Guaranteed Issue Life Insurance

Guaranteed issue life insurance is a type of life insurance where approval is guaranteed. There is no medical exam involved. While extremely convenient, the cost deters most people from getting such a policy.
Author: Brian Greenberg CEO of True Blue Life Insurance
Last updated: July 30, 2021

What is guaranteed issue life insurance?

When you’re in the market for life insurance, the option “Guaranteed issue” sounds great, right? No health questions, no medical exam, apply and get approved. If only everything was this simple!

However, this convenience carries a higher risk to the insurance provider. As a result, you’ll end up paying a lot more for the same coverage compared to other life insurance products.

No need to worry. We’ll explain all subjects of guaranteed issue life insurance. When you finish reading this article, you’ll know whether this type of life insurance is right for you or not.

As the name suggests, a guaranteed issue life insurance policy (also called a guaranteed acceptance policy) provides life insurance coverage regardless of your health, or financial history. It’s a type of life insurance that’s generally available for individuals between ages 50 and 85. Some companies make exceptions, like Great Western who’s minimum age is 40.

Guaranteed issue doesn’t qualify you based on your health. As a result, the price for a 50-year-old in supreme health, is the same as for a 50-year-old with a long history of health conditions. Consequently, if you are in good health you could save a lot of money going with a final expense life insurance policy instead.

Key takeaways

  • Anyone between ages 50 – 85 can get approved for guaranteed issue life insurance, regardless of their health or financial history.
  • If you’re in good health, with an uneventful health history, you will save money getting a final expense life insurance policy instead of guaranteed issue.
  • Guaranteed issue life insurance is typically the most popular choice for individuals that have or recently had any type of cancer, or other health conditions that would render them high-risk or uninsurable.

Pros and cons of guaranteed life insurance

No life insurance type is perfect for everyone. Here are some of the pros and cons of guaranteed issue life insurance:

Pros of guaranteed issue

  • Most importantly, you can leave a decent amount of money ($2,500 to $40,000) to your loved ones, even if your health or financial history isn’t stellar.
  • Additionally, there are no medical examinations or health questions to answer.
  • Lastly, there’s hardly any underwriting delay. Depending on the insurance company, a guaranteed issue policy can become active as soon as the same day.

Cons of guaranteed issue

  • First of all, guaranteed issue life insurance is expensive. When comparing the same coverage amount to final expense life insurance, it’s often 2 to 3 times more expensive.
  • Most guaranteed acceptance policies have a Graded death benefit period. This means that if you pass during this time, your beneficiary will not receive the full coverage amount of the policy. Instead, they will receive all paid premiums + 10%.
  • You can’t buy as much coverage as with other life insurance options. For example, the typical max coverage for a guaranteed issue plan is $25,000, with some exceptions going up to $40,000.

How much does guaranteed whole life insurance cost?

A guaranteed issue life insurance policy is more expensive than other products. This is primarily because there are no medical exams or health questions involved. As a result, it is most popular for individuals with less than average health.

The sample rates below are for guaranteed issue life insurance for men (women pay 10% to 15% less on average):

AgeCoverageCompanyPrice
40$25,000Great Western$119.58
45$25,000Great Western$134.17
50$25,000Gerber$108.86
55$25,000Gerber$143.46
60$25,000Gerber$158.36
65$10,000AIG$84.15
70$10,000AIG$98.18

Who is guaranteed acceptance life insurance for?

Guaranteed acceptance life insurance is more expensive to other alternatives. Therefore, it’s most common for seniors or people that are considered high-risk.

When are you considered high-risk?

The most common reason to be considered high-risk is primarily because of your health, or health history. If diagnosed with a serious health condition, such as cancer, you will be high-risk for many years to come. Other reasons to be flagged as high-risk, are dangerous professions or hobbies. Skydiving or deep-sea diving for example.

If you are a high-risk individual, then a guaranteed issue policy can be a good option. However, most guaranteed acceptance products do have a graded benefit duration of 2 years. For that reason, your beneficiaries will not receive your full coverage amount during this period. Instead, they will receive your paid premiums + 10%. A guaranteed issue policy can provide up to $40,000 of coverage. Enough to pay off debt, pay for funeral costs, or to leave a small inheritance.

Not sure how much you need? The Federal Trade Commission states that a funeral home has to provide you with the cost of the funeral you want.

Best guaranteed issue life insurance companies

A life insurance company can have stellar performance when it comes to term life insurance. But that may not be true for their guaranteed acceptance products, or perhaps they don’t offer at all.

We chose the following companies based on our extensive experience.

The best guaranteed issue life insurance companies are Gerber, AIG, and Great Western.

GerberAIGGreat Western
Age50 - 8050 - 8040 - 80
Coverage$5,000 - $20,000$5,500 - $25,000$2,500 - $40,000
Graded period2 years2 years2 years
AvailabilityAll 50 statesNot in New YorkNot in New York
Compare rates for these companies

#1 Gerber: If you are between the ages of 50 and 80, you can choose from $5,000 to $25,000 in guaranteed life insurance from Gerber Life Insurance Company. The application process is simple and easy. No medical exam is required and there are no health questions to answer. Your acceptance – regardless of your health – is guaranteed.

#2 AIG: AIG insurance offers $5,000 to $25,000 in coverage for individuals between the ages of 50 and 80. The application process is easy and fast. Most cases have no waiting period and as a result, are processed within 15 minutes. You also can’t be turned down for health reasons.

#3 Great Western: Great Western Life Insurance Company offers the highest coverage amount limit of $40,000 ($48,000 in some scenarios), for individuals between ages 40 and 85. This makes Great Western the only product available for high-risk individuals under the age of 50.

Great Western is 10-25% more expensive than Gerber or AIG, because it’s policy is unique. If you can answer three medical questions, you can get $48,000 in guaranteed acceptance coverage.

Finally, Great Western’s guaranteed acceptance life insurance also includes two additional benefits:

  • Accelerated Death Benefit will pay the current value of your policy if you have less than 12 months to live due to a terminal illness diagnosis.
  • Children’s Insurance Benefit Rider, this allows you to get a life insurance policy on a dependent child or grandchild for $2,500 for just $1/month.

How long does it take to get guaranteed issue life insurance?

Guaranteed acceptance policies do not take long to go in effect, typically less than 48 hours. Some companies issue your policy as fast as the same day with no waiting period. There’s no medical exam or health questionnaire to evaluate. As a result, the underwriting process is simple and fast. It is important to mention that while your policy can be active the same day, there will be a graded benefit period.

Graded benefit period:

A graded benefit period is a duration of time during which the life insurance policy does not pay the full coverage amount. Rather, if the insured were to pass during this time, the beneficiary would receive all paid premiums + interest (typically 10%).

What are alternatives to guaranteed issue life insurance?

The best alternatives to guaranteed issue life insurance are term life insurance, final expense life insurance, and lastly, accidental death insurance. Which alternative is best for you depends on your age and your health.

Term life insurance – Average or better health, age 55 or younger

  • Term life insurance is by far the most popular life insurance choice for ages 55 or younger. If you’re in excellent to average health then you could get the same coverage as a guaranteed acceptance policy, but 3 to 5 times cheaper.
  • Depending on the term policy and coverage amount applied for, there will be a medical examination. For policies under $1,000,000, you have the option of a no medical exam life insurance plan.

Final expense – Average health, age 55 or older

  • Final expense is the most popular life insurance option for healthy seniors. It’s a whole life policy, just like guaranteed issue, meaning as long as you make the premium payment, you’ll stay insured.
  • It offers a higher coverage amount than guaranteed issue policies, up to $100,000.
  • There is no medical examination involved. However, insurance providers will ask you some health questions, as well as check your public records to qualify you.

Accidental death – High-risk individuals, any age

  • Primarily, accidental death life insurance is very affordable. Additionally, it’s available to anyone, regardless of their health or financial history.
  • However, an accidental death policy only pays your beneficiaries if the cause of death is due to an accident. Additionally, accidents are only the most common cause of death for individuals age 44 or younger, according to the CDC.

Group life insurance – High-risk individuals at any age

  • Group life insurance is most commonly offered to employees by employers. Group insurance is also offered by many different types of trade groups, organizations, and associations.
  • Small life insurance coverage amounts are offered as a free benefit, or at a low cost to a group’s members. There are very few health questions to qualify.
  • Groups are able to offer term, whole life, and universal life insurance plans to its members. The coverage types available depend on the insurance company underwriting the policies.
  • The group coverage is owned by the master policyholder, and members receive certificates of participation. Coverage may decrease or end if the organization drops the coverage.

How do I get guaranteed life insurance?

We make shopping for life insurance as simple as possible. You can shop online, or we can assist you in finding the best policy, from the best company, based on your situation.

Compare rates online

  • Fill out our quote form to compare rates online from the best providers in less than 30 seconds.
  • Select the policy you like and submit an application.

Speak to a licensed agent

  • Do you prefer to make financial decisions by speaking to a professional? Call us at 1-866-816-2100 to speak to a friendly licensed True Blue agent.
  • We are able to answer any questions you may have, as well as recommend the best insurance company based on your situation.

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About the author
Brian Greenberg author
Brian Greenberg
Founder and CEO
Brian is licensed to sell life, health, annuities, and property and casualty insurance in all 50 U.S. states. He is the author of The Salesman Who Doesn't Sell and is a member of the Million Dollar Round Table, an organization that consists of the top 1% of financial advisors worldwide.