Guaranteed Life Insurance is coverage that has no medical requirements. The only thing restricting some people from getting it is age (most policies have a minimum age requirement of 40 to 50, and maximum age of about 80). Also, policies are only available in the states in which they are approved.
Guaranteed Life Insurance has a graded period that varies from company to company. Graded periods are commonly 2 or 3 years long. During the first 2 or 3 years of the policy, if death would occur due to natural causes, a percent of the face amount is paid, or all the premiums are paid back with an additional percent added. During the graded period, accidental death usually pays 100%. After the graded period, the policy pays 100% for death by any reason.
1) If by guaranteed life insurance you are referring to guaranteed issue life Insurance, that is coverage that cannot be declined for health reasons. The policies usually have rather narrow age guidelines, low maximum face amounts, and are graded during the first 1-3 years for death due to natural causes. E.g. If the insured person died of a heart attack during the first years of the policy, the beneficiary would receive a reduced death benefit (often return of premium, plus a little extra). If death occurs after the graded period ends, the policy pays the full face amount. It usually pays 100% of the face amount from day one for accidental death.
Some guaranteed issue life insurance policy premiums are guaranteed not to go up for life. Some can go up every year, and others are in between (e.g. can go up every 5 years). Keep in mind that you will want to be able to afford this policy in the years ahead, and get lifetime guaranteed level premiums, if possible.
Guaranteed issue life insurance can be a good choice for people who cannot qualify for any other coverage. Even if death is anticipated within the first two years, the return is better than any savings account. And people are often able to survive serious diseases beyond what is expected.
2) If by guaranteed life insurance you mean life insurance where the premium and face amount are guaranteed, it simply means that the premium cannot go up, and the face amount cannot go down, for a certain period of time. In Term insurance, the guaranteed level period is usually for the term of the policy. In Universal Life, the guaranteed period can be for life, or it can be for a set number of years.
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Guaranteed Life Insurance has a graded period that varies from company to company. Graded periods are commonly 2 or 3 years long. During the first 2 or 3 years of the policy, if death would occur due to natural causes, a percent of the face amount is paid, or all the premiums are paid back with an additional percent added. During the graded period, accidental death usually pays 100%. After the graded period, the policy pays 100% for death by any reason.
Some guaranteed issue life insurance policy premiums are guaranteed not to go up for life. Some can go up every year, and others are in between (e.g. can go up every 5 years). Keep in mind that you will want to be able to afford this policy in the years ahead, and get lifetime guaranteed level premiums, if possible.
Guaranteed issue life insurance can be a good choice for people who cannot qualify for any other coverage. Even if death is anticipated within the first two years, the return is better than any savings account. And people are often able to survive serious diseases beyond what is expected.
2) If by guaranteed life insurance you mean life insurance where the premium and face amount are guaranteed, it simply means that the premium cannot go up, and the face amount cannot go down, for a certain period of time. In Term insurance, the guaranteed level period is usually for the term of the policy. In Universal Life, the guaranteed period can be for life, or it can be for a set number of years.