When shopping for life insurance, there are many factors that are important to keep in mind. For most people, the type and the amount of coverage will be primary considerations in the life insurance buying process. This is because you want to ensure that those you love and care about will have enough financial protection to go on.
One of the most important criteria that a life insurance company will look at when considering a person’s application for coverage is their health and health history. If you are in relatively good health, then your chances of being approved for the coverage that you need are likely good. If, however, you have certain health issues, then you could run into some challenges during the life insurance underwriting process. The good news here is that you still have other options – one being a guaranteed issue life insurance policy.
What Is Guaranteed Issue Life Insurance Coverage And How Does It Work?
Guaranteed issue life insurance coverage is a life insurance policy that will pay out a benefit to a named beneficiary upon the death of an insured. These policies are similar to other life insurance policies, except that with a guaranteed acceptance policy, the insurance carrier will accept an applicant for coverage, regardless of his or her health condition.
Because of this, it is not required for the applicant of a guaranteed acceptance life insurance policy to undergo a medical examination as a part of the underwriting process. And, because there are no medical records to examine as a part of the underwriting process, the policy can be approved relatively quickly. In fact, in many cases, these policies can be approved within days – or even sooner – of completing the application.
Who Is A Good Candidate For Guaranteed Issue Life Insurance?
When it comes to guaranteed life insurance coverage, there are several types of individuals who may be good candidates for these policies. In many cases, these plans are sold to those who are over the age of 50 – although there are some companies who will provide coverage to applicants who are younger, depending on the situation.
You may also be a candidate for this type of coverage if you work in a risky occupation. For example, there are some types of jobs that are considered to be more dangerous than others, such as window washers and race car drivers. Because of that, individuals who work at these jobs may or may not be able to qualify for a traditionally underwritten life insurance policy.
There is yet another potential candidate for guaranteed issue life insurance coverage – even though these individuals may be perfectly healthy. These are individuals who may have a fear of needles.
Because a guaranteed issue life insurance policy does not require a medical examination as a part of the approval process, there is no need to take a blood sample – and therefore, the policy can be approved without having to go through a needle stick by a paramed. For some individuals, even having to pay a higher premium for the insurance coverage may be a tradeoff for not having to be stuck with a needle.
That being said, the premium cost of a traditionally underwritten life insurance policy should be compared with a guaranteed issue plan in this particular case, as often the difference in cost can be two – or even three – times higher.
Some Factors To Consider When Purchasing This Type Of Coverage
When seeking a guaranteed issue life insurance policy, there are several important factors to consider. First, the premium on these policies is usually more than that of a medically underwritten policy. The main reason for this is because of the additional risk that the insurance company is taking on.
Another factor to consider when purchasing guaranteed issue life insurance is the fact that you may not be able to purchase as much death benefit protection as you would with a traditionally underwritten policy.
Also, it will be important to ensure that you have a good understanding of exactly how the death benefit proceeds on the policy you are purchasing will be paid out. This is because not all plans will pay out 100% of the stated death benefits upon the death of the insured if the insured passes away within the first few years of policy ownership.
For example, to reduce the amount of risk that the insurance carrier is taking on with an insured, it may only pay out a portion of the death benefit – or possibly even just the premiums that were paid in – for the first two or three years. However, if the insured lives past that period of time and then passes away, the full amount of the stated death benefit will be paid out to the policy’s beneficiary.
How Much Does Guaranteed Issue Life Insurance Coverage Cost?
The cost of guaranteed issue life insurance coverage will usually be higher than a medically underwritten life insurance policy. This is due in large part to the fact that many of the applicants for this type of coverage have certain health issues – and because of this, these individuals will pose more risk to the life insurance company. Therefore, on average, the premium that is charged for a guaranteed issue life insurance policy may be between two and three times more than that of a traditionally underwritten life insurance policy.
What Should You Compare When Shopping For Guaranteed Issue Life Insurance Coverage?
When shopping for a guaranteed issue life insurance policy, there are some items that you should compare before making your policy purchase. These include the following:
- Type of Policy – One key criteria that you will want to compare is the type of policy you are purchasing. In this case, a guaranteed issue policy can be either term or permanent. With term insurance, you will be purchasing just pure death benefit only, for a specified period, such as 10, 15, or 20 years. Because there is no cash value component with a term policy, the premium is usually less than that of a permanent life insurance plan. With permanent life insurance, there is both death benefit protection, as well as a cash value component. Here, the cash is allowed to grow and compound on a tax-deferred basis, meaning that there is no tax due unless or until the funds are withdrawn. There is no time limit on a permanent life insurance policy, so as long as the premium is paid, the policy will remain in force. In addition, the cash that is in the cash value portion of a permanent policy may be either borrowed or withdrawn for any reason by the policyholder.
- Insurance Carrier – You will also want to compare several different insurance carriers prior to making your policy purchase. Insurance companies are typically rated, based on their financial strength and stability. In most cases, it is best to go with those that are rated as an A or better.
- Premium – Comparing several premium quotes is also a good idea, as these can vary a great deal – even for the very same coverage. Doing so through an independent brokerage is usually the best way to do so.
How To Get The Best Guaranteed Issue Life Insurance Premium Quotes
In order to obtain the best-guaranteed issue life insurance premium quotes, you should ideally work with an independent insurance company or agency that has access to multiple insurance carriers. In doing so, you will be better able to compare many different policies, benefits, and premium quotes – and from there you can determine which one will make the most sense for you and your specific coverage needs.
When you are ready to move forward with a policy purchase, we can help. We work with many of the top life insurance carriers in the marketplace today, and we can assist you with obtaining all of the important details that you will require for making a well-informed guaranteed issue policy purchase decision. In order to proceed, all you need to do is just simply fill out the form on this page.
Should you find that you still have any additional questions regarding how to compare guaranteed issue life insurance policies – or even if you just have a question about life insurance in general – our experts are happy to assist you. We can be reached directly via phone, toll-free, by dialing 888-389-8676.
We understand that shopping for life insurance coverage can sometimes feel overwhelming. This is especially the case if you have ever been turned down for a policy in the past. But the good news is that today, you have more options that are available to you – and you have an ally on your side. We can assist you in finding the coverage that you need and in locating the carrier that may be right for you. So, contact us today – we’re here to help.