
You've seen guaranteed-issue life advertised on cable TV and in AAA and AARP magazines. The ads promise that you won't be turned down, regardless of your health.
But if you're looking for a quick net-worth boost at death's door or a last-minute cash windfall for your heirs, you're unlikely to find it in a guaranteed-issue product.
"For the first two years, the death benefits are minimal," Hasenauer says. "That two-year window is the suicide period, the contestability window where the company would contest that the information you provided was not correct."
Then the benefits step up, but not by a lot. "They're not very big policies; you could never go and get a good estate planning-type policy," she says. "They're pretty close to burial-type policies -- just enough to get you in the ground and pay the minister."
The cost of these policies reflects their increased risk to the insurer. "They're crazy expensive," says Steuer, who's also the director of financial preparedness for the insurance consumer group United Policyholders.
If you're considering a guaranteed-issue product, Hasenauer recommends shopping around.
"There is a (price and benefit) difference between the three-question and the 10-question policy applications," she says.