What Is Guaranteed Universal Life Insurance?
This policy is somewhere in between term and whole life insurance, though the cash value is limited.
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Updated · 3 min read
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As a senior shopping for life insurance, you might hear about several different kinds of “guaranteed” life insurance. Guaranteed universal life insurance (GUL) can offer lifelong coverage and a way for your policy to build cash value, but it’s not the right fit for everyone.
While it’s more expensive than term life insurance, GUL is generally a cost-effective option for older people who are struggling to find life insurance to meet their needs.
» MORE: Types of life insurance
What is guaranteed universal life insurance?
Guaranteed universal life insurance (GUL) is a type of permanent life insurance that builds cash value over time and typically lasts your entire life. The death benefit paid out to beneficiaries is guaranteed as long as you’ve kept up with your premiums.
Guaranteed universal life insurance: Key facts
Costs Cheaper than whole life but pricier than term life.
Benefits Death benefit is guaranteed if premiums are paid.
Who it's for People who want lifelong coverage at a lower price.
How does guaranteed universal life insurance work?
Guaranteed universal life insurance strikes a balance between term life insurance and permanent options like whole life insurance.
Similar to whole life insurance, GUL can last until the end of your life. While guaranteed universal life insurance isn’t as affordable as term life insurance, it’s cheaper than whole life insurance. The cash value grows at a fixed rate set by the insurer, though the growth is slower compared to other types of permanent policies.
The “guarantee” in guaranteed universal life insurance refers to the death benefit. The payout to your beneficiaries is guaranteed as long as your premiums have been paid on time and in full. Other permanent policies like variable life insurance or indexed universal life insurance require a more hands-on approach to avoid a policy lapse, so they can be riskier or harder to manage.
How much GUL insurance can you get?
The coverage available for a GUL policy depends on the insurer, your age and how much life insurance you qualify for. Minimum policy amounts typically start at $50,000 and can go up to $1 million. However, some GUL policies cap coverage at lower amounts or require a higher minimum policy limit for older applicants.
How long does guaranteed universal life insurance last?
When you buy a GUL policy, you choose a “guarantee period” that lasts until a certain age — typically between 90 and 121. The policy remains in effect until the chosen age, so choosing 121 years could keep a guaranteed universal life insurance policy active for the rest of your life.
If you choose an earlier age, you may be able to extend the coverage before the policy expires. Keep in mind that the new premiums could be significantly more expensive.
Who is guaranteed universal life insurance for?
Guaranteed universal life insurance might be a good fit for seniors who are having trouble finding a life insurance policy. There are a few reasons these policies might be appealing to older adults.
$ Affordable permanent coverage. Life insurance rates are generally based on age and health, which means affordable life insurance for seniors can be hard to get. GUL policies have rates that are generally less expensive than whole life insurance. Term life insurance is the cheapest option on the market, but it’s often unavailable to people in their 80s. And whole life policies can get very expensive later in life.
👴 Accessible to older applicants. Guaranteed universal life policies can help fill gaps in life insurance availability. These policies are an option when term life is no longer available and are less expensive than a whole life policy for older adults. Issue ages for guaranteed universal life policies can reach into the 80s, extending coverage options for senior applicants.
Pros and cons of guaranteed universal life insurance
Pros
Coverage can last until the end of your life.
Lower premiums than whole life insurance.
Death benefit is guaranteed as long as you pay your premiums.
Cons
Cash value growth is limited.
Missed payments might cause the policy to lapse.
Application might require a medical exam.
How flexible is guaranteed universal life insurance?
Guaranteed universal life insurance offers a little bit of flexibility, which is part of its appeal.
Similar to other types of universal life, GUL lets policyholders adjust the coverage amount or payment frequency. However, to maintain the policy you’ll need to pay premiums in full by the due date.
Some policies also come with a return-of-premium rider. Life insurance riders can be added to a policy to customize coverage. A return-of-premium rider refunds all or some of the premiums you paid if you cancel the policy, usually within a specific window of time.
How much does guaranteed universal life insurance cost?
Guaranteed universal life insurance is less expensive than permanent life insurance coverage such as whole life because it doesn’t prioritize cash value growth. This may appeal to people looking for simple, lifelong, affordable life insurance. When compared with regular universal life insurance, guaranteed universal life premiums for older people are usually lower because the cash value growth is smaller.
Sample rates for GUL insurance
These monthly life insurance rates are based on a $100,000 guaranteed universal life insurance policy for preferred applicants in good health.
| Issue age | Average monthly rates for men | Average monthly rates for women |
|---|---|---|
| 40 | $62.59 | $54.37 |
| 50 | $92.70 | $81.43 |
| 60 | $150.40 | $137.06 |
| 70 | $275.40 | $238.10 |
| 80 | $559.00 | $480.00 |
| Source: LifeStein.com. Lowest three rates for each age averaged. Data valid as of March 26, 2026, and rates are subject to change. | ||
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Guaranteed universal life insurance vs. whole life insurance
The biggest question when choosing between guaranteed and whole life insurance is whether you’re willing to pay more in premiums to build cash value that you can borrow against later.
In addition to lower premium costs, here’s how some of the features of guaranteed universal life insurance stack up against whole life insurance.
| Guaranteed universal life | Whole life | |
|---|---|---|
| Coverage length | Lifetime. | Lifetime. |
| Builds cash value | Minimal. 1% to 3% guaranteed annual rate of return. | Yes. 1% to 4% guaranteed annual rate of return. |
| Death benefit | Guaranteed amount. | Guaranteed amount. |
| Cost of premiums | More affordable than whole life. | More expensive than guaranteed universal life. |
Is guaranteed universal life insurance worth it?
Choosing the right type of life insurance comes down to your individual needs. Ask yourself why you need coverage. Term life insurance is typically sufficient for young people who are looking to lock down coverage, as well as most families.
However, if you want a lower-cost coverage solution that is likely to last a lifetime, and cash value growth isn't a priority, guaranteed universal life may be worth considering.
🤓 Nerdy Tip
Keep in mind the “guarantee” in GUL refers only to the fixed death benefit, not to whether you are guaranteed to be approved. For seniors or older adults with health concerns, it may be easier to apply for guaranteed issue life insurance. Sometimes referred to as burial insurance, these policies have lower coverage limits but you won’t have to take a medical exam. » MORE: Life insurance policies
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Frequently Asked Questions
Are guaranteed universal life insurance and guaranteed issue life insurance the same thing?
Despite the similarity in names, guaranteed universal life insurance isn’t the same as guaranteed issue life insurance, which is a small policy you can buy without answering health questions or taking a medical exam.
What’s the difference between guaranteed universal life insurance and universal life insurance?
While both types of life insurance have flexible coverage options, the biggest difference between guaranteed universal life (GUL) and variable universal life (VUL) insurance is the way the policy’s cash value grows.
In GUL, the cash value growth is modest and grows at a fixed rate set by the insurer. In VUL policies, the cash value growth can have greater risk and greater potential rewards because it’s tied to stock market or bond index performance.
Can people over 70 get a guaranteed universal life insurance policy?
Yes. Because guaranteed universal life insurance has lower premiums than whole life insurance while still offering long-term coverage, it can be a good option for older people who don’t want to use life insurance to build cash value.
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