Do not confuse the guaranteed insurability
option with the Cost-Of-Living Adjustment (COLA) provision that most companies also offer in their AL policies.
(b) Guaranteed insurability
that provides options to purchase substantial additional coverage at specific times without evidence of insurability, subject only to showing that the insured's current income supports the increased coverage.
In their most common use, additional purchase options (APOs) or guaranteed insurability
options (GIOs) are attached to permanent policies on younger insureds.
Other features include the Waiver of Premium facility ('OwnOccupation' definition is preferred),non-smoker rates and the guaranteed insurability
options for such events as marriage, childbirth,moving house etc.
This can be accomplished by using the cash value or policy loans to buy as much term insurance as possible, perhaps through guaranteed insurability
and conversion clauses thoughtfully included in the policy, then augmenting the coverage further by making additional transfers of cash to the trust to pay premiums.
Some important considerations include a guaranteed insurability
option (usually only a small premium increase); stability, reputation and rating of the company; and how the cash value of your policy performs.
The notion is known in insurance parlance as "guaranteed insurability
." Guaranteed insurability
means that no matter what happens to your children, no matter what your child's health condition is at age 21 and again at age 28, the guaranteed insurability
option allows an increase in benefits without any physical examination.
For example, a Supplemental Coverage Rider can give clients the flexibility to add a lower cost layer of death benefit protection while a Guaranteed Insurability
Rider gives insureds the ability to increase death benefit coverage in the future.
* Guaranteed Insurability
: The insured retains the right to purchase additional benefits at a future date without providing more or new evidence of insurability.
Even the time-honored guaranteed insurability
option in life insurance is a change-it-up kind of feature.
The items that are of special importance when evaluating AL policies are the adjustment provisions and the commonly offered guaranteed insurability
This can be accomplished with either a guaranteed insurability
option or lengthy (20- to 30-year) policy terms.