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Guaranteed life insurance guide

Fact-checked with HomeInsurance.com

As you get older, having a life insurance policy can help you prepare for big expenses associated with the event of your death, such as funeral costs. But getting approved for life insurance can be difficult if you’re past a certain age, or have pre-existing health conditions. If you fall into either category, it doesn’t mean you have to go without coverage. Some types of insurance, like guaranteed life insurance, were created to cover individuals who don’t qualify for standard life insurance. 

What is guaranteed life insurance?

Guaranteed life insurance is a type of life insurance policy that does not require a medical exam or health screening. It’s also called guaranteed issue life insurance, or burial insurance. Because there’s no medical exam, almost anyone can get approved for coverage, regardless of their health or medical history. 

Besides the absence of the medical exam, there are a few things that make guaranteed life insurance different from other policies. There is a death benefit, but it’s very low. Most insurance companies cap the death benefit at $25,000. Because of that, guaranteed life insurance is best used to cover end-of-life expenses and fulfill outstanding debts. 

Unlike other types of permanent life insurance, guaranteed life insurance does not have a cash value component. You pay the monthly premium to keep your policy in force, and in return, the insurance company promises to give your beneficiaries a death benefit after you pass away. 

In order for your beneficiaries to get the death benefit, some insurance companies require you to have coverage for at least two years. If you die before the two year period, your beneficiaries will receive the money that you’ve paid in premiums. With guaranteed life insurance, you also have the option to name a funeral home as your beneficiary, so all the money goes directly towards covering your funeral expenses. 

How to get guaranteed life insurance

Getting guaranteed life insurance is very fast and easy. Unlike traditional life insurance, you don’t have to complete a lengthy health questionnaire or get a medical exam in-person. Here are the steps you should take to get guaranteed life insurance:

  • Find providers: Start by shopping around for a few providers that sell guaranteed life insurance. Not all companies offer it, but a few examples of providers that do are Gerber Life, AIG Direct and AAA Life.
  • Apply for a quote: Most insurance companies allow you to apply for guaranteed life insurance online. You’ll just need to submit your state, age and gender. 
  • Compare rates: Once you have a few quotes, compare them to see which company can give you the best rate for the coverage you’re looking for.
  • Sign a policy: After you decide on a provider, it’s time to sign a policy. You can probably purchase a policy online, but you can also choose to work with an agent. 

Who needs a guaranteed life insurance policy?

Guaranteed life insurance can be an enticing option, especially because it’s so easy to get coverage. However, not everyone needs guaranteed life insurance. It’s the best option for seniors who can’t qualify for any other type of coverage due to certain health issues.

You also have to be eligible for guaranteed life insurance if you’re considering this option. Typically, it’s only available to individuals between 40 and 85 years old. The exact age range varies by company, but it’s safe to assume you won’t qualify if you’re as young as 25, or as old as 95. 

Pros and cons of guaranteed life insurance

ProsCons
Almost everyone is approved for coverageVery low death benefit
No medical exam or health questionnaireExpensive premiums
Easy to get coverage onlineMust qualify based on your age
Covers end-of-life costsNo cash value component

How much does guaranteed life insurance cost?

One of the downsides of guaranteed life insurance is that it’s very expensive for the amount of coverage you get. According to True Blue Life Insurance, the cost of guaranteed life insurance can range from around $100 to $120 per month. 

However, your state, gender and age are all factored into the cost of your premium, so your quote may differ from that range. Men typically pay more for guaranteed life insurance because they have a shorter life expectancy than women. Additionally, older people pay less for their insurance than younger people.

What’s the difference between simplified whole and guaranteed life insurance?

If you’re struggling to get standard life insurance coverage, you can also look into simplified whole life insurance. Simplified whole life insurance is similar to guaranteed life insurance, but there are few key differences.

Simplified whole life insurance is a good option for individuals who have moderate health risks. This type of policy does require a medical questionnaire, but you can still get accepted if you have some health issues. There’s no in-person medical exam for simplified whole life insurance.

Guaranteed life insuranceSimplified whole life insurance
Usually have to be at least 40 to applyCan get coverage as young as 18
No medical questionnaire or exam requiredMedical questionnaire is required
Very expensive premiumsCheaper premiums than guaranteed issue
No cash valueNo cash value
Death benefit cap is around $25,000Death benefit cap is around $50,000

The takeaway

  • Guaranteed life insurance is for people who don’t qualify for standard coverage
  • There is no medical exam or health questionnaire required
  • It offers very little coverage, and has a very high premium

If your health issues are making it difficult to get standard life insurance coverage, applying for a guaranteed life insurance policy is a good last-resort option. It will help you pay for end-of-life expenses, and cover unpaid debts so your family doesn’t become financially responsible. However, keep in mind that guaranteed life insurance is much more expensive, and you get very little coverage for the amount you pay.

Elizabeth Rivelli

Elizabeth is an insurance writer for coverage.com, where she covers insurance providers and reviews policies to help consumers find comprehensive and affordable coverage for every area of their life. She has more than three years of writing experience for top online insurance and finance publications.

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