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Is Primerica a Pyramid Scheme?

Were you victimized by Primerica? Tell us about your experience.

Before answering the question “Is Primerica a Pyramid Scheme,” make sure you understand the difference between an MLM and a Pyramid Scheme.

Have you had dealings with Primerica? Maybe they haven’t refunded you when they said they would, or they overcharged your account? Perhaps you’re simply having an issue with their customer service. Now you’re wondering if maybe they are a bad company, or a pyramid scheme scheme. Rest assured you are not the first. It can be difficult to tell when a company is a pyramid scheme and when they’re not.

What is Primerica?

Primerica is a very old company that for over 40 years has been selling insurance and financial products by way of the network marketing model. They offer insurance, investments, debt consolidation, and financial advisers. They focus heavily on helping the middle class with financial products. In fact, they are well-known for offering insurance to people who might otherwise not qualify for life insurance, such as those with pre-existing health conditions. 

Primerica Allegations and Lawsuits

They did face a collection of 238 lawsuits in Florida from public servants in 2014 and settled for $15.4 million. 

Another case was brought to the court by Miriam Arellano. She sued Primerica in 2014 after she met with a representative to get life insurance for her husband twice, filled out the application and the medical questionnaire, and was told that they qualified for a life insurance policy worth $100,000. Arellano Decided she was having second thoughts because the premium was too high but after subsequent meetings they increase the coverage to $150,000 for just a slightly higher premium which was agreed to but, there were mistakes made on the application and the policy never went into effect and during this confusion, the application was canceled and Mr. Arellano passed away suddenly. Primerica denied the claim for death benefits because no policy had been in effect. She sued them for breach of contract and bad faith. The jury found in favor of Arellano and Primerica had to pay a settlement which came down to $40,000.

They have an A+ rating according to the Better Business Bureau and they have been in business for 43 years and accredited since 1980 with just over one hundred total complaints over the course of the last 3 years mostly to do with the products they sell and the billing. Some examples include a failure to transfer direct deposit information which caused a cancellation of an insurance policy, a delayed refund on an insurance policy, or an issue getting mutual funds released in a timely fashion.

Why is Primerica Not Considered a Pyramid Scheme? 

Primerica is an MLM company but they are not a pyramid scheme. They have legitimate financial products and they do ask that you recruit a team below you in order to sell more of these products, but the emphasis is on the products. A pyramid scheme doesn’t care about selling the products and they only care about recruitment. With this company, having been around for decades, they focus on really meeting the needs of high-risk individuals who might not have any other options. 

Their sales representatives are not allowed to sell insurance or securities without a license so they do require that anyone who works as a representative pass an actual licensing exam and that makes them significantly more legitimate than most other companies.

They are pretty upfront about the potential of their representatives who earn an average of $6,000 per year for the work they do but as is the case with most MLM companies the majority of representatives pay the company the sign up fee and then don’t make a profit because they don’t do anything with it. 

What can I do?

If you have dealt with this company either as a consumer or a distributor and you have a complaint that they aren’t paying any attention to or they simply haven’t fixed, rest assured you still have options including consumer arbitration.  We can help.








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