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Is a Guaranteed Issue Policy Right for You?

Posted on Thursday, August 10, 2023
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by Ian Gargan
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Guaranteed policy

Guaranteed life insurance policies are a product created to solve problems for certain groups. Use this guide to decide if the GIWL is the policy for you. At any point, if you want to call your friendly RoseMark advisor they could guide you through the process.

Why choose A GIWL?

Being turned down is not likely when it comes to guaranteed issue policies. These policies are ideal for those who have existing health issues or would like to avoid medical examination. It can also be a good alternative for people that already have a term policy and fear they may outlive it and be left without a benefit. This would provide a smaller benefit, but it will ensure coverage for the entirety of your life. Applicants will not answer health questions and the process is quick and easy. Benefits are only offered up to $25,000 but it can be the perfect policy for funeral costs. The approval process is instant and complete in moments.

You can borrow against your policy for cash value and the rates will never increase.

Why Not Choose a GIWL?

Like many things in life, nothing is a one size fits all solution. There are downsides to a guaranteed policy also. The company is offering this benefit without medical underwriting, so they assume you are in the high-risk category for your rating. If you are in good or even great health, you could apply for a whole-life policy with medical underwriting for a fraction of the cost.

Another downfall is the graded death benefits. They will not pay out the total death benefit of the policy until you have paid 2 years in premiums. This deters very sick people from purchasing policies on their death bed.

What is a graded death benefit?

For the first two years, this policy will act as an accidental death policy. If something happens to you before the second year you will receive what they call “graded death benefits”. This will pay out the amount of premium you’ve paid plus 10% interest. If you pass independent of sickness or other causes your full benefits will pay out from the first day of the policy. If your death occurs due to a car accident, then your benefit will double.

Speak with a professional

Guarantee issue policies have their pros and cons, but if you remain unsure, call one of our knowledgeable advisors. RoseMark can offer quotes from hundreds of A+-rated providers. RoseMark is a licensed Fiduciaries and the only exclusive provider of AMAC Members.

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