Guaranteed Issue Life Insurance?

Everyone has seen this type of insurance advertised in commercials on TV or the radio. You may have even seen a flyer advertising this type of insurance. You know the ones that say “No medical exams and no medical questions!” But what does it guarantee?

It sounds a little too good to be true does it not? Well, guaranteed life insurance is aimed mostly at senior citizens or people with medical problems. In addition, you usually cannot get coverage for more than $20,000. On top of that, the premium tends to be higher because there is no medical exam or information required. They usually even have a two-year death benefit penalty, which means that if you die in the first two years of having the policy all your beneficiaries get back is the premiums plus interest.

On average, people end up paying more in premiums than their beneficiaries see in benefits. This is not a good thing. State insurance regulators and the National Association of Insurance Commissioners (NAIC) have started paying attention to this type of policy. A working group has been established to see what kinds of actions should be taken against companies selling these policies and what can stop them from taking advantage of people.

This is a delicate situation and the NICA must be careful in what they do and say because it could be taken as a form of rate regulation and that is not what they are prepared to do.

It is more cost effective to purchase a policy with rates that are based on your age and medical information. You will probably pay less and get better coverage. Therefore, if you are interested in getting the best whole life insurance quotes, term life insurance quotes or the best universal life insurance quotes you need to be careful. Do the research and ask questions before you make your final choice.

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