Transamerica Scam: Pyramid Scheme or MLM? [Review]

If you’re on the hunt for an online money-making opportunity, chances are you’ve come across Transamerica. Maybe a friend or family member introduced it to you, or maybe you stumbled upon it during your research.

But with all the scams out there, it’s natural to wonder: is Transamerica a pyramid scheme or a legitimate way to make money?

As an online entrepreneur, I’ve reviewed countless online programs like Transamerica. And today, I’m here to share with you what I’ve learned.

First off, let me make it clear that I’m not affiliated with Transamerica in any way. That means I’m not being paid to write this review, and you can trust that I’ll give you an honest and unbiased assessment.

So, without further ado, let’s dive into what Transamerica is all about and whether it’s worth your time and energy. And at the end of this review, I’ll also share with you my top recommendation for making a full-time passive income online.

What is Transamerica?

Transamerica is a US-based company that provides financial products and services, specifically health insurance and life insurance. The company was founded by Hubert Humphrey in 1991, and has since used various methods to sell its products and achieve its financial goals.

One of the methods that Transamerica uses to sell its insurance programs is multi-level marketing (MLM), which allows individuals to earn money by promoting and selling Transamerica insurance products to others. However, the company has had its share of challenges, including fines for its marketing practices. Due to negative associations with these tactics, Transamerica changed its name to World Marketing Alliance.

Additionally, in 1999, Humphrey sold the company to Aegon, and it is now a subsidiary of World Financial Group. Despite its rocky history, Transamerica continues to provide financial products and services to individuals across the United States.

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Transamerica: Products and Services Overview

If you’re looking for both insurance and financial services, Transamerica might be worth checking out. They’ve got a range of insurance policies that cover life and health, including whole life, term life, universal life, variable universal life, accidental death, Medicare supplement, and long-term care. So, whatever your needs might be, there’s likely a policy that can help.

In addition to insurance, Transamerica also offers a selection of annuities and mutual funds. These products can help you grow your wealth over time and achieve your financial goals.

However, it’s worth noting that some people find Transamerica’s policies to be more expensive than similar products from other providers. This isn’t uncommon for multi-level marketing (MLM) companies, which often need to charge higher prices in order to pay their distributors and sales agents.

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How Does Transamerica Work?

If you’re curious about how Transamerica works, let’s break it down for you. Transamerica’s selling strategy is known as “person-to-person,” and it involves a hierarchy of leaders and new members. Essentially, the higher-ups are responsible for recruiting new members to the company.

This person-to-person strategy is similar to a pyramid, with a narrow base at the top and a wide base at the bottom. To work for Transamerica, you’ll need to promote and sell the company’s financial products, general health insurance, and life insurance. Additionally, you’ll likely be encouraged to recruit others to join Transamerica, which helps to expand the network.

If you perform well in selling and recruitment, there’s a chance that you could receive significant prizes, commissions, fees, and rewards. However, it’s essential to understand that Transamerica’s person-to-person selling strategy places a lot of emphasis on expanding its MLM network rather than just selling health and life insurance.

Is Transamerica an MLM?

Yes, Transamerica operates as a multilevel marketing (MLM) company. But first, let’s clarify what an MLM is and how it differs from traditional business models.

An MLM, also known as a direct sales or network marketing company, is a business model where you earn money by recruiting others to join your business, rather than just selling products. In an MLM, you don’t receive a salary. Instead, you earn commissions on the sales and recruits brought in by the people you’ve hired.

Imagine a triangle. If the person at the top recruits ten people, and each of those ten recruits another ten, and so on, you’ll earn commissions from everyone in the triangle. The people below you are your “downline,” and you’re their “upline.” By recruiting more people, you can earn more money, even if you’re not selling products directly.

While most MLMs offer a range of products, many people prefer to recruit others because it can lead to a lifetime of passive income. Those at the top of the MLM structure make more money because the money trickles up to them. Those at the bottom typically make less.

At Transamerica, the goal is to build a large downline to earn significant passive income. By recruiting as many people as possible, Transamerica’s MLM structure allows its employees to earn a lot of money.

You may also want to read our article on the top MLM companies.

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Is Transamerica A Pyramid Scheme?

No, Transamerica is not a pyramid scheme. While pyramid schemes lure people in with promises of quick profits and rewards for recruiting others, Transamerica operates differently.

Pyramid schemes rely solely on the recruitment of new members to generate revenue, but Transamerica sells financial products such as life insurance, retirement plans, and investment services. Members of Transamerica can make money by selling these products, not just by recruiting new members.

Unlike pyramid schemes, Transamerica’s revenue stream comes from actual sales of tangible goods and services, not just from the recruitment of new members. This means that the company has a sustainable business model and is not solely reliant on the constant influx of new recruits to survive.

Furthermore, Transamerica is a reputable financial services company that has been around for over a century. It’s regulated by various government agencies and has a strong track record of providing legitimate financial products and services to its customers.

Watch the short video below to learn more:

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How Much Does It Cost To Join Transamerica?

If you’re interested in selling Transamerica’s products and earning commissions, you can apply to become a Transamerica sales agent. To get started, you’ll need to pay a $100 processing fee. This fee is required to become a Transamerica distributor and start making money.

If you want to take things to the next level and begin recruiting new members, you’ll need to pay an additional $300. This fee will give you access to the tools and resources you need to start building your team.

It’s important to note that Transamerica’s distributors are encouraged to focus on recruiting new members rather than just selling the company’s products. This is because building a strong team is a key part of the business model and can lead to greater success and earning potential.

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Is Transamerica a Scam?

Legally speaking, Transamerica is not a scam. According to the Oxford Living Dictionary, a scam is defined as “a dishonest scheme; a fraud.” However, that doesn’t mean everyone who works with Transamerica makes a lot of money.

In fact, the majority of Transamerica representatives don’t earn any money. While some people do make money, it requires a lot of effort, and usually, it’s through aggressive recruiting tactics. This can leave some people feeling like Transamerica is a scam.

On top of that, Transamerica has been known to make disingenuous and irresponsible marketing claims in order to recruit members. This has only added to the skepticism around the company.

Reasons Why I Don’t Recommend Transamerica

Transamerica is one of the many MLM companies out there that claims to provide a business opportunity to make money. However, there are several issues to Transamerica’s MLM business model that you should be aware of before investing your time and money.

Good Reviews Are Written by Transamerica’s Affiliates

Be cautious of the good reviews you find about Transamerica online, as they may be biased and not trustworthy. Many of these reviews are written by Transamerica’s affiliates who receive a commission for recruiting new members. It’s essential to read reviews from non-affiliates to get an unbiased view.

Very Few People Can Make Money With Transamerica

The statistics show that the majority of MLM members, including Transamerica’s, lose money. The sales quotas required to earn commissions can be challenging to achieve, and many MLM members lose money before even recruiting one person into the company.

Losses From Transamerica Are Reframed as Investments

Transamerica’s uplines often reframe financial losses as ‘investments’ in their business, which is not accurate. The return on investment is negative in most cases, and it’s unlikely you’ll get your money back.

Transamerica Is a Cult

MLMs like Transamerica have a cult-like company culture that discourages critical thinking and isolates members from their family and friends. Leaving an MLM can result in being labeled as a failure or bad influence, leading to devastating losses.

You May Need to Purchase Transamerica Products Yourself

If you don’t have a large network of people to sell to, you may need to buy Transamerica products yourself each month, resulting in a losing proposition in the long run.

Transamerica Products Are Overpriced

Transamerica products are overpriced, making it challenging to sell them when other brands offer similar products at lower prices. This is why most people who join MLMs focus on recruiting instead of selling products.

Transamerica’s MLM Business Model Has a Bad Reputation

MLMs like Transamerica have a reputation for being fundamentally flawed, with commissions skewed towards the top. The majority of members in the top tier and pioneers make the most money, while those at the bottom struggle to break even.

Exaggerated Claims of Income

Transamerica, like any other MLM company, makes exaggerated income claims, but the reality is that very few people make a good living promoting Transamerica. Transamerica’s low retention rate is also discouraging, as less than 41% of its distributors are active.

Recruiting is Required to Succeed

Eight out of ten ways to earn money with Transamerica require recruiting, making it essential to focus on recruiting others to succeed. If you don’t recruit, you are destined to lose money.

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Pros and Cons of Joining Transamerica

Looking to join Transamerica? Here are some things to consider before making a decision.


  • One of the great things about Transamerica is their customer service. They have an amazing team who are available 24/7 to help you with any queries you might have. Simply get in touch with them via phone or email, and they’ll be happy to assist you.


  • While the job openings are advertised as upper-level management positions with a fixed salary, it’s important to note that they’re primarily sales positions. If you’re looking to join Transamerica, make sure you’re comfortable with the idea of working in a sales-oriented role.
  • If you want to make money with Transamerica, you’ll have to focus on recruiting your friends and family to join as sales agents. This can be a challenging task, so be prepared for the hard work that comes with it.
  • It’s worth noting that Transamerica is not a Better Business Bureau (BBB) member. While this doesn’t necessarily mean they’re a bad company, it does mean they’re not held to the same standards as other businesses who are members.
  • Finally, according to, Transamerica was forced to pay $195 million to settle a lawsuit over universal life insurance. The company increased the monthly payment on over 70,000 universal life insurance policies without providing a reason for the change. This is something to keep in mind when considering Transamerica as an insurance provider.

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Final Verdict

If you’re thinking about joining Transamerica to make some cash, I wouldn’t recommend it. It can be tough to get started when you’re trying to find recruiters to join your Transamerica commission, and even worse, you may end up asking your friends and family to join your Transamerica business opportunity. Not exactly a fun way to make a living.

And if that wasn’t bad enough, your upline will keep reminding you to buy more Business Support Material, even if you’re struggling to get people to join your downline. The reality is that you’re likely to lose more money than you make. In fact, 99% of people who join MLMs break even or lose money, according to a study on the FTC’s website.

Joining an MLM-type business can put you under a lot of pressure to succeed, which is why many people end up leaving. So, why not start your own online business instead? You’ll have the flexibility to choose what you want to promote and won’t have someone telling you what you have to sell.

In the next section, I’ll tell you how to build a legit online business that can earn you a passive income. This is what I’ve been doing for a year now, and I’m making a full-time income from it. Plus, it’s 100% legit and sustainable, unlike MLM models. So, let’s get started!

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Is There a Better Way to Make Money Online?

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You may read our article about the difference between MLM and affiliate marketing.

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