How does Guarantee Life Insurance work in 2024?

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Patrik Shore updated on 29 November 2023

If you or someone you know has been denied life insurance it could be due to age, underlying health conditions, occupation, or any number of reasons. Whatever the grounds, the fundamental issue would be that the concerned is considered too risky for coverage. 

This is where guaranteed life insurance comes in. As in the name, this guaranteed life insurance guarantees coverage regardless of your personal circumstances. Any eligible individual can apply for no medical life insurance and receive immediate coverage. 

But how does guarantee life insurance work and why would such policies exist? This article covers guaranteed life insurance in-depth and explains who it’s for and how it works. Use our comparator to compare the best guarantee life insurance policies and get free quotes in seconds.

Guarantee Life Insurance: 5 Key takeways

  1. Death benefits are usually limited to $5,000 increments from $5,000 to $50,000
  2. Approval is guaranteed without any medical exam
  3. Premiums are usually more expensive than traditional life insurance
  4. Rates are locked in, ensuring consistency and reliability
  5. Coverage is for life, providing prolonged security

What is guaranteed life insurance?

Guaranteed life insurance, also known as no medical life insurance, is a form of permanent life insurance that ensures coverage to any eligible applicant. Without having to undergo a medical examination or complete a lengthy health questionnaire, anyone can apply for and receive immediate life insurance coverage. 

Just like the name suggests, guarantee life insurance is guaranteed. You will not be denied coverage due to health conditions or your occupation like you might with traditional term life insurance and permanent life insurance policies. This makes guaranteed life insurance an attractive alternative for anyone who has had trouble getting accepted for life insurance in the past. 

Before we get into further details, you can quickly explore the best guaranteed life insurance policies in Canada and get free quotes right here. Use our comparator below and get results in no time.

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How much does guaranteed life insurance cost?

Guaranteed life insurance costs are usually more expensive than traditional policies because the insurance providers take on a higher level of risk by providing coverage without assessing medical history. However, the convenience and accessibility of guaranteed life insurance often outweigh the higher cost for those who aren’t eligible for full medical underwriting life insurance.

The table below provides an indication of the monthly cost of guaranteed life insurance in Canada for 50-year-old, non-smoking females and males over a range of coverage from $5,000-$25,000.

Death BenefitFemaleMale
$5,000
$14.37$17.71
$10,000
$28.75$35.42
$15,000
$43.12$53.13
$20,000
$57.50$70.83
$25,000
$71.87$88.54
TD Guaranteed Acceptance Life Insurance costs

How does guaranteed life insurance work?

Unlike term life insurance and whole life insurance, guaranteed life insurance provides individuals with coverage regardless of their health or medical history. In most instances, life insurers won’t even review your medical history or prescription records and the guaranteed life insurance policy will last your entire lifetime.

Here’s how it works:

  1. No medical exam: guaranteed life insurance policies are guaranteed because they don’t require any medical exam or completion of lengthy health questionnaires. This means that anyone with pre-existing health conditions can still get life insurance without worrying about being declined coverage.
  2. Simplified application process: the application process for guarantee life insurance is often very straightforward. It usually only involves completing a basic application form with some personal details.
  3. Guaranteed approval: as long as you meet the insurer’s eligibility on age requirements and residence, you are guaranteed to be approved for the life insurance policy. Additionally, since there is no underwriting policy you will receive permanent coverage immediately.
  4. Limited coverage amounts: since guarantee life insurance offers coverage with no medical questions, they have to have lower death benefits than normal life insurance. The maximum guaranteed life insurance death benefit is usually capped at $50,000.
  5. Higher premiums: similar to the reason for the lower coverage limits, guaranteed life insurance typically also comes with higher premiums to cover higher at-risk individuals.
  6. Waiting periods: it’s normal for guaranteed life insurance to come with waiting periods of up to two years before the death benefit would be paid out in full. However, if the insured does pass away in the waiting period the insurer will likely pay their benefits a return of the premiums paid.
  7. Permanent coverage: guaranteed no medical life insurance policies are usually a form of permanent life insurance, meaning that as long as premiums are paid the insured individual will be covered for life.

What does no medical life insurance cover?

Guaranteed no medical life insurance covers everything that a traditional life insurance policy would cover. It provides a guaranteed death benefit to your life insurance beneficiaries should you pass away from any illness or injury. This includes death from:

  • Chronic conditions
  • Acute illnesses
  • Accidental death
  • Natural causes
  • Suicide (subject to the waiting period)

Since the policy usually has a limited death benefit, no medical life insurance isn't designed to provide your dependents with generational wealth or long-term financial aid. Instead, guaranteed life insurance should be considered to provide your loved ones with support in paying for any final expenses that may come about from your passing. 

However, if you have applied for the maximum death benefit, the death benefit may be enough to also cover any personal loans and limited outstanding debt.

If you’re unsure if the maximum guaranteed life insurance death benefit is sufficient for your needs, you can use HelloSafe’s free comparator below to review other insurance options from over 20 of the best life insurance providers in Canada. Get personalized quotes right here in seconds.

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What are the benefits of guaranteed life insurance?

One of the main benefits of guaranteed life insurance is its availability to individuals with prior medical history. Unlike traditional policies that have extensive medical questionnaires and require you to disclose any and all pre-existing conditions that may make you ineligible for coverage, guaranteed life insurance has no such requirements. This means that individuals with chronic illnesses, such as diabetes or heart conditions, can still obtain life insurance coverage.

Advantages of guaranteed life insurance

  • Requires no medical examination
  • Do not have to complete a lengthy health questionnaire
  • Guaranteed death benefit
  • Guaranteed premium rates
  • Coverage for life
  • Often available for individuals up to age 85 (depending on the provider)
  • Immediate coverage upon acceptance

Disadvantages of guaranteed life insurance

Despite the benefits of no medical life insurance, it is important to know that guaranteed life insurance policies do come with a few drawbacks. These usually include:

  • Lower overall death benefit coverage
  • Higher premiums
  • Two-year waiting periods on death from anything other than an accident

Who needs guaranteed life insurance? 

Some people may be under the misconception that guarantee life insurance is only for senior citizens. However, guaranteed life insurance is equally as advantageous to anyone who has prior medical conditions that make it difficult for them to get accepted for a traditional life insurance policy.

By having guaranteed coverage and a death benefit, however small, anyone with a no medical life insurance policy can ensure that final expenses and debts do not fall upon their loved ones. Additionally, the death benefit may be enough to leave a small legacy to children and grandchildren.

Guaranteed life insurance is therefore perfect for anyone who:

  • Has a medical condition making it impossible to buy traditional life insurance
  • Have medical conditions that make traditional life insurance unaffordable
  • Are looking for a limited death benefit to cover limited final expenses
  • Want to ensure a small legacy is left for their loved ones

If you do not fall into the typical categories of those who need guaranteed life insurance, then there are other options that you should consider, such as term life insurance and whole life insurance. While these options do require you to complete a medical examination and extensive health questionnaires, they do provide more extensive coverage and come with a cheaper premium.

You can use our comparator below to find out the best life insurance options for you based on your unique situation and needs. Get over 20 free personalized quotes in seconds.

Compare the best life insurance companies

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Is guaranteed life insurance worth it?

Guaranteed life insurance is an expensive form of life insurance but it is generally considered worth it for anyone who is not eligible for normal life insurance. The idea of no medical cover is to ensure that some money, however little, is provided to loved ones at the time of passing. 

Therefore, guaranteed life insurance is worth it for anyone wishing to:

  • Leave enough money to pay for burial or cremation
  • Pay for the funeral service and bereavement
  • Provide some money to help pay off smaller debts and personal loans
  • Cover costs of remaining medical bills
  • Provide a small inheritance for children or grandchildren

Guaranteed life insurance vs traditional life insurance

Guaranteed life insurance policies are perfect for individuals who are ineligible for traditional life insurance policies, or for those who simply want a small death benefit without going through full medical underwriting.

As we’ve covered, guaranteed no medical life insurance provides individuals with easy coverage with minimal effort, but with a slightly higher premium rate and lower maximum coverage than other life insurance policies. So let’s take a look at a few reasons why you might want to consider a traditional life insurance policy over guaranteed life insurance.

Term Life insurance

Term life insurance is perfect for anyone wanting high coverage at the lowest possible price. It is ideal for younger couples just starting out who want to ensure that their loved ones can maintain their current lifestyle should the worst happen. Term life insurance is the best way to replace an income in full for several years, while still saving money on premiums. Compared to guarantee life insurance, term life insurance is cheaper because you undergo full medical underwriting and the maximum coverage can go all the way up to $20m.

Whole Life insurance

Whole life insurance is the ideal policy for anyone wanting to get life insurance protection for their entire lives and incorporate a savings element. Similar to guaranteed no medical insurance, a whole life insurance policyholder will never have to renew their life insurance but the coverage they can apply for is significantly higher. Additionally, individuals can apply for whole life insurance much earlier in their lives, meaning they can lock in premiums at a lower rate.

How do you apply for guaranteed life insurance?

Guaranteed life insurance is the easiest policy to apply for because it is guaranteed. It does not require a lengthy review process so as long as you are eligible, you will receive coverage. The first step is to find a reputable insurance provider in your region that offers this type of policy. You will then need to submit an application form to your chosen provider and provide personal information such as your:

  • Age
  • Gender
  • Address and telephone number
  • Residential status
  • Smoking status
  • Beneficiaries
  • Requested death benefit

Unlike traditional life insurance policies, guaranteed life insurance does not require a medical exam, so the application process is often much faster and simpler. Therefore, once you submit your application the insurance provider will only have to review your information and determine your eligibility for coverage before issuing your policy.

Eligibility requirements are usually only confined to:

  • Age
  • Residential status

Due to its simplicity, most insurance providers that offer guaranteed life cover allow you to apply directly via their websites. Online life insurance applications make applying for life insurance much easier and provide you with the ability to get immediate coverage.

What is the best guaranteed life insurance in Canada?

Due to the increased risk, guaranteed issue life insurance policies are normally only issued by the biggest and best life insurance providers in Canada.

The table below shows a list of the best life insurance providers in Canada that offer guaranteed no medical life insurance.

Insurance providerRBC InsuranceManulifeSun Life
Policy name
RBC Guaranteed Acceptance Life InsuranceCoverMe® Guaranteed Issue life insuranceSun Life Go Guaranteed Life Insurance
Eligibility
Canadian citizens
Permanent residents/landed immigrants
Ages 40 to 75
Canadian residents
Ages 40 to 75
Legal Canadian residents
Ages 30-74
Coverage limits
$5,000 to $40,000 (in $5,000 increments)$5,000 to $25,000 (in $5,000 increments)$5,000 to $25,000 (in $5,000 increments)
Accidental death benefit
If death is due to an accident before age 85, beneficiaries will receive five times the basic coverageAn additional 4x the amount of your death benefit before the age of 85
Waiting period
Two years' waiting period unless you die as a result of an accidentTwo years suicide waiting period Two years, if you die for any reason
other than an accident
Best life insurance providers in Canada offering guaranteed life insurance.
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Patrik Shore Ex: web developer
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Patrik Shore has nearly a decade worth of experience in the financial industry and has been writing for HelloSafe over the past year. Having started his career investigating financial crime to moving on to financial planning, Patrik has a deep understanding of all things personal finance.

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