Life Insurance✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
Guaranteed universal life (GUL) insurance is best characterized by which of the following?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Guaranteed universal life is a form of universal life whose central feature is a guaranteed death benefit maintained by level premiums payable for life or until a stated age, with cash value that is typically minimal or designed to be exhausted. It is priced between traditional term and full cash-value permanent coverage and is often used where the client wants permanent protection at a lower premium than whole life.
Why the other options are wrong
- B) Indexed universal life (IUL) credits interest based on an index such as the S&P 500; GUL is not indexed.
- C) GUL is usually paid with level premiums over a period of years, not a single premium.
- D) GUL makes no guaranteed 5% cash-value promise; its distinguishing feature is the guaranteed death benefit, not a guaranteed cash-value rate.
Memory hook
GUL = permanent protection with the term-like price tag. The death benefit is the star; the cash value is barely a prop.