What is Guaranteed Universal Life Insurance (GUL)?

Thang Truong
Thang Truong
Updated on:

If you want the ultimate in stability with your life insurance, then you’ll want to look into guaranteed universal life insurance. These types of plans offer the most stability for your beneficiaries after death. Below we’ll look more into what this type of insurance is and who should consider it.

What is Guaranteed Universal Life Insurance? 

Unlike indexed universal life insurance or variable universal life insurance, you do not use this type of life insurance to invest or link to stock market performance for added cash value. So if you’re not interested in investing, this might be the plan for you.

This type of plan offers a guaranteed death benefit. A guaranteed death benefit simply means that one fixed amount will go to your beneficiaries upon your death. You often don’t have the option to adjust your premiums. You simply pay a set premium to maintain coverage for as long as you’d like. This aspect is similar to term life insurance, fixed premiums and guaranteed coverage amount, which is also the same as death benefit in this case since there is no cash value account.

However, it is different from term life insurance is that in term life insurance, your beneficiaries only receive death benefit if you pass away during the term. On the other hand, your beneficiaries in guaranteed universal life insurance will receive death benefits as long as your policy is still in force when you pass away. It’s a type of permanent life insurance

>>MORE: Case Studies of Universal Life Insurance

Common Product Features of Guaranteed Universal Life Insurance

Some of the product features at a glance include:

  • An option where you have the most permanent coverage with the lowest premium possible. Similar to whole life insurance, guaranteed universal life insurance offers guaranteed permanent coverage or face value or death benefit; however, at a much cheaper price. In fact, when we compare the quotes of the two policies, guaranteed universal life insurance cost is less than 40% of whole life policy’s cost.
  • A situation where your death benefit and premium are fixed, leading to less temptation to pull value out of the policy
  • Riders that still allow for use of benefit money while still alive in certain situations

These policies give the greatest amount of stability out of the permanent life insurance types.

>>MORE: How Much does $2 Million Guaranteed Universal Life Insurance Policy Cost?

Guaranteed Universal Life Insurance Riders 

You may also see certain riders that are common with guaranteed universal life insurance.  Some of the common ones include:

  • Accelerated Death Benefit Long-Term Care Rider: A cash indemnity payout that helps with care payments, even informal care while staying in your home. Learn more about living benefits of life insurance.
  • Accelerated Death Benefit for Terminal Illness Rider: Access to a portion of your death benefit if you have a terminal illness
  • Accidental Death Benefit Rider: Your beneficiaries get more money in addition to your death benefit if the death was an accident. Learn more about accidental death life insurance.
  • Children’s Term Insurance Rider: You get a life insurance benefit if your child passes away
  • Long-Term Care Rider: Your death benefit can pay for long-term care
  • Waiver of Monthly Deductions Rider: Pays for all monthly deductions if you’re disabled, a waiting period may apply

Riders can vary by which company you are going through and some may be available in different states. It’s important to discuss the option of riders with an insurance agent.

>>MORE: How Much does a $5 Million Guaranteed Universal Life Insurance Policy Cost?

Pros and Cons of Guaranteed Universal Life Insurance

To help you decide if this policy is right for you, below we’ve outlined the pros and cons in an easy-to-understand manner.


  • Guaranteed universal life insurance is great for people who want to maximize their coverage amount only.
  • These policies are good for people who want more simplicity in their plan. You basically pay your premiums and let it ride.   
  • The fixed, guaranteed death benefit allows for peace of mind.
  • Some plans allow for a buy-sell agreement that can help protect your business.
  • You can still access cash from the policy while living, often through riders.

>>MORE: Is Guaranteed Universal Life Insurance Worth It?


  • You don’t have the option of cash value growth: what you pay into the plan and the benefit you receive is it.
  • There is no cash value account in this policy. If you expect to have access to cash value to supplement your retirement income, this is not for you.
  • If you like the idea of flexible premiums and benefits, this plan may not be a strong choice. 

>>MORE: Compare Whole Life Insurance With Guaranteed Universal Life Insurance

Whom is It For? 

Guaranteed universal life insurance tends to be for people who prefer ultimate stability and they don’t plan to take cash from while still alive.  A guaranteed universal life insurance policy is best if you like the stability of knowing that the plan has a guaranteed death benefit in place.  

>>MORE: Guaranteed Universal Life Insurance for Seniors: A Good Choice?

How Much Does Guaranteed Universal Life Insurance Cost? 

We get an illustration of a policy for a man who started the policy at 45 years old. His initial death benefit is $150,000 and his initial monthly premium is $115.52. Compared to indexed universal life insurance and whole life insurance, which can provide similar coverage benefits, the premium for guaranteed life insurance is significantly cheaper.

However, his death benefit stays at $150,000 throughout the policy and his premium stays at $1,386.24 annually. The account value fluctuates slightly, going from $226 in the first year to $1,766 in the 12th year. Then it steadily drops to $0 in the 20th year and beyond. Surrender value sits at $0 for most years, which is the amount available if you let go of the policy.

You can see how the general purpose of these plans is to have a stable death benefit and premium with the lowest premium payments possible.  

[elementor-template id=”2957″]

>>MORE: Understanding How Guaranteed Universal Life Insurance Works

Final Thoughts

If you like the idea of one fixed death benefit for a set amount in premium payments, guaranteed universal life insurance is a solid policy type to look into. You can’t increase cash value through investments or market performance, and it’s harder to withdraw cash from the policy. However, if you plan to use a life insurance policy for the more traditional purpose of a fixed death benefit, this is a solid option.

Thang Truong
Thang Truong

Thang Truong covers small business insurance and small business success at BravoPolicy. He is a licensed P&C insurance agent. Previously, he held product leadership positions at realtor.com, Capital One, NerdWallet, and Mulberry Technology. He holds a MBA degree from UC Berkeley - Haas School of Business.

More Stories

6 Best Indexed Universal Life Insurance (IUL) for 2023

Are you looking for a way to set aside some extra money for your senior years, and maybe a little extra for loved ones to inherit? Most people opt for indexed universal life insurance because it offers the greatest cash value growth tied to the performance of S&P 500 index with the least risk thanks […]

Thang Truong
Thang Truong

Best Self-Directed Roth IRA Companies for 2023

A self-directed Roth IRA is much like a regular Roth IRA, but offers more flexibility as far as what you can invest in. Whereas a regular Roth will only let you invest in stocks, bonds, mutual funds, ETFs, and real-estate investment trusts, a self-directed Roth lets you invest in a greater variety of investment options.  […]

Thang Truong
Thang Truong

The 5 Best Hybrid Long-Term Care Insurance Companies for 2023

If you’ve decided to plan for every eventuality, you’d be smart to include a plan to cover long-term care. Someone turning 65 this year has an almost 70% chance of needing some type of long-term care, and about 13% of those will need it for five years or more. Long-term care is expensive and can […]

Thang Truong
Thang Truong

The 3 Best Traditional Long-Term Care Insurance Companies for 2023

Long term care is something that no one likes to think about, but unfortunately, many people will eventually need. Health care costs are skyrocketing, and a lengthy stay at a long-term care facility can easily bankrupt most people’s nest eggs. Long-term care insurance is one way to protect both yourself and your retirement savings. Out […]

Thang Truong
Thang Truong

The Best Long-Term Care Insurance Companies in California for 2023

California residents who are keen to protect themselves and their families against the worst events in life may be considering long-term care insurance. However, you might not know much about LTC insurance or how it is handled in California. Let’s take a look: What is Long-Term Care Insurance? Long-term care insurance helps pay for long-term […]

Thang Truong
Thang Truong

The Best Long-Term Care Insurance Companies in Arizona for 2023

Arizona is a great place to retire. It’s warm, there’s no snow to shovel, and Arizona improves the quality of life for anyone with allergies or asthma. When you pack your bags and retire to Arizona, you’re probably not thinking about long-term care. But the sad reality is that 47% of men and 58% of […]

Thang Truong
Thang Truong

The Best Long-Term Care Insurance Companies in Florida for 2023

There’s a lot of good reasons to retire in Florida. The weather is warm, the beaches are beautiful, and there are lots of other retirees to socialize with. Also, Florida has no state income taxes, no inheritance taxes, and no estate taxes. When you pack up your things and move to Florida, you’re probably not […]

Thang Truong
Thang Truong

Private Placement Life Insurance: Everything You Need to Know

If you haven’t heard of private placement life insurance, you probably don’t qualify to buy it. Private placement life insurance is typically for investors with millions in liquid cash that they need to invest for tax reasons.  What is Private Placement Life Insurance? Who Qualifies for Private Placement Life Insurance? Benefits of Private Placement Life […]

Thang Truong
Thang Truong

Nationwide IUL – A Strong Product With Great Features and Excellent Ratings

The Nationwide IUL product can help you either supplement your retirement income or ensure your beneficiaries future by leaving them a nice tax-free death benefit. Obviously, you have many options when it comes to IUL policies, so you want to know how does Nationwide’s policy stack up against the competition? Let’s take a look. Pros […]

Thang Truong
Thang Truong

Transamerica IUL – A Solid Product but High Consumer Complaint Score & Law Suits

Consumers looking to supplement their retirement income often settle on an indexed life insurance policy. These policies build cash value based on market performance and allow your heirs to enjoy a tax-free death benefit. Let’s take a look at Transamerica’s indexed universal life insurance policy and see what makes it stand apart from other such […]

Thang Truong
Thang Truong