth, Georgia, and operates like other public companies. A board of directors is in place to make strategic decisions for the company, and the company must make regular regulatory filings with the appropriate government bodies.
The company operates in the United States and Canada through its broker-dealer affiliates. Due to the highly regulated nature of their business, the company has found it difficult to expand beyond these two countries. Their approximately 120,000 independent sales reps operate through the company’s securities broker-dealer PFS Investments, Inc., in the U.S.
Primerica does not sell specific physical products like diet supplements or cleaning supplies like other multilevel marketing platforms. Primerica sells financial services products like life insurance coverage and investments.
Their original product, Primerica term life insurance, is their top seller. In addition, they have expanded their insurance offerings to include auto and home insurance and long-term care insurance.
Another big seller for Primerica is their investment products. They offer mutual funds, annuities, segregated funds, and managed accounts. Like any investment product, there is always risk associated. However, Primerica was named to the Forbes list of “America’s 50 Most Trustworthy Financial Companies” in 2015.
Lastly, Primerica offers a few other financial services solutions. These products include pre-paid legal services, debt management solutions, and identity theft protection. Most of the company’s products are targeted toward middle-income families looking for insurance protection for their family members and investment opportunities.
People can get a Primerica term life insurance policy for a specified period, usually 10 to 35 years. Also, Primerica is for those with a high financial strength rating.
The company’s policies start from $15,000 and depending on your financial strength, you can get more coverage, of up $10 million. As such Primerica term life policies are not for those looking for cheap life insurance. If you cannot afford Primerica’s term life insurance, you can get online quotes from multiple companies through an independent insurance agent.
Primerica Life Insurance Riders
A rider is an extra protection policyholders enjoy as an add-on. The followings are the riders offered by Primerica:
- Increasing Benefit Rider (policyholders can increase their coverage amount by 10% each year over 10 years)
- Waiver of Premium Rider (the insurer waives premiums for people who are critically ill)
- Child Rider (it covers eligible children listed in the policy)
- Terminal Illness Rider (the policyholder can access their death benefit if diagnosed with a terminal illness)
What Primerica Doesn’t Offer
We already know Primerica offers term life insurance and other extra coverage. The term coverage includes a custom advantage policy (it requires a life insurance medical exam) and TermNow (it has custom term lengths, with a maximum term of 35 years).
But what does Primerica not offer?
Primerica does not have permanent life insurance options like whole life insurance or universal life insurance. People who want any of these two have to work with other life insurers.
Company Marketing Practices
Unlike traditional MLMs and other life insurance companies, a vast social media following is not required for success with Primerica. The marketing here is much more about conventional networking and relationship building. Given the nature of the products being sold, people are much more likely to buy from someone they know and trust.
This can be both good and bad. Some old stereotypes about term life insurance sales hold proper here, and you must be a great salesperson to be a successful rep within the company. If you are uncomfortable with networking, cold calling, and complex sales, this is likely not the right opportunity.
Making Money With Primerica
Being listed by Forbes as one of the most trustworthy financial services companies in America shows that Primerica is a legitimate company with a real opportunity to make money. But how much do their sales reps make? According to Primerica, in 2018, they paid their reps an average of $6,069 for 12 months.
That amount is not good. As with all MLMs, some reps make significantly more than that, while many agents make nothing. Agents who can stick around and move up the ranks earn more commission on their sales as well as commission from the sales of their downline.
How to Enroll as a Rep
To enroll as a rep with Primerica, you must complete an Independent Business Application and pay a one-time $99 fee. To continue running your business, you must pay the $25 monthly fee to access Primerica Online. Reps can continue without the monthly fee, but they only get access to limited information online.
Once enrolled, reps must obtain specific licenses to sell all Primerica’s life insurance products. Most brokers have to obtain a state license to sell term life insurance. However, very few (only about 3%) go on to get their full financial advisor license so that they can sell the full suite of products.
Since Primerica does not publish specific commission percentages on its corporate website, it is somewhat challenging to get the details of how its commission plan works. However, some things about it are known. You earn more commission on your own sales as you move up the ranks.
A first-level rep earns a 25% commission on their own sales. At the top of the ranks, a Regional Vice President earns 95% commission on their personal sales of products. Recruiting is also a big piece of the puzzle as you can earn commission up to 11 levels deep in your downline. Licensing is also very important to your compensation, as you can sell additional products as you obtain additional licensing.
Sales and Marketing Techniques
The best technique for success here is good old-fashioned sales. Some people are not comfortable with this approach, but it is very much the nature of this business. The company encourages its local agents to schedule a Financial Needs Analysis, or FNA, with potential clients.
This analysis will walk the client through their current situation and help assess which products would be good purchases. From there, it is the rep’s job to convince the client to buy.
Comparison to Other MLMs
As compared to other MLMs, the upper-income potential is about the same. On industry average, Primerica reps do make a little more than most MLM distributors. Primerica’s products are also great because they help people, and you’re not just selling them on the latest diet fad or workout routine that they will likely only use once or twice. Primerica is a much more trusted company than most MLMs today.
Primerica is a legitimate company with great products and services that are useful to a large network of people. Being successful within the company requires hard work and traditional selling tactics.
To become a term life policy seller, you must complete an online application. Then, to move up the ranks, you must obtain financial licensing, which can be difficult and time-consuming. However, once you make it, you can earn residual income from the products you have sold for quite some time.
If you need an alternative to MLM, check out our top alternatives list.