Guaranteed Issue Life Insurance Read this Before Buying

Don't get ripped off by paying for a guaranteed issue or simplified issue life insurance plan.  These whole life insurance policies have their place, but too many people who could qualify life insurance contracts that are both cheaper and better overpay for guaranteed issue final expense insurance contracts.

Guaranteed issue life insurance plans are optimal for only a small percentage of the population.  If you have a major health condition, you might not be approved for any other kind of plan.  Your health history might keep you from being approved for a standard life insurance contract.

However, this is not the case for most of us.  This is not even the case for most of us who are over 50.  Even if you have some medical issues, you are likely to be approved for a standard plan.

If you take prescribed drugs for hypertension or bone density issues, you might think that you won't qualify for a standard life insurance contract.  For most people this is not true. 

You could be charged more than someone who is healthier, but you will probably not pay nearly as much as you would if you applied for a guaranteed issue final expense insurance plan.

Guaranteed issue life insurance policies can cost you 2 times as much when compared to other plans.  This is not the only issue.  You will probably get a slower equity or cash value build up.  Your family will not receive the the full benefits if you pass away in the first two or three years after your effective date.

The equity or cash value of a final expense insurance contract is not the first thing most people think about when comparing plans.  Typically, people will compare the monthly costs and the face amount.  Many plans also build future loan value and this is an important part of many whole life insurance policies. 

Even if you don't plan to use the equity in your policy it can be used to keep your contract in force during hard times.  Many policies will allow you to use a portion of your cash value to keep the contract going when you are unable to make payments from your checking account.

Your beneficiary may not get what you expect them to get if you purchase a guaranteed issue or simplified issue life insurance plan.  Many of these contracts are modified benefit plans.  This typically means that if you die within two or three years after your contract's effective date only a fraction of the face amount is payable.  Your family might only receive the premiums paid plus a little interest.

The only reason to get a guaranteed issue policy is if you are convinced that you will not be approved for an underwritten life insurance plan.  Before buying a policy of this kind, be sure to apply to other policies to see what you are able to be approved for.

Avoid being one of the many people who will spend an arm and a leg for their final expense insurance plan.  Taking a medical exam or answering a few health questions can help you to pay much less.  Even if your application is rejected, you can apply for a guaranteed issue or simplified issue plan later so you have nothing to lose by applying for a less expensive plan first.