Guaranteed Issue Life Insurance

Life insurance is a necessity for those who want to protect their loved ones from the burden of paying for unexpected expenses during their time of grief.

Of course, not everyone can afford the coverage they want, and not everyone is allowed to pay for the coverage they need because of preexisting medical conditions. In these cases, there is guaranteed life insurance policies.

What is a Guaranteed Issue Life Insurance Policy?

A guaranteed life insurance policy is designed to give you budget based and secure protection for you and your family. Regardless of health, you will not be turned down and therefore you can get coverage that is budget-friendly in premiums and leave behind a legacy of peace of mind rather than debt.

There are plenty of companies which offer a guaranteed whole life insurance policy. This falls under the same category as any other whole life insurance policy but the difference is you do not have to undergo any type of medical exam and you will not be denied coverage no matter what.

In exchange for not undergoing that medical exam and theoretically being a higher risk to the life insurance company, you are charged higher premiums.

Guaranteed Issue Life Insurance Rates

Let’s look at some samples for male and female policies based on age:

Age $5,000 Male $5,000 Female $10,000 Male $10,000 Female $25,000 Male $25,000 Female
45 $14 $13 $26 $23 $58 $52
50 $16 $14 $29 $26 $69 $58
55 $19 $17 $35 $29 $85 $67
60 $23 $18 $43 $34 $102 $80
65 $29 $23 $56 $42 $133 $100
70 $39 $29 $73 $55 $176 $129
75 $52 $39 $100 $73 $244 $176
80 $71 $54 $139 $100 $340 $255
85 $100 $72 $200 $142 $496 $351

What About Level Guaranteed Policies?

That said, most of the time the policies you find under guaranteed issue life insurance have level premiums which means that once you select your policy your premium stays the same for the rest of your life.

As long as you pay your premiums on time every month or every year your coverage will not be decreased, and your premiums will not be increased.

Whole Life Insurance

In certain situations, with specific life insurance companies you can find a guaranteed whole life insurance which accumulates similar to other whole life insurance policies.

This means that you have the opportunity to build a small amount of cash value which you can borrow against or apply to your premiums, or even take out as a cash benefit to be spent how you see fit.

With these simple policies you can also take out a loan against the total death benefit and if that loan plus interest is not repaid at the time of your passing it will simply be deducted from your total death benefit.

Burial or Final Expense

Guaranteed issue life insurance can be a burial or final expense based as well. Guaranteed issue burial insurance affords your beneficiaries a death benefit to cover only the expenses of your burial.

By comparison, a guaranteed issue final expense Insurance gets your beneficiaries money that they can use for your final arrangements, any ongoing expenses, unpaid medical bills, or any outstanding debt.

There is a great deal of flexibility with how you make your payments. You can choose to pay annually, semi-annually, quarterly, or monthly. Paying annually does typically bring with it a small percentage of savings.

Graded Death Benefits

With the guaranteed issue policy there will always be a two-year graded death benefit.

This means that if you pass away within the first two years of having your policy, your beneficiaries receive all of the premiums you have paid to date plus interest, typically 10% interest.

After the first two years your beneficiaries become entitled to the whole death benefit.

Who Needs a Guarantee Acceptance Life Insurance Policy?

There are plenty of people who need a guaranteed policy.  While many life insurance companies offer flexible term policies and burial insurance policies, and a litany of permanent policies, they also have automatic denial of coverage if you answer yes two different health questions.

Be specific questions that each company asks might vary slightly. State Farm, for example, has more stringent underwriting and therefore a longer list of questions that you have to answer whereas AIG has a similar underwriting requirement and a substantial list but not necessarily as large as State Farm.

In any case, if you answer yes to any of these questions you will be automatically denied coverage of any kind. In many cases if you have ever been denied because of answering yes to any of these questions, even if things have changed now, you will still be denied another policy. Some examples of these questions include the following:

  • Are you currently receiving Home Health Care?
  • Are you currently in a hospital or nursing facility?
  • Do you currently require assistance with your daily activities for daily living such as eating, bathing, or using the restroom?
  • Are you currently using oxygen to breathe?
  • Are you currently confined to a wheelchair?
  • Have you ever had or been treated for Alzheimer’s or dementia?
  • Have you ever had or been treated for Lou Gehrig’s Disease?
  • Within the last three years have you had or been treated for cancer?
  • Have you ever been put on dialysis?
  • Have you ever had an organ or tissue transplant?
  • Have you ever had or been treated for muscular dystrophy?
  • Within the last three years have you had or been treated for COPD?
  • Have you ever had or been treated for Hepatitis A, B, or C?
  • Have you ever had or been treated for Parkinson’s Disease?
  • Within the last three years have you had her been treated for alcohol or drug use?
  • Within the last three years have you had or been treated for kidney disease?
  • Have you ever had or been treated for Huntington’s disease?
  • Have you ever had or been treated for multiple sclerosis?
  • Within the last three years have you had or been treated for a heart or circulatory procedures such as a balloon procedure, angioplasty, or stent placement?
  • Have you ever had or been treated for AIDS or HIV?
  • Within the last three years have you had or been treated for a mental or nervous disorder like schizophrenia?
  • Within the last three years have you ever had or been treated for issues of your heart or your circulatory system, including aneurysms, heart attacks, congestive heart failure, or chest pain?
  • Within the last three years have you had or been treated for a stroke or a mini-stroke?

This is a pretty substantial list.  Anyone who has suffered from any serious medical condition stands to benefit from not having to disclose this when applying for life insurance.

Normally people think of pre-existing conditions or tobacco use has something that will simply increase prices. Tobacco users tend to pay almost twice as much as non-tobacco users. And of course, there are different levels to the premium to pay.

You might be put into the standard level or standard class but within the standard class, there are a handful of sublevels. Most insurance companies use a letter system or a number system, so you might get a standard premium at level B.

For each sub-level, you have to pay 25% of the standard premium on top of your standard premium. So, if you are placed at level B that means you are paying 50% of the level premium on top of the standard rate.

Financially this can get out of hand very quickly especially if you are put at a very low level and you end up paying twice as much. But what most people fail to realize is that certain health condition or previous health conditions might not land you in a lower, more expensive class but might simply because for denial of coverage.

For people like this, a guaranteed-issue policy is the only option. Without it, their loved ones would be left with the financial burden of covering final expenses, burials, even left behind medical bills or debt.

Best Guaranteed Life Insurance Policies 

When deciding upon a company for guaranteed issue life insurance, you want to take into consideration specifically what you are going to need in the present and what your family is going to need when you pass away.

Company A.M. Best Rating Customer Reviews
AARP A+ 4.0 / 5
AIG A+ 4.2 / 5.0
Gerber A 4.1 / 5.0
Mutual of Omaha A+ 4.1 / 5.0

Each of these companies offers their own guaranteed issue life insurance policies that stick out above the herd for their affordability, coverage amounts, and policy riders.

Policy Riders

Some companies have innovative features built into the policies for free such as a chronic illness feature or a terminal illness feature. In these instances, if you get sick with a qualifying chronic illness and you need to access part of your policy benefits early to pay for this, you can do so at no additional cost.

If you become terminally ill and you have, less than 12 months to live and you need to access some of the policy benefits you can typically get up to 50% of your death benefit with this feature. These features are designed to help you pay for medical expenses or supplement your income, with the remaining amount still given to your beneficiaries at the time of your passing.

Which Type of Life Insurance is Best for You?

It is important to consider a different company based on which features they have. Some companies might charge you extra for these features, but others do it as part of the policy. Of course, just because something is included for free as part of your policy does not mean it is cheaper.

Life insurance companies might simply build in the cost of including these purportedly free features into the higher premiums.  If you have significant savings and you simply want the guaranteed burial insurance, you might not be as worried about these features and therefore can pick a much cheaper policy.

By comparison, you might need a whole life insurance policy that builds cash value so that you can spend it now and supplement your retirement income. You might instead need a higher face amount then your ideal company is offering. For this reason and many more, you should work with a third party broker to help you compare different offerings.

Finding the Best Life Insurance for You

When it comes to finding the best guaranteed issue life insurance policy for you, you want to make sure that you compare rates from multiple companies.

Online tools have made this easier than ever before, but even then, you should take the time to speak with an independent life insurance agent who can help you compare the best guaranteed issue life insurance companies for you and your family’s needs.

Give us a call today to speak with one of our agents, or get started online with our online quoting engine for quick and easy guaranteed issue life insurance quotes.

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