Primerica Review (2022): Scam or Legit?

If you’re reading this, it’s probably because you’ve been approached to either become a Primerica agent or to purchase their products.

You might have heard from friends or colleagues to avoid Primerica for several reasons.

I used to work in the finance industry for over a decade, and Primerica didn’t have a great reputation amongst its peers.

But Primerica has been in business for nearly 50 years and is a significant force in the insurance game, especially in the United States. With over 150,000 employees and a $5 billion market cap, it’s a huge company.

Despite the company’s reputation, there’s no denying the fact that it’s a huge global force and one that requires close examination. Let’s go over this Primerica review to see if it is a scam or legit.

Our Verdict
Primerica Review
4/10Our Score

Primerica

MLM insurance and investment products

A company that provides insurance and investment products using an MLM method of recruiting advisors and getting customers.

Pros
  • Flexible schedule as a representative
  • Potential to make a good income
  • A large company with vast resources
  • Some report a positive working environment
Cons
  • MLM strategy is seen as a pyramid scheme by many and
  • A tough objection to overcome when trying to close sales or recruit
  • Potentially lots of pressure to recruit and sell products
  • Potential damage to existing relationships while trying to sell or recruit.
  • No guaranteed income or consistent salary
  • Could potentially be a conflict of interest to sell you products that may not suit your needs in hopes of making a commission.
  • Some report a negative working environment.

What is Primerica?

Primerica Inc. is an organization that provides investment, insurance, and financial services to middle-income families in Canada, the United States, Puerto Rico, and Guam. They have been publicly traded on the New York stock exchange since 1989 under the name “PRI,” and their parent company roots back to the early ’80s.

Primerica owns various subsidiaries such as National Benefit Life Insurance Company, Primerica Life, Peach Re, Vidalia Re, and e-Telequote.

Is Primerica a Pyramid Scheme or Scam?

No, Primerica is not a pyramid scheme. Pyramid schemes are illegal, and Primerica’s operations are entirely legal.

The company has been publicly traded on the New York Stock Exchange for decades and are regulated by national governing bodies in the respective countries that they operate.

But the controversy lies in how Primerica operates similar to a multi-level marketing (MLM) company.

Although they do not use this terminology to describe themselves (specifically the MLM part), they heavily rely on the recruitment of newly licensed individuals to not only sell their products but also to recruit more and more representatives, growing their reach.

My research shows that the recruited representatives operate within an 11-tier system in which sellers make commissions all the way up to their 11th recruitee removed.

Although it’s a perfectly legal way to structure your business, MLM’s have always gotten a lot of hate. Combine that with the fact that you’re selling something as important as financial products, and it’s a recipe for controversy.

How Much Money Can You Make at Primerica?

In short, yes, you can really make money with Primerica. But it won’t be a walk in the park like some existing reps might have you believe, and you certainly won’t get rich quickly.

Reports put out by the company suggest that licensed professionals make about USD $5,000-$7,000 per year on average, which is somewhere between $415 and $583 per month. This amount is certainly not enough to live on, especially if you commit all your work hours to this activity.

Better Pay Elsewhere?

In addition, the starting commission structure at Primerica is way below the industry standards that I’ve seen. For example, for insurance, Primerica agents get paid around 25-30% First Year Commission (FYC) on the products they sell when they start.

When these representatives hit specific production and recruiting targets, they will have the chance to make higher commissions. Until then, they are in fight or flight mode.

For comparison, many life insurance brokers initially start at higher contracts at other companies, which was the case for me. I started out at an 80% FYC contract level. My contract level went up to 140% FYC within less than two years.

In my opinion, the starting 25-30% FYC contract level at Primerica is too low.  

The success stories of reps making hundreds of thousands of dollars per year are outliers and probably even skew the statistics. Because Primerica agents work purely on a commission basis, it is impossible to know precisely how much money you would make per hour worked, and it will be wildly different per person.

No Guaranteed Of Income

As with all other MLMs, your success is not necessarily correlated to how hard you work.

Without selling products or recruiting a vast network of agents, it is possible to make absolutely nothing with this company.

Without a salary, you may be left feeling quite desperate, which may be one reason the company does not have the best reputation.

A higher success rate of making money with this company seems to be through recruiting instead of trying to make sales. In fact, this is encouraged heavily by the corporate staff.

Why Does Primerica Have a Bad Reputation?

Some people believe Primerica to be amazing, and others avoid it strongly and have negative opinions about it, mainly because of these reasons:

1) MLM business model

This method of conducting business, that is, paying representatives commission rather than a salary and putting a high emphasis on sales and recruitment, usually results in ambitious individuals going the extra mile to persuade people.

Naturally, we tend to be wary of people who have a vested financial interest in us purchasing something or joining a company.

2) Prospecting Friends and Family

Another reason why Primerica may have a negative reputation may be because the company encourages its licensed representatives to prospect their “warm market.”

MLM representatives tend to do this anyways, pitching to their family, friends, and colleagues, but Primerica reps may have an even greater emphasis on such a technique.

Warm pitching (i.e. pitching to people you already know) is tricky. In efforts to climb within the company and make more money, you may risk damaging your reputation or even your personal relationships.

I’ve been on the other end of such an exchange before (i.e. being the one pitched to), and I find it uncomfortable and awkward. In a sense, it feels like the relationship is being taken advantage of in pursuit of the other person’s economic interests, and that never feels good.

3) Negative Reviews

The last reason why Primerica does not have a good reputation may be because of some of the reviews of current or previous Primerica representatives.

Whether they did not enjoy the working culture, the pay, or the company’s values, some speak very negatively about the company, which certainly does not help Primerica’s reputation.

Should you become a Primerica Representative?

Let’s go through company culture, training, and other relevant pieces of information that may inform your decision about whether you should become a Primerica rep.

Getting Started at Primerica: Fees and Schedule

Becoming a licensed professional through Primerica is referred to as a “business opportunity” by the company, and it even has a dedicated website.

Here is how it would work when you become a Primerica rep: once you decide that you would like to become a licensed representative and obtain your insurance license (my research shows that this costs about $99 and is not covered by the company) your time and efforts are up to you completely.

As a Primerica rep, you have freedom over your schedule. You can choose to work full or part-time and when to work and how. Because the pay structure is purely on a commission basis, the more you sell and the more people you recruit to do the same, the more money you will make, and the company leaves this in your hands.

To make money, then, it will be your responsibility to generate leads for both of these goals. Unfortunately, my research into people’s Primerica experiences showed that you are not given many resources and training for lead generation.

Pitching to Friends and Family

Instead, Primerica encourages you to pitch to your “warm market,” which represents people you already know and are in your sphere of influence.

Once you’re trained, you would likely be consistently pitching products to friends and family while trying to recruit more people into the organization. This isn’t completely necessary but highly encouraged.

And here is the secret sauce to Primerica’s success. It’s by using their representative warm leads as a sales tactic.

Working culture

Many employees will point to the pros of flexibility and freedom that come with being a licensed representative, and some speak about the business’s pressure and “cult-like” feeling.

I would recommend taking everything with a grain of salt and doing extensive research by choosing resources that are not biased or affiliated with the company before deciding whether it’s right for you.

In short, I would say that you would have a lot at stake for landing new clients and recruiting new reps while working in a culture that may or may not be a fit for you.

However, if you’re up for this challenge, are comfortable with pitching to your “warm market,” and feel aligned with Primerica’s values, you should consider joining. Otherwise, your time and skills might be better suited for pursuits with more stable income streams.

Should you become a Primerica Client?

Let’s take a look at the products Primerica offers:

Primerica Client Experience/Products

The first thing that would happen when you get linked with a Primerica licensed representative in your area is a Financial Needs Analysis (FNA).

This service is complimentary and allows the rep to understand which products would suit you. The service is structured around providing financial literacy for the client, though it is also a way for the agent to scope out opportunities.

A wide range of products is available for a licensed rep to sell: term life insurance, investments (mutual funds, managed investments, annuities, and business retirement plans), debt solutions, auto & home, pre-paid legal, and identity theft.

Life Insurance Breakdown at Primerica

Let’s look into their primary product, term life insurance. Note that Primerica only offers term life insurance, not whole or universal policies.

This product differs because, unlike most insurance policies, it is not possible to get an online quote before speaking with a rep. You must speak with an agent to find out pricing and product details, which is not ideal or transparent.

Because their website is unclear about product details and prices, it isn’t easy to understand their offerings. Right off the bat, this leaves a sour taste in my mouth.

If I were on the market for something as important as life insurance, I would like to map out my options on my own before taking the time to book an appointment with an agent that I know has commissions on the line.

Furthermore, my research shows that Primerica’s life insurance prices could be higher than traditional providers in many cases

Either way, please make sure that you conduct thorough research and compare alternatives and prices before signing contracts, as you should with any other financial product.

Alternatives to Primerica

If you’re a go-getter with big ambitions to get trained quickly, successfully pitch to a vast number of new representatives, and train them, then, yes, it is possible to make good money with Primerica. But why not try something else that doesn’t have so much controversy around this?

I strongly suspect that most people who join financial MLM companies like Primerica as advisors aren’t that passionate about investing and insurance, and definitely not sales. Instead, they’re just looking for a way to make some money on the side or at home.

If that’s the case for you, why not try the following things below:

Build a Skill

You can learn something like how to code, become a virtual assistant, writer, or proofreader, or brush up on design skills, then freelance your services to clients. The possibilities are endless. Check out lists like these for ideas:

  1. Ultimate Guide to Making Money Online: 99 Ideas
  2. 25 Authentic Work From Home Jobs – No Degree Needed

Employee

Instead of working at Primerica, you can get licensed on your own to sell investment and insurance products, and start working for an insurance or investment brokerage.

I mentioned before that I worked for an insurance broker in Canada that had way higher commission payouts than Primerica has. You will also get trained up at these brokerages. Check your local area for other brokerages you can possibly start working at.

Customer

As a customer, there are countless other options for you other than Primerica:

For Investors

If you’d like to become a do-it-yourself (DIY) investor, sign up for an online broker and learn how to invest on your own. Here are my top picks on the best trading platforms in Canada.

If you need a little bit of advice, you can look at my top picks for the best robo-advisors in Canada.

For Insurance

For Canadian life insurance, I would recommend PolicyMe. They’ve recently created their own products and offer them at very competitive rates. Check out PolicyMe’s website for some free quotes.

Another life insurance option for Canadians is PolicyAdvisor. You can compare 20 different insurers very quickly and get the best rates. Check out PolicyAdvisor’s website for a quick comparison of 20 companies.

Finding an Advisor

If you must use an advisor, try to find a fee-based advisor that is not incentivized to push you towards a certain product. They can help you with both investments and insurance. Do a search for a “fee-based financial advisor” in your area. Try to find one with a Certified Financial Planning (CFP) designation.

Conclusion

Primerica is certainly not a scam.

The way that the company operates is perfectly legitimate and legal, though it could be that working for them or buying their products may not necessarily be right for you.

Although there are many horror stories of bad advisors at Primerica, I’m sure that there are great advisors as well.

It’s not my intention to paint all Primerica advisors with the same brush, but rather shine a light on MLM sales tactics that I really do not personally like or think is an excellent path to success.

There are a handful of multi-level marketing organizations that specialize in financial products. Here are full reviews on similar companies, such as Greatway Financial and World Financial Group (WFG).

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Author Bio - Christopher Liew is a CFA Charterholder with 11 years of finance experience and the creator of Wealthawesome.com. Read about how he quit his 6-figure salary career to travel the world here.

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