Guaranteed universal life is priced as pure death benefit. The premium is calculated to keep a no-lapse guarantee in force to a stated age, and almost none of it is meant to build cash value. That design produces a policy that looks like whole life on the outside and behaves nothing like it: surrender it and you may receive very little or nothing at all, even after paying premiums for twenty years. It also produces the single most fragile provision in retail life insurance, because the guarantee that makes the policy work can be weakened or lost by a payment that arrives late or short.
This page explains how the guarantee actually functions, what to check on a Farm Bureau Life policy that was sold as guaranteed coverage, and why this policy type draws serious attention in the life settlement market. Pine Lake Life Solutions is an independent educational resource, is not affiliated with or endorsed by Farm Bureau Life Insurance Company, and does not purchase policies.
In This Article
Check Whether You Actually Hold a Guaranteed Universal Policy
Companies change product shelves over time, and the label a policy was sold under is not always the label printed on the contract. As of July 2026 Farm Bureau Life’s consumer site describes three types of life insurance currently offered: term life, whole life and indexed universal life. It does not market a separately named guaranteed universal life product on that page. In practice, coverage that a household thinks of as its guaranteed policy is frequently an older universal life contract carrying a secondary guarantee, a no-lapse guarantee rider, or an endorsement to that effect.
So start with the policy schedule and the rider list rather than with memory. Look for language describing a secondary guarantee, a no-lapse guarantee period, a guarantee to a specific attained age, or a minimum monthly premium test. Those are the terms that determine everything else. If none of that language appears, you may hold an ordinary universal life contract with no guarantee at all, and the analysis is different. Call Farm Bureau Financial Services life and annuity client service at 800-247-4170, listed as available Monday through Friday 8:00 a.m. to 7:00 p.m. and Saturday 9:00 a.m. to 1:00 p.m. Central time, and ask them to state in writing which guarantee, if any, your policy carries and through what age.
How the No-Lapse Guarantee Can Be Lost
A secondary guarantee is a running test, not a promise attached to the policy at issue. The contract typically tracks a shadow or guarantee account funded by your premiums and reduced by charges. As long as that account stays above zero, the death benefit is guaranteed even if the ordinary account value falls to nothing. Pay late, pay less than required, take a loan or a withdrawal, or change the face amount, and the test can fail.
The part owners find hardest to accept is that failing the test is not always cured by simply resuming payments. Many contracts require a catch-up payment plus interest within a defined window to restore the guarantee, and some permit only a reduced guarantee period afterward. A guarantee that fails quietly can leave you holding a contract with almost no cash value and a rapidly rising cost of insurance, which is a far worse position than an ordinary universal life policy in the same circumstances. If you have ever paid late or skipped a payment, ask the company directly whether the guarantee is currently intact, and if not, what it would cost to restore it and by what date.
Why Surrendering a GUL Rarely Helps
Farm Bureau Life’s Policy Service Request, form 433-279 (01-23), includes a surrender section allowing a partial surrender or a full surrender, with the company’s liability ending on receipt other than payment of the net cash value. On a guaranteed universal contract, that net cash value is often the disappointing part. Because the premium was designed to buy guarantee rather than accumulation, the surrender value can be a small fraction of the premiums paid, and in later policy years it can approach zero by design.
The same form shows a nonforfeiture section for changing a policy to paid-up or extended term insurance, but those options depend on cash value existing in the first place. A guaranteed universal policy with negligible cash value has little to convert. That combination, a large guaranteed death benefit sitting on top of almost no surrender value, is exactly what makes this policy type worth analyzing carefully before letting it go.
| Event | Typical effect on a no-lapse guarantee |
|---|---|
| Premium paid after the due date | Guarantee test can fail; catch-up plus interest may be required |
| Premium paid short of the required amount | Shadow account falls behind; guarantee period may shorten |
| Policy loan taken | Commonly reduces or terminates the secondary guarantee |
| Partial withdrawal | Reduces the guarantee account and may void the guarantee |
| Face amount changed | Recalculates the required premium going forward |
| Payment mode changed | Can change the total annual premium needed to pass the test |
Why Settlement Buyers Look Closely at Guaranteed Universal Life
An institutional buyer in the life settlement market pays a lump sum, takes over premiums, and eventually collects the death benefit. Guaranteed universal life fits that model unusually well. The death benefit does not expire, the required premium is known and level rather than climbing unpredictably, and the seller’s alternative, surrender, is weak. When the insured’s health has declined since issue, the spread between what a buyer will pay and what surrender would produce can be substantial.
None of that is a promise. Eligibility depends on the insured’s age and current health, and no responsible party quotes a value before reviewing medical records and a current in-force ledger. It is also worth understanding that a buyer will price the policy on the minimum premium required to hold the guarantee, so any lapse in the guarantee reduces what the policy is worth to that buyer. Fixing or documenting the guarantee before any valuation is in your interest, not just the buyer’s.
The Company Behind the Guarantee
A guarantee is only as good as the insurer standing behind it, so the carrier’s condition is directly relevant here in a way it is not for a policy you intend to surrender. Farm Bureau Life Insurance Company operates from 5400 University Avenue, West Des Moines, Iowa 50266-5997 as the life subsidiary of FBL Financial Group, Inc. FBL Financial Group left the public markets on May 25, 2021, when Farm Bureau Property & Casualty Insurance Company completed a take-private transaction purchasing the outstanding Class A and Class B shares that it and the Iowa Farm Bureau Federation did not already own for $61.00 per share in cash. The shares were delisted from the New York Stock Exchange before the open on May 26, 2021, and the Iowa Farm Bureau Federation remained the majority owner. The in-force block was not sold to a third party, and the company continues to write new business.
AM Best has affirmed a Financial Strength Rating of A (Excellent) and a Long-Term Issuer Credit Rating of “a+” for Farm Bureau Life Insurance Company, with a “bbb+” Long-Term Issuer Credit Rating for FBL Financial Group, Inc., outlook stable. Confirm the current rating with AM Best or the company, since ratings are reviewed and can change. Note also that several unrelated insurers use the Farm Bureau name, including Southern Farm Bureau Life and the Michigan, Missouri, Kentucky, Indiana and Texas Farm Bureau companies; check the corporate name on your policy face page.
Transferring Ownership if You Do Sell
Any sale ends with a change of policy ownership. Farm Bureau Life processes this in Section 4 of form 433-279 (01-23), sent to the West Des Moines home office or faxed to 800-754-6370. The form states that any ownership change removes all existing owners and contingent owners, so anyone you want to keep must be re-affirmed. The new owner must sign, and a trust, corporation or other entity owner requires form 433-042 or 433-043 attached. Beneficiary changes use a separate form, 433-64, and requested changes take effect when recorded at the home office. If the contract cannot be found, the same form allows the company to issue a certificate of insurance for a $25 charge. Verify current forms with the company.
Time matters here in a way it does not with other policy types. If the guarantee is impaired and a catch-up window is running, both the repair and any transfer have to happen inside it. Establish the guarantee status in writing first, then decide.
Frequently Asked Questions
Does Farm Bureau Life still sell a guaranteed universal life product?
As of July 2026 the company’s consumer site lists three current life insurance types: term life, whole life and indexed universal life. It does not market a separately named guaranteed universal life product there. Coverage described as guaranteed is often an older universal life contract with a secondary or no-lapse guarantee. Check your policy schedule and confirm the specific guarantee with the company.
I paid a premium late. Is my guarantee gone?
Not necessarily, but it may be impaired. Secondary guarantees run on a continuing premium test, and many contracts allow the guarantee to be restored by a catch-up payment with interest within a defined window. Ask the company in writing whether the guarantee is currently in force, through what age, and what payment would restore it. Do not assume resuming normal payments is enough.
How much cash value does a guaranteed universal policy have?
Often very little, and by design. The premium is priced to fund a death benefit guarantee rather than accumulation, so the net surrender value can be a small fraction of premiums paid and can approach zero in later years. That is why surrendering a GUL is usually the weakest of the available options.
Why would a buyer prefer a GUL over other policy types?
Because the death benefit does not expire and the premium required to maintain it is known and level, which makes the future cost easier to price than a policy whose charges climb each year. That said, eligibility still depends on the insured’s age and health, and no offer or value can be promised before underwriting.
What does Farm Bureau Life require to transfer ownership?
Section 4 of the Policy Service Request, form 433-279 (01-23), handles a transfer of ownership. The new owner must sign, an entity owner requires form 433-042 or 433-043, and any ownership change removes all existing owners and contingent owners unless re-affirmed on the form. The company states changes take effect when recorded at its home office in West Des Moines.
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Related Reading
- Sell My Farm Bureau Life Universal Life Policy
- Sell My Farm Bureau Life Term Policy
- Life Insurance Grace Period Explained
- Carrier Hardship Programs
- How Life Settlement Value Is Calculated
- Keep Or Sell Policy Npv
- Sell My Protective Guaranteed Universal Policy
Pine Lake Life Solutions does not purchase life insurance policies and does not provide legal, tax, or investment advice. Information provided is for educational purposes only. Eligibility for any option, including life settlements, is not guaranteed and depends on individual circumstances, policy terms, underwriting, and market conditions. Consult independent legal, tax, or financial professionals before making decisions regarding a life insurance policy.