The concept behind a guaranteed life insurance policy is the ability to secure life insurance coverage is a way to get insurance without having to go through long applications and medical exams or you have been declined for medical reasons.
Most guaranteed life insurance require your age, gender, your resident state, and if you use tobacco. It is a quick and easy process to apply. In most cases it’s a 10 minute phone call that is required on your part. You are typically approved within 48 hours. It’s an easy process, but that typically comes at a cost.
Guaranteed life insurance plans are called guaranteed because you will not be declined for not passing a medical exam, for smoking, or your health history. This is due to your medical history not being a factor in the underwriting process. Some companies may only require you to answer six or seven questions.
You could even apply without having to go through thorough medical exams such as bloodwork, urinalysis or other invasive screenings. You can even get coverage within a couple of hours from some carriers.
This may seem far-fetched. The drawbacks to escaping most of the life insurance underwriting hassle is the cost will likely be much higher and you could be limited on your coverage amount.
Typically guaranteed life insurance plans will limit your coverage amount. Each company varies and might only be able to cover you up to $10,000 if you are in a higher age bracket. Companies typically allow for issue ages from 50 to 85 years old. The age bracket can change depending on what company you apply with and just how much coverage you’re looking to purchase.
The plan is structured to be a permanent insurance, similar to whole life insurance. This translates to you having a level death benefit as long as you hold the policy and the premium will be level as well. Unlike a whole life policy there are some guidelines on a pay out depending on how long you had the policy prior to your passing, if you passed away within the first two years due to an illness the insurance carrier will we find that 100% of your premiums paid plus a 10 to 12% interest on top of those premiums paid. If he passed away from an accident a full payment of your policy will be paid to your beneficiary tax free. This is how companies can leverage their risk when someone knows they are terminal. Good example is getting life insurance after you’ve been diagnosed with a terminal illness.
Guaranteed life insurance goes by other names such as final expense plans, guaranteed acceptance, and very life insurance plans. They go by different names but the characteristics of guaranteed issue life insurance will include the following:
* permanent coverage
* guaranteed acceptance
* possible waiting periods
* reduced face amounts
* no medical questions
* level premiums
The main characteristic between guaranteed issue life insurance and traditional life insurance is there are no medical questions and no exam required with guaranteed issue life insurance. Do not confuse guaranteed life insurance with no medical life insurance. No medical life insurance does not require a medical exam but it does require that you answer medical questions.
Guaranteed acceptance means exactly what it says. You will not be turned down for coverage if you fall within the insurance company guidelines of age and the amount desired.
A very nice feature of guaranteed acceptance life insurance is the level premiums. This can help you budget your current and future bills. These will never change regardless of what happens in the future or any changes should arise in your health.