Guaranteed Acceptance Life Insurance: Best Companies & What to Look Out For

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Guaranteed acceptance life insurance, also called guaranteed issue or GI life insurance, is typically a whole life insurance policy with a limited death benefit. As with other whole life insurance policies, guaranteed issue policies will build a cash value over time and coverage lasts as long as you continue to pay the premiums. However, death benefits are typically restricted to less than $25,000.

Unlike most life insurance policies, there are no health questions when applying for guaranteed acceptance insurance and you don’t have to take a medical exam. Quotes are entirely based upon your age, location and gender. Given the simplicity of the application, you can often get instant coverage, and in many cases purchase online.

The downside to guaranteed acceptance whole life insurance is that quotes will be significantly more expensive since the insurer has no health details and has to assume you’re high-risk.

Should I Buy Guaranteed Issue Life Insurance?

Guaranteed acceptance insurance is incredibly expensive for the amount of coverage you can purchase since the insurer is unable to collect or verify any information about your health. This is why, while guaranteed issue life insurance is convenient, we only recommend it if you’re unable to qualify for other forms of life insurance.

Even if you’re a senior citizen or have a pre-existing medical condition that would disqualify you from fully underwritten coverage, you should first try simplified issue life insurance. Simplified issue life insurance doesn’t require a medical exam and accepts a wider range of health problems than fully underwritten coverage. But, since you answer a few questions about your health, premiums will be lower than with guaranteed acceptance insurance. In addition, you can find term life insurance and universal life insurance policies that are simplified issue, so you’re not restricted to whole life insurance.

In addition, the limited amount of coverage you can purchase means that guaranteed insurance will typically only cover end-of-life expenses. Since a funeral costs around $10,000 on average, guaranteed issue insurance should provide a large enough death benefit if you just want to take care of final expenses. However, if you want enough coverage to send a child to college or pay off a mortgage, guaranteed acceptance insurance won’t provide a large enough death benefit.

There are several medical conditions that may preclude you from qualifying for fully underwritten or simplified issue life insurance, so you’ll want to consider guaranteed issue life insurance if:

  • You’re on dialysis
  • You have cognitive impairments
  • You’re restricted to a wheelchair
  • You’re in a nursing home
  • You have HIV, kidney disease or cancer, particularly if you were diagnosed in the past 2 years

If you are elderly or have a severe health problem, it’s important to note that guaranteed acceptance policies come with a 2 to 3 year “waiting period”. If you pass away during this period of time due to a natural cause, such as a disease or heart attack, your beneficiaries won’t get the full death benefit. Typically, they will only receive the amount of money you had paid in premiums plus interest (interest rates vary by insurer).

Comparison of Guaranteed Acceptance Life Insurance Companies

It can be challenging to find the best guaranteed acceptance life insurance for your needs, so we’ve assessed the top 9 carriers based upon quotes and coverage.

Best Guaranteed Acceptance Life Insurance Companies

AIG is our favorite insurer for guaranteed acceptance life insurance because their prices are competitive and they let you accelerate death benefits if you become ill. However, each of the 5 companies below has reasonable quotes and a strong range of coverage options for their guaranteed issue policies.

AAAAIGGerber Life InsuranceMutual of OmahaNew York Life
Age Availability45-8550-8550-8045-8550-80
Waiting Period2 years2 years2 years2 years2 years
Payout During Waiting PeriodPremiums paid + 30% interestPremiums paid + 10% interestPremiums paid + 10% interestPremiums paid + 20% interestPremiums paid + 10% interest
Minimum Coverage$5,000$5,000$5,000$2,000$2,500
Maximum Coverage$25,000$25,000$25,000$25,000$15,000

Guaranteed Acceptance Life Insurance Carriers to Avoid

These companies aren’t necessarily bad, but we’d recommend starting your search for guaranteed acceptance insurance elsewhere. This is because the companies listed below have higher premiums, longer waiting periods and a smaller range of available death benefits.

AmericoColumbian FinancialColonial PennMassMutual
Age Availability50-7525-8050-8550-75
Waiting Period3 years3 years2 years2 years
Payout During Waiting PeriodPremiums paid plus 5% interest (Year 1), Premiums paid plus 10% interest (Year 2), 75% of death benefit (Year 3)Premiums paid + 6% interestPremiums paid + 7% interest annuallyPremiums paid + 10% interest
Minimum Coverage$2,000$2,500 ($5,000 if below 45)Approx. $400, varies by age$2,000
Maximum Coverage$10,000$25,000 ($10,000 if below 45)Approx. $17,000, varies by age$25,000

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