Because life insurance is such an important investment, it’s vital that everyone has the coverage that they deserve. There are a lot of people that get declined for life insurance, and they assume that they can’t get life insurance. That couldn’t be further from the truth.
What is Guaranteed Issue Life Insurance?
Just as its name suggests, guaranteed issue life insurance is a type of coverage that can be purchased – regardless of your health or medical condition. With this insurance protection, you cannot be turned down or declined.
In many cases, guaranteed issue life insurance is a form of permanent life insurance protection known as whole life. This means that the policy will offer a death benefit, as well as cash value build up. The cash that is in the cash-value component of the policy is allowed to grow on a tax-deferred basis – and, these funds may be borrowed by the policyholder.
These funds can be used for anything that you require – such as assistance with paying off debts, supplementing your retirement income, or even for taking a nice vacation. It is important to keep in mind, though, that any amount of cash value that is not repaid will count against the death benefit proceeds that are paid out to the beneficiary.
With a whole life insurance policy, you will also be able to keep your coverage for life – provided that the premium continues to be paid. Typically, the amount of the premium that is due will remain the same, guaranteed, throughout the life of the policy.
Often, due to the added risk that the insurance company is taking on, the face amount that is offered on guaranteed issue life insurance may be lower than that of a regular life insurance policy. However, this option can provide you and your loved ones with the peace of mind in knowing that coverage is there.
As with other types of life insurance, a guaranteed issue life insurance policy will pay out a benefit to a named beneficiary – and these proceeds are received free of income taxation by the recipient.
Because there are no medical exams or other health underwriting to contend with, a guaranteed issue life insurance policy can often be approved and put in force much more quickly than a medically underwritten plan. In fact, in some instances, guarantee issue coverage can be approved and issued on the same day that a person applies. With a traditional life insurance policy that requires a medical exam, you’re going to have to wait a month or more to get life insurance coverage. If you want to get life insurance as quickly as possible, then a guaranteed issue insurance plan is going to be the best option.
Who Should Consider a Guarantee Issue Life Insurance Policy?
There are several cases where a person may be a good candidate for a guaranteed issue life insurance policy. First, those who have certain health conditions such as cancer or someone needing life insurance after a heart attack – and who may not otherwise qualify for traditional coverage – may want to consider going the route of a guaranteed issue policy.
Also, because there is no requirement to provide the insurance company with a blood and urine sample, those who have an intense fear of needles could also be a good candidate for guaranteed issue life insurance.
What to Look for In a Guarantee Issue Life Insurance Plan
When shopping for guaranteed issue life insurance coverage, there are several factors that will be important to consider. One of these is the way in which the policy will pay out it death benefits.
Because those who purchase guaranteed issue life insurance are typically considered to be riskier to the insurance carrier, the death benefits is not always fully available if death occurs within the first two years.
The lower amount of proceeds may be a percentage of the stated death benefit, or the beneficiary may just simply receive back the amount of premium that was paid into the policy (plus, in some cases, a small amount of additional interest).
It is also important to review the financial strength and stability of the offering insurance company. This is so that you can be more assured that the company will make good on its promise to pay the death benefit proceeds when that time comes.
Also, comparing the premiums of several different guarantee issue life insurance policies can help you to determine the best possible price for the coverage. Many people may not realize that life insurance policies – just like any other product or service that you might buy – are not all priced in an identical manner, even for the very same type and amount of coverage.
Disadvantages of Guaranteed Life Insurance
When you’re shopping for life insurance, it’s important that you compare all of the different plans available. There are several types of plans that you can choose from. With guaranteed life insurance policies, there are several drawbacks that you should be aware of when shopping for protection.
The main disadvantage of these guaranteed life insurance plans is that they are going to be expensive. Without the health information or medical exam, the insurance company doesn’t know how much of a risk that you are for life insurance, which means that they are taking more risk to get you a plan. They are going to offset that by charging you higher premiums. You’re going to pay much more for every dollar of insurance coverage versus what you would for a plan with a medical exam. If you want to get the most affordable life insurance coverage, then you need to apply for a plan that has a medical exam.
The other downside is that you will be limited on how much face value you can purchase. Typically the limit is $25,000 and for families who need more coverage this isn’t ideal.
Where to Find the Best Rates on Guarantee Issue Coverage
Unlike traditional insurance agents, we are a group of independent brokers, which means that we don’t work with one single company. Instead, we represent dozens of highly rated companies across the nation and we can bring all of the best rates directly to you.
Every insurance company is different, and all of them are going to give you different rates depending on the rating system. Because guaranteed issue life insurance plans don’t get any information on your health, the rates that you get could vary drastically depending on the company that you contact. You could spend hours and hours on the phone calling different companies to receive rates about their guaranteed issue plans. Instead, let one of our independent insurance agents do all of that legwork for you. We can save you both time and money on your life insurance coverage.
Getting the life insurance coverage that you need shouldn’t be difficult – and we can help to make that process much easier and faster through our database of insurance carriers and premium quotes. Now, when it comes to the purchase of life insurance coverage, you have an ally on your side. So, contact us today – we’re here to help.