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If you’re a new parent, you may feel a level of financial stress and responsibility that you haven’t experienced before. Fabric by Gerber Life is a company that aims to alleviate a bit of that stress by serving as a one-stop shop for several of your financial needs, starting with life insurance.
In this Fabric by Gerber Life Insurance review, I’ll explain how Fabric’s products are designed to simplify the process of making financial moves most new parents need to make including getting life insurance and creating a will.
Company Name | Fabric |
---|---|
Company Type | Suite of financial tools for new parents |
Key Features | Simplified issue life insurance designed for maximum convenience; free last will and testament creation tool |
Downsides | Age limitations, limited customer service, not the cheapest |
Best For | New parents who would otherwise procrastinate on purchasing coverage |
Fabric isn’t what you throw into the dryer along with your clothes. That’s fabric softener!
This Fabric was founded in 2015 by Adam Erlebacher and Steven Surgnier, who were high-ranking employees at the now-defunct online bank Simple.
Fabric is backed by Western & Southern Life Assurance Company, an insurance company with an A+ AM Best rating.
Money expert Clark Howard says you should filter companies by their AM Best ratings when shopping for insurance. He recommends buying only from companies with A++ ratings, but he says A+ is OK on policy terms of 20 years or less.
Fabric wants to provide a complete financial tool kit for new parents. To that end, its primary product is term life insurance, but it offers a variety of other tools as well.
It’s worth noting that Fabric has changed significantly since we first reviewed the company in July 2018. It continues to create new versions of its current products while developing new ones.
One of the most recent changes is the name. As a newer digital company, Fabric is a life insurance agency rather than an insurance company. It doesn’t issue policies itself. So the company added “by Gerber Life” to reference its roots. Parent company Western & Southern Life started in 1888.
Fabric has decided that convenience is key when appealing to new parents. It has minimized the application and decision-making processes. It also offers “one-stop shopping” for some of the financial services new parents need.
Here are some of the pros when it comes to Fabric life insurance and other products:
You can probably predict most of Fabric’s cons before reading this section. It’s still a relatively new company and is part of the group that’s disrupting the insurance industry.
The downsides typically associated with disruptors are not unique to the insurance industry:
Gender/Age | Policy Amount | 20-Year Term Life |
---|---|---|
Female/35 | $500,000 | $20.72/month |
$1 Million | $34.90/month | |
Male/35 | $500,000 | $23.72/month |
$1 Million | $40.90/month | |
Female/45 | $500,000 | $56.51/month |
$1 Million | $96.82/month | |
Male/45 | $500,000 | $71.00/month |
$1 Million | $125.80/month |
Fabric offers term life insurance policies lasting 10-30 years and coverage amounts from $100,000 to $5 million.
A 35-year-old non-smoking male from Florida in excellent health can get a 20-year instant-issue policy with $500,000 in coverage for $20.72 per month. There are more price quotes I gathered in April 2023 in the table above.
Since the first time I gathered price quotes, the rates have gone down significantly for 35-year-olds and up for 45-year-olds.
A Fabric representative pointed out that the monthly premium for a 45-year-old with a 10-year policy term is almost twice as cheap as for a 20-year term, adding that most 45-year-olds aren’t parents of newborns and probably don’t need 20-year terms.
Fabric requires medical exams for policies of more than $1.5 million in coverage and for people with certain health conditions. But it’s possible to buy simplified issue term life insurance in 10 minutes on the Fabric website or app without a medical exam.
The last time I talked to Fabric, a company representative said it was approving three times more applicants instantly thanks to a beefed-up automated underwriting algorithm. It also gives you a second shot at approval without a medical exam by having a human underwriter review your application. This person will ask you more questions and gather more information and will sometimes ask for documentation.
If you do need a medical exam, it’s free. You can schedule it through Fabric at a time that’s convenient for you, and the company will send medical personnel to your house or workplace.
If you’re healthy, there’s a great chance that you’ll get instant approval as soon as you finish your application. You can buy Fabric life insurance immediately. You can also modify the coverage amount and term length and instantly review the difference in the cost of your monthly premiums.
Fabric did not make our list of the best term life insurance companies.
Fabric believes its efforts to offer a full suite of products to new parents differentiates it from its competitors. I appreciate the sentiment, but the company still has work to do to fully realize that vision. However, the offer of a free last will and testament is commendable.
Here’s what Fabric currently offers beyond term life insurance.
The company also gives you a way to access whole life insurance. You can’t apply for it. But if you meet certain stipulations, you can eventually convert your term life policy to a whole life policy.
Clark thinks term life insurance is better than whole life insurance for almost everyone.
Digital technology disrupted plenty of other major industries before it tackled insurance. And smart people can disagree on whether fast and convenient service is more valuable than the traditional slower approach that offers more human contact.
Whatever philosophy you hold, consider that a pharmaceutical company can create medicine with a 100% cure rate, but if no one will take it, it’s worthless.
Other insurance companies offer more product variety, a longer history, and in some cases, cheaper monthly premiums. But new parents can be busy and stressed, so they may not feel like they have the time to shop for life insurance and related products. Fabric streamlines the process.
This post was last modified on June 8, 2023 3:49 pm
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