Best Guaranteed Universal Life Insurance in 2024

Buying life insurance is one of the most thoughtful decisions you can make to secure your family’s financial future. Whether you’re young, middle-aged, or nearing retirement, buying life insurance helps your family mitigate the void of your passing.

Fortunately, there are many options when shopping for life insurance. Some of these options include term life insurance vs. whole life insurance. Another interesting option is guaranteed life insurance.

What is guaranteed life insurance? What are the pros and cons of choosing guaranteed life insurance over other options? This guide will answer all of these pertinent questions to help you make an informed decision.

Guaranteed Universal Life (GUL) Insurance Definition

Guaranteed universal life insurance is special coverage extended to people for the rest of their life. A GUL policy doesn’t require a medical exam, and you can typically skip any health questions altogether.

Guaranteed life insurance, also known as guaranteed acceptance or guaranteed issue life insurance, is whole life insurance, a category denoting the permanent status of coverage compared to different types of term life insurance.

Most insurance companies require applicants to take a medical exam and answer health-related questions to see if they carry any risk. The reason is that insurance companies want to ensure the applicant won’t suddenly pass away shortly after signing a policy.

With guaranteed life insurance, the company agrees to pay your death benefit to your beneficiaries under certain circumstances. However, it’s worth mentioning that guaranteed life insurance comes with some noticeable drawbacks.

One con is that you’ll almost always pay higher premiums since the insurer automatically deems you a health risk and wants to buffer an expected loss if you pass away.

Also, it’s rare to find guaranteed acceptance life insurance with no waiting period, as this might place the insurance company at a higher risk of paying out on a death benefit before making enough money in premiums.

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Who Needs Guaranteed Acceptance Life Insurance

Guaranteed life insurance isn’t for everyone. However, it can provide coverage to people without any other options. Typically, guaranteed life insurance covers a person’s burial expenses. Sometimes people even call it burial insurance.

In some cases, the policyholder may want to leave a large lump sum to their family when they pass away.

So if you’re considering purchasing guaranteed life insurance, here are some things to consider:

• Guaranteed life insurance is ideal if you have chronic medical conditions making it very expensive or impossible to purchase other types of insurance like whole life. 
• You should consider guaranteed life insurance if you have a limited short-term budget.
• You must be fine with a small coverage amount. Guaranteed life insurance coverage amounts usually don’t exceed $50,000.

As you can see, there are several caveats to purchasing guaranteed life insurance. Generally, it makes the most sense to buy guaranteed issue life insurance if you can’t find coverage elsewhere.

If you’re sick with multiple health conditions, your rates may be higher with other insurance companies, or you could get denied coverage entirely. For this reason, guaranteed life insurance is often the last resort option for many people across the country. 

If you don’t fall into this category, better options are available. For example, policies like universal life insurance can provide coverage amounts in the millions. While these options require a medical exam, you’ll usually receive more affordable pricing.

There are several alternatives, such as no-medical exam term life insurance, which is an ideal option for people considering term life insurance. 

Everything to Know About Guaranteed Issue Life Insurance 

If you’ve decided that guaranteed issue life insurance is right for you, there are several important things to consider. Here is everything you need to know about guaranteed life insurance, from the anticipated rates to the coverage caps. 

The Best Age to Buy Guaranteed Universal Life Insurance

Most forms of life insurance won’t require you to be a certain age to apply. However, that’s not the case for people applying for guaranteed life insurance.

Most guaranteed life insurance companies have minimum age limits between 40 and 50. Also, most of these companies won’t sell a policy to you if you’re older than 80. There are a few reasons why these companies do this. 

One reason is that guaranteed life insurance usually has low coverage amounts, an unattractive feature for young, healthy people who need large coverage amounts to fill their void if they suddenly pass away.

Also, guaranteed life insurance companies are wary about insuring people in advanced age. Providing guaranteed coverage for people older than 80 is seen as a poor business decision.

Purchasing guaranteed life insurance may be a great idea if you’re older than 40 and know you won’t pass a standard medical exam. However, if you’re young or healthy, better options are available. Check out our guide on life insurance rates by age and gender.

Guaranteed Universal Life Coverage Amounts

Coverage amounts for guaranteed life insurance are generally very low. If you receive a guaranteed life insurance policy, you can expect a coverage amount between $10,000 and $25,000.

Again, because of these low amounts, guaranteed coverage is usually aimed toward final expenses like burial, small debts, and medical bills. 

It’s worth noting that guaranteed coverage provides the lowest industry coverage amounts while having some of the highest possible premiums. So you may pay exorbitant guaranteed term life insurance rates just to have a small coverage amount.

If you purchase whole life insurance, expect a coverage amount of at least $250,000. Similarly, you can receive a coverage amount between $250,000 and $750,000 if you decide to buy term life insurance.

When purchasing life insurance, you should select a policy that’s six to ten times your annual salary. For example, if your annual salary is $50,000, you should buy a policy worth $500,000.

Some experts also recommend adding $100,000 in coverage for every child you have. Overall, guaranteed life insurance doesn’t provide the coverage amount you need to secure your family after your passing. 

Compare Guaranteed Universal Life Insurance Rates

Ironically, guaranteed life insurance is one of the most expensive ways to buy life insurance. So essentially, you’re paying normal life insurance rates just to have little coverage when you die.

You should consider another life insurance policy if you have serious health issues that will get you rejected from other policies. You can consult an independent insurance agent or an advisor if you’re concerned about high rates. (For more information, read our “How to Find a Life Insurance Advisor“).

An independent insurance agent, also known as an insurance broker, is a person that doesn’t represent a single insurance company. So they don’t have a conflict of interest when selling you the right life insurance policy that won’t break the bank.

When you choose an insurance broker, they can help you sort through various guaranteed life insurance companies to find the right price. An insurance advisor has insider knowledge to point you in the direction of insurers with the best pricing according to your medical conditions. Your insurance rates ultimately will depend on your gender and age.

You’ll typically enjoy the lowest guaranteed life insurance rates if you’re younger and female since many studies prove that women outlive men.

GUL Graded Death Benefits

Guaranteed life insurance companies implement special measures to protect themselves against risky policyholders. One measure is a graded death benefit to avoid paying death benefits from life insurance for the terminally ill.

A policy with graded death benefits means your beneficiary won’t get paid the full death benefit if you die within the first few years of buying the policy.

So, if you pass away after the first year of buying your policy, your beneficiary may only receive a refund of your premiums plus interest. The amount of interest paid usually varies but can appreciate after each year.

For instance, the insurance company may pay 10% of your policy if you die within the first year, 20% in the second year, and maybe all of the death benefit if you die after the third year. However, there are some caveats to this rule.

If you pass away due to an accident, your guaranteed life insurance company will pay the full coverage amount to your beneficiary, even if you just bought the policy.

Guaranteed Issue Cash Value Life Insurance

It’s common for people to take equity from the cash value of their insurance policies during their lifetime. Borrowing from life insurance is an ideal way to receive instant cash when facing financial hardship. If you have a guaranteed life insurance policy, it may build cash value over time.

If your policy builds cash value, there are some conditions you should know about. For example, if you don’t pay back your policy loan before you die, the insurance company deducts the amount you owe from your coverage amount. So if you borrow money from your life insurance policy, your beneficiaries receive a lower amount.

Another important thing to note is that your beneficiaries only receive your full coverage amount, even if it gains cash value over time. So, if you’re on a limited budget, avoid borrowing from your life insurance policy if you can help it. Doing so can lower an already low policy amount and make it difficult for your loved ones to cover your burial expenses after you die.

Guaranteed Universal Life (GUL) Insurance: Pros and Cons

If you’re on the brink of purchasing guaranteed life insurance, you should weigh your pros and cons to ensure you’re getting coverage you need. 

Here are some pros to purchasing a guaranteed life insurance policy:

• Guaranteed life insurance has a relatively easy application. Since there isn’t much of an underwriting process, your application can get processed in a few days.
• You don’t have to take a medical exam for life insurance if you’re buying guaranteed issue coverage, meaning you don’t have to worry if your underlying medical conditions influence higher premiums or outright coverage denial. 
• You also don’t have to answer any questions about your health, saving you the anxiety of waiting for approval.

While guaranteed issue life insurance has its pros, there are also some cons to consider:

• Guaranteed life insurance policies have very low coverage amounts. There are better options if you’re looking for better financial security for your family after your death.
• Your beneficiaries won’t receive the full death benefit if you pass away during the first few years unless you die from an accident. 
• The price you pay for coverage is extremely high. You don’t have to pay high amounts for low coverage if you’re healthy and young.

You should consider cost when evaluating your life insurance options, particularly regarding guaranteed issue life insurance.

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Guaranteed Universal Life (GUL) Insurance Rates vs. Whole Life Insurance Rates

Guaranteed issue life insurance is a form of whole life insurance. However, that doesn’t mean both options have similar rates. In fact, whole life insurance companies charge rates that are almost always cheaper than guaranteed life insurance rates.

So, you’ll save more money with a traditional life insurance policy unless you have a serious medical condition.

According to data from the lowest quotes we found online, a 70-year-old female with a $20,000 guaranteed life insurance policy typically pays $19,000 over 10 years. On the other hand, a 70-year-old female with a $20,000 whole life insurance policy would only pay $12,500 for her policy. (For more information, read our “How to Find an Old Life Insurance Policy“).

The amount paid for the guaranteed life insurance policy is astronomical, considering the woman would pay as much as the life insurance policy is worth. On top of that, if the woman dies early, her beneficiary won’t receive the full death benefits.

If your goal is to save money, you should consider purchasing a whole life insurance policy. On the other hand, buying a guaranteed life insurance policy is better than nothing if you know your application will get denied. 

Compare Guaranteed Universal Life (GUL) Insurance Companies

Guaranteed life insurance is popular, even with some noticeable shortcomings. Below, we’ll list some companies offering guaranteed life insurance. However, it’s important to note that the following products may not be available in all states.

In addition, ensure you carefully read each company’s policies on graded death benefits before committing. 

AAA Life Insurance

AAA Life Insurance is one of the most popular insurance companies in the United States.

They offer various insurance products, such as:

• Term life insurance
• Whole life insurance
• Universal life insurance
• Accident insurance
• Annuities

AAA Life Insurance offers a quick and easy application process to complete underwriting as soon as possible, with benefits up to $25,000. The company also provides lifelong guaranteed coverage right away, regardless of your health conditions. 

AAA Life Insurance claims applicants can lock in a rate for their policy’s lifetime, ensuring their premiums won’t increase with time. Also, your guaranteed life insurance policy with AAA Life Insurance is eligible to build cash value over time. (For more information, read our “AAA Life Insurance Review“).

AARP Life Insurance

AARP is one of the world’s oldest and largest non-profit organizations, helping Americans over 50 live empowered lives. The organization has more than 38 million members and runs the second-largest magazine in the United States regarding circulation.

AARP provides guaranteed life insurance through New York Life, a prominent insurance provider in New York City. Policyholders can receive coverage amounts up to $25,000. 

For more information about New York Life, read our New York Life Insurance Company Review.

You can use this amount to cover final burial expenses and take the burden of funeral expenses away from loved ones. However, there’s one major catch. AARP doesn’t provide guaranteed life insurance for people who are terminally ill.

There’s a great degree of unambiguity with this condition. Will AARP provide guaranteed life insurance to people with terminally ill conditions that worsen immediately?

Or, will AARP deny all individuals suffering from a slow-moving terminally ill condition, such as kidney failure and heart disease? The answer isn’t clear unless you apply or speak to one of their insurance agents. 

If you qualify, you can enjoy a simple application and underwriting process. Once your application gets accepted, your rates will never increase. 

However, there’s a two-year benefit period, meaning your beneficiary won’t receive the full death benefit if you die in under two years.

AIG Direct Life Insurance

AIG Direct is a lesser-known insurance provider located in California. Founded in 1995, the company provides a wide range of insurance products in more than 70 countries and locations worldwide. 

AIG Direct is an American General Life Insurance Co. subsidiary listed on the New York Stock Exchange. AIG offers guaranteed life insurance in amounts between $5,000 and $25,000. 

While AIG Direct isn’t as popular as the previous options, they do offer some exclusive benefits, such as:

• Cheap starting rates of $21/month for a female and $29/month for a male with $5,000 in coverage.
• AIG Direct offers many living benefits for both chronic and terminal illnesses.
• AIG Direct provides compassionate compensation for people who have Alzheimer’s or dementia.

AIG Direct defines “terminal illness” as individuals reasonably expected to pass away within 24 months of diagnosis.

If you or a loved one fits this category, you can receive the peace of mind that you won’t be turned down for insurance and receive the cash to cover your funeral expenses.

For more information on AIG, read our AIG Life Insurance Review.

Alfa Insurance

Alfa Insurance is a subsidiary of Alfa Corporation, headquartered in Montgomery, Alabama. Founded in 1946, Alfa Insurance is one of the largest insurance companies in the southern United States, with an annual revenue of $1 billion.

If you’re considering a guaranteed acceptance life insurance policy, here is everything you need to know about this company’s product:

• All policyholders receive up to $25,000 to help pay for credit card debt, funeral costs, and medical bills.
• This form of life insurance is only available for people between 40 and 80. 
• Alfa Insurance will return payments with 10% interest if your death wasn’t accidental within two years of signing your policy.

There are two important things to note here. First, Alfa Insurance cuts off its guaranteed life insurance once you reach 80. Therefore, you’ll have to choose another option if you’re older.

Also, Alfa Insurance doesn’t have a clear policy for accepting people with terminal illnesses. So if you’re dealing with a terminal illness, contact a life insurance agent or broker to find out.

Finally, Alfa Insurance doesn’t list its rates, so you’ll need to receive a quote to find out how much you’ll pay for guaranteed coverage.

Colonial Penn Life Insurance

Colonial Penn is a well-known insurance company located in Philadelphia, Pennsylvania. AARP founder Leonard Davis, a noted philanthropist, founded the company in 1968. 

Now, CNO Financial Group owns Colonial Penn. Colonial Penn provides guaranteed life insurance up to $50,000 in most states for people between 50 and 85. 

One important thing to note is that Colonial Penn uses a unit pricing model, meaning the company offers units of coverage to everyone, starting at $9.95 monthly. However, the coverage amount within your unit varies depending on your gender and age.

Colonial Penn is one of the only insurance companies offering guaranteed life insurance to people over 80. Also, they provide up to $50,000 in coverage, a higher coverage amount than most other competitors. 

Colonial Penn will never cancel your coverage. Policyholders can also take advantage of flexible payment options, locked-in premium rates, and no required medical exam. 

Colonial Penn will pay your entire death benefit if you live more than two years after signing your policy.

For more information about Colonial Penn, read our Colonial Penn Life Insurance Review.

Fidelity Life

Fidelity Life is one of the oldest insurance companies in the world. Founded in 1896, Fidelity Life began as the Mystic Workers of the World. They established a reputation for selling life insurance policies to both men and women. 

Renamed Fidelity Life in 1930, they serve approximately 40 million customers nationwide. Fidelity Life offers guaranteed life insurance through a program known as RAPIDecision.

Policyholders can receive coverage up to $25,000 if they’re between 50 and 85. However, there are two things to remember if you’re considering Fidelity Life as your insurance provider. 

Fidelity Life policyholders are subject to graded death benefits for up to three years. If you buy a policy and die before then, you’ll receive a refund of your premiums with interest under special conditions. 

Also, customers can build cash value with their policies. Though, with any guaranteed life insurance policy, your beneficiary won’t receive this added cash value on top of the death benefit. 

With added cash value, policyholders can borrow from their policies during financial hardship, but rates will depend on your specific age. Compare AIG and Fidelity life insurance to see if one is better than the other for you.

Read more: How To Cancel Your Fidelity Life Insurance Policy

Gerber Life Insurance

Founded in 1967, Gerber Life Insurance is owned wholly by the Gerber Products Company. Gerber Life Insurance offers policies for both adults and children, like the Gerber Grow Up Plan.

Specifically, the company provides guaranteed life insurance for people between 50 and 80. Regardless of your health history, you can receive coverage without filling out long application forms or taking a medical exam.

In addition, Gerber Life Insurance offers very specific terminology for their cash value increase policy. The company will put aside money from your policy that grows over time.

Policyholders can borrow from this amount as needed, and the longer you have your policy, the higher its value increases. However, your policy loan interest rate is 8%. If you fail to pay back the principal amount and interest before you die, that amount deducts from the death benefit paid to your beneficiaries.

If you choose Gerber Life Insurance for guaranteed life insurance, you can take advantage of an easy way to save money when buying life insurance over your policy’s lifetime.

Policyholders can save up to 8% on their monthly premiums by signing up for EasyPay, a feature for adding your checking or savings accounts.

Read more:

• How To Cancel Your Gerber Life Insurance Policy
• Gerber Life Grow-Up Plan Review

Mutual of Omaha

Mutual of Omaha is one of the most prominent insurance companies in the world. The company offers a wide assortment of insurance and Medicare products, such as Mutual of Omaha Living Promise. 

Mutual Omaha is also a Fortune 500 company with more than 6,000 employees and $9 billion in total revenue.

Mutual of Omaha offers convenient, permanent, and reliable life insurance for adults between 45-85. The total coverage amount is between $2,000 and $25,000. 

Mutual of Omaha says policyholders don’t need to take a medical exam or deal with rate increases. Not much public information is available about Mutual of Omaha’s guaranteed life insurance policy, but there are some things to be wary of as a potential customer.

To begin, if you have a terminal illness, there isn’t any specific information about whether you can submit an application. Also, there isn’t any public information about graded death benefits. 

If you need specific quotes and information about Mutual of Omaha’s guaranteed life insurance policies, speak to an insurance agent to make the most informed decision for you and your family.

Vantis Life

Vantis Life is a subsidiary of Penn Mutual, one of the largest and oldest insurance companies in the United States. The company provides guaranteed life insurance for people between 50 and 80.

If you sign up for a policy with Vantis Life, you can purchase coverage up to $20,000. Vantis Life offers guaranteed life insurance rates that increase with age based on your location. For example, a 50-year-old male can receive coverage of $10,000 for $42.58 a month. (For more information, read our “Vantis Life Insurance Review“).

On the other hand, a 70-year-old male can receive $10,000 coverage for $91.24 monthly.

For more on Vantis Life and Penn Mutual, read our Penn Mutual Life Insurance Review.

Americo Life Insurance

Founded in 1946, Americo’s headquarters is in Kansas City, Missouri, and is a United Fidelity Life Insurance Company subsidiary. With more than 700 employees, you can be confident that Americo has the financial strength to pay your death benefit when the time comes.

Read more: Missouri Life Insurance

Americo offers guaranteed life insurance policies with coverage up to $10,000. However, this company has a small window to receive coverage. Only people between 50 and 75 can apply for coverage.

Contact one of their insurance agents for guidance if you have any questions about graded death benefits, terminal illnesses, or how to cancel your Americo Financial Life & Annuity life insurance policy.

Case Studies: Guaranteed Universal Life (GUL) Insurance

Case Study 1: John’s Burial Expense Coverage

John, a 62-year-old man with several pre-existing health conditions, is concerned about the financial burden his funeral expenses may impose on his family. He decides to explore guaranteed life insurance options and considers GUL insurance.

After comparing quotes from different insurance companies, John chooses a GUL policy with a coverage amount of $20,000. This policy provides him with peace of mind, knowing that his family will have the necessary funds to cover his final expenses.

Case Study 2: Sarah’s Last Resort Coverage

Sarah, a 55-year-old woman, has been denied coverage by multiple insurance companies due to her terminal illness. Frustrated but determined to secure financial protection for her family, she turns to guaranteed life insurance as a last resort.

Sarah opts for a GUL policy with a coverage amount of $50,000, ensuring that her loved ones will receive a death benefit even with her health condition. While the premiums are higher compared to other types of life insurance, Sarah values the peace of mind and security this policy offers.

Case Study 3: Michael’s Limited Coverage Needs

Michael, a 40-year-old individual with no significant health issues, wants to supplement his existing term life insurance policy with additional coverage. Since he only needs a relatively small amount of coverage, he considers GUL insurance as a viable option.

After reviewing his options, Michael selects a GUL policy with a coverage amount of $25,000 to ensure his family’s financial stability in case of an unexpected event. The policy provides him with the desired coverage without the need for a medical exam or extensive health-related questions.

Case Study 4: Emily’s High-Risk Coverage

Emily, a 68-year-old woman, has a history of chronic health conditions that make it challenging for her to qualify for traditional life insurance policies. Despite her health challenges, Emily understands the importance of leaving a financial legacy for her children and grandchildren.

She decides to explore guaranteed life insurance options and discovers GUL insurance. Emily carefully compares quotes and finds a GUL policy that offers a coverage amount of $30,000. This policy ensures that her family will receive financial support even with her high-risk profile.

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The Bottom Line on Guaranteed Universal Life (GUL) Insurance

Ultimately, buying a life insurance policy is a monumental decision. Your choice has definite long-term ramifications for you and your family. 

Contact a life insurance broker if you’re uncomfortable deciding on your own, are new to the process, or have questions. This individual will scout the market for your budget’s best prices.

They’ll also curate a list of insurance companies offering guaranteed life insurance according to your terms, whether you’re dealing with advanced age or a terminal illness. Finally, insurance brokers will know which companies give you the best deal based on your health history.

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