Guaranteed Acceptance Life Insurance
Guaranteed acceptance life insurance is pretty much exactly what its name
implies--you apply for it and as long as you can pay for it you get it.
There is no medical exam, there are no medical questions.
Guaranteed acceptance life insurance, as you might imagine, is far more
expensive than the same amount of death benefit for the same person with
traditional life insurance underwriting. So why would anyone want to
apply for it? The answer is there are some people who may be uninsurable
due to health complications; uninsurable, that is, unless they pay extra
money in exchange for no-questions-asked life insurance underwriting of
One great downside of guaranteed acceptance life insurance policies,
however is insurance companies don't allow very high face amounts--if
they did they would fall prey to adverse selection and possibly be driven
out of business (or at least that's how they feel about it). You probably
cannot get more than $25,000 of guaranteed life insurance if you need it.
But there is an answer for this: you are permitted to own all the life
insurance you can afford to pay for, and you can own that life insurance
in the form of several or many different policies from different
insurers. You are thus allowed to own, for instance, $100,000 worth of
guaranteed acceptance life insurance in the form of, say, five different
There are, however, other limitations to these policies. Some policies
only pay out the death benefit on a graduated scale if you die in the
first few years of the policy. That is, your beneficiary might receive
only a small fraction of the face amount of the policy if you die in the
second year, etc. There may be a threshold of a few years you still need
to live after the policy is put in force before you beneficiary would
receive the full death benefit. And some policies just flat-out have a
waiting period--that is, if you die in, say, the first two years of the
policy, your beneficiary receives nothing or receives only the return of
the premiums you paid.
There are also minimum age requirements and often maximum ages for
underwriting rules of guaranteed life insurance policies. Companies vary.
Also, not every state's insurance board allows guaranteed life insurance,
so it's not available in every state. Indeed, the guaranteed life
insurance policy could potentially cost you more in premiums than it pays
out, depending on when you die, and this is such a problem that it's
being investigated at the time of this writing by the National
Association of Insurance Commissioners.
But again, if you have a serious medical condition, and especially if you
have this and you are over the age of 50, guaranteed life insurance may
be your best option for getting the coverage you need or desire.
The best way for buying guaranteed life insurance policies is to go
through a life insurance broker. He can give you the best objective
advice about whether it's worth it and help you find more than one
company to underwrite you.
One thing to keep in mind if you are middle aged or a senior is that not
everybody needs life insurance, although most probably do at some point
in their lives. If you have enough assets that your final expenses would
all be able to be taken care of by your survivors and you feel no need
for any additional estate protection, you are "self insured" and you
don't need life insurance.
The author lives with her husband in Maryland, with their two dogs and
cat. She put together the website http://www.affordable-life-insurance-
guru.com in order to help the everyday person navigate the often
confusing world of life insurance