Guaranteed Term Life Insurance Policies - Are The Provisions Really Guaranteed?

Guaranteed term life insurance. One of the more loosely used terms when selling most any product is the word "guaranteed". Sometimes there is a measure of validity to it, sometimes not. Fortunately for the life insurance buyer the phrase "guaranteed term life insurance" is for real. When a life insurance company says that certain values are guaranteed they certainly are...

A life insurance company depends a great deal on reputation and as a result they try to write language in their policies that will stand up to any type of legal scrutiny.

Some of the provisions included in your guaranteed term life insurance policy are as follows:

  • A guaranteed level or decreasing death benefit. This depends on the type of policy chosen.

  • Guaranteed payment upon death, free of income taxes. As long as the law remains as it is this is one of the more attractive benefits of the so called "guaranteed term life insurance policies".

  • A guaranteed premium for a specific period of time. Some premiums increase after a certain number of years but even the increase is guaranteed.

  • Your term life insurance policy also guarantees that you can reinstate it should it end up in a state of lapse because of nonpayment of premiums. If your health changes you may need to prove insurability all over again. The policy must be reinstated within a certain period of time as stated in the contract itself.

  • Guaranteed term life insurance policies also cannot be taken away from you as long as you pay the premiums. If you own a 10 year term policy it can only be terminated by you within the 10 year period. The insurance company cannot terminate it.

  • Your guaranteed term life insurance policy assures you that if you should die by suicide within a certain number of years, usually two, the proceeds of the policy will be limited to the premiums paid plus interest. After the 2 year period if you should die a suicide the full death benefit will be paid. They force anyone thinking of this to wait at least 2 years. The result is that a person thinking of suicide usually changes his or her mind by that time.

  • If you should elect that your family receive an income instead of a lump sum your life insurance policy can also guarantee this income for life or for a specific period of time.

  • On the more personal side your life insurance policy can guarantee that your loved ones will always have food to eat, a roof over their heads and clothing to wear. The fact is that your term life insurance policy can guarantee that the lifestyles of the ones you leave behind will change very little, if any at all. This is the true power of your guaranteed term life insurance policy.

  • The businessman can be certain that if a key employee died suddenly the company could go on with their daily business without missing a beat. Your guaranteed term life insurance policy would be used as a kind of buffer while the company readjusts.

  • If a partner or stock holder of a business should die your life insurance policy can be used to provide sufficient cash to buy out the stock, or shares, from the survivors of the deceased. The business will go on and everyone will be aptly compensated.
Your guaranteed term life insurance policy can be an awesome tool. If you own such a policy, for the right amount, you can relax.

Take a look at how some guaranteed term life insurance policies work:

For more than 40 years Donald has been known for his extensive knowledge of the life insurance business. He has represented some of the largest and most admired life insurance companies in the United States as well as Canada. His advice is invaluable.

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