Guaranteed universal life is built on a trade. You give up cash value in exchange for a guaranteed death benefit at the lowest possible premium. That trade works beautifully as long as the premium is paid exactly as scheduled, and it becomes very unforgiving the moment it is not. Most GUL contracts hold little or no cash surrender value, so an owner who falls behind has no cushion, and the no-lapse guarantee that makes the whole product function can be shortened or lost by a payment that arrives late.
If you own a North American Company for Life and Health guaranteed universal life policy and the premium has become difficult, the worst thing you can do is quietly stop paying and sort it out later. This page explains how the guarantee is tested, what catch-up provisions can and cannot repair, and how a settlement fits alongside the other alternatives. Pine Lake Life Solutions is not affiliated with, endorsed by, or connected to North American Company for Life and Health Insurance or Sammons Financial Group. Pine Lake does not purchase policies and offers only a free, no-obligation policy review.
In This Article
The Guarantee Depends on Timing, Not Just Amount
A no-lapse guarantee, sometimes called a secondary guarantee, keeps the policy in force even if the account value falls to zero, so long as a specified premium condition has been met. The condition is tested in one of two ways, and both are time-sensitive.
Under a cumulative premium test, the carrier compares the premium you have actually paid, weighted by when each payment arrived, against the schedule the guarantee requires as of that date. Under a shadow account, the carrier maintains a separate notional ledger credited and charged at rates defined in the contract, and the guarantee holds while that ledger stays positive. Neither figure is the account value shown on your annual statement, which is why owners are often unaware that the guarantee has weakened.
North American’s guaranteed universal life products are structured around meeting the required no-lapse guarantee premium, and product summaries note that on some designs the early policy years are especially strict about missed payments. Late money is worth less than on-time money under a time-weighted test, and the shortfall carries forward, shortening the guarantee. Ask North American to explain the test that applies to your policy form.
Catch-Up Provisions: The Limits of the Repair
Many GUL contracts include a catch-up feature that lets an owner restore a diminished guarantee by paying the shortfall plus an interest adjustment, usually within a defined window. Whether that feature exists on your policy, how long the window runs, and what the adjustment costs are all determined by your policy form rather than by general practice.
What a catch-up generally cannot repair is a policy that has already lapsed and passed its reinstatement period. At that stage you are asking the carrier to reinstate coverage, which typically requires evidence of insurability, payment of back premium with interest, and carrier approval. If health has declined in the interim, reinstatement may simply be unavailable, and the guarantee is gone with it.
Act while the guarantee is intact. A GUL policy with a clean premium history is worth more to a buyer than the same policy with a compromised guarantee, because the buyer is purchasing the guarantee itself. Eligibility for any settlement is never guaranteed regardless of payment history.
Why Surrendering a GUL Policy Rarely Helps
Owners coming from whole life expect a meaningful surrender check. On guaranteed universal life there usually is not one. GUL is engineered to deliver a guaranteed death benefit at the lowest sustainable premium, and carriers achieve that by holding minimal cash value inside the contract. Many GUL policies carry a surrender value at or near zero for most of their duration.
So the nonforfeiture toolkit that helps a whole life owner is generally not available. The realistic choices narrow to four: keep funding the guarantee, reduce the face amount so the required premium falls, let the policy lapse and receive nothing, or seek a life settlement.
Reducing the face amount deserves more attention than it gets. Because the guaranteed premium scales with the death benefit, cutting the face amount can bring a policy back within reach and preserve a guarantee for life. Ask the carrier what the no-lapse premium would be at several reduced face amounts before concluding the policy must go.
| Action | Effect on the no-lapse guarantee | Typical fix |
|---|---|---|
| Premium paid on schedule | Guarantee runs as illustrated | None required |
| Premium paid late | Time-weighted shortfall shortens the guarantee period | Catch-up plus interest adjustment, if the policy form allows |
| Premium skipped entirely | Guarantee may terminate even while coverage briefly continues | Catch-up within the contract window, or reduce the face amount |
| Policy lapses | Guarantee and coverage both end | Reinstatement, usually requiring evidence of insurability and back premium |
The Company Standing Behind the Guarantee
A guaranteed universal life policy is a promise that may not be called on for thirty years, so the carrier’s condition and continuity matter more than on almost any other product.
North American Company for Life and Health Insurance was founded in 1886 as the North American Accident Association in Chicago. A.E. Forest bought the company for two thousand dollars in 1890, and in 1918 it became the first company to offer disability insurance for women. It entered the brokerage marketplace in 1981 and was acquired by Sammons in 1996. The company redomesticated to Iowa on September 27, 2007, with the stated purpose of simplifying regulatory compliance across the holding company system by using a common regulator for the company and its affiliates and reducing current and future tax costs tied to anticipated annuity growth. It is regulated by the Iowa Insurance Division under NAIC company code 66974.
The company is not in runoff and continues to issue new individual life insurance and annuities through independent financial professionals. AM Best affirmed a Financial Strength Rating of A+ (Superior) and a Long-Term Issuer Credit Rating of aa- on August 13, 2025 with a stable outlook, the second highest of fifteen categories. S&P affirmed A+ (Strong) on May 15, 2025 and Fitch assigned A+ stable on June 17, 2025. North American reported more than 463,000 life policies in force as of December 31, 2024 and paid over 547 million dollars in life death claims during 2024. Confirm current figures with the carrier.
What to Ask Before You Miss a Payment
If cash flow is the pressure point, make one call before changing anything. Reach North American’s life insurance service line at 877-872-0757, or 712-847-1334 internationally, Monday through Thursday 7:30 a.m. to 5:00 p.m. or Friday 7:30 a.m. to 12:30 p.m. Central time.
Ask through what date the no-lapse guarantee is currently satisfied given your actual payment history. Ask what premium would extend the guarantee to a specific target age such as 95 or 100. Ask whether a catch-up provision exists on your policy form, what window applies, and what interest adjustment is charged. Ask what the required guaranteed premium would be at reduced face amounts. Ask what the current cash surrender value is, so you know whether surrender returns anything.
Request written confirmation rather than relying on a call note; correspondence goes to One Sammons Plaza, Sioux Falls, SD 57193. Those five answers describe your position better than any general guidance, including this page.
If You Sell: Recording the Ownership Change
A settlement is finalized at the carrier. North American must record the change of ownership, and in many structures an absolute assignment, on its own books before the transaction is complete, and escrowed funds are typically released only after that recording is confirmed in writing.
Obtain the current ownership change and assignment forms from North American directly. The company publishes service forms on its own website, including an Address and Name Change Request form, and the life service team can identify the correct versions for your policy form number. Superseded forms from third-party sites are a routine source of delay. If a trust is the owner or sits on either side of the transfer, expect trust certification documentation as well.
Because GUL policies are valued largely on the strength of the guarantee, buyers will also request carrier confirmation of the guarantee status and the premium required to maintain it. Having that ready shortens the process. Pine Lake does not purchase policies and does not provide legal, tax, or investment advice.
Frequently Asked Questions
Can one late premium really damage a no-lapse guarantee?
Yes, it can shorten it. Most guarantees are tested against a time-weighted cumulative premium requirement or a shadow account, so a payment made late counts for less than the same payment made on schedule and the shortfall carries forward. Ask North American through what date your guarantee is currently satisfied based on your actual payment history, and get the answer in writing.
How much cash would I get if I surrendered a GUL policy?
Often very little, and sometimes nothing at all. Guaranteed universal life is designed to deliver a guaranteed death benefit at the lowest premium, which means it holds minimal cash value by construction. That is the central reason GUL owners facing an affordability problem look at reducing the face amount or at a life settlement rather than at surrender.
Do buyers want guaranteed universal life policies?
GUL is among the policy types most frequently evaluated in the secondary market, because a contractually guaranteed death benefit with a defined premium schedule makes the cost of carrying the policy predictable. That does not mean an offer is assured. The insured’s age and health, the guaranteed premium relative to the death benefit, and the condition of the guarantee all matter, and eligibility is never guaranteed.
Is North American still an active carrier, or is my policy in runoff?
North American continues to issue new individual life insurance and annuities through independent financial professionals as a member company of Sammons Financial Group and is not in runoff as of 2026. It redomesticated to Iowa on September 27, 2007 and is regulated by the Iowa Insurance Division under NAIC company code 66974.
What is the single most useful thing I can do this week?
Call the carrier and get two figures in writing: the date through which your no-lapse guarantee is currently satisfied, and the premium required to extend it to your target age. Those two numbers define your real position. Only after you have them does comparing funding, reducing, or selling become a meaningful exercise.
Find out what your policy is worth — free, confidential, no obligation.
A 15-minute educational review covers your eligibility, every alternative, and a realistic view of what each path would net you.
Related Reading
- Sell My North American Universal Life Policy
- Sell My North American Indexed Universal Policy
- Sell My North American Term Policy
- Life Insurance Grace Period Explained
- Carrier Hardship Programs
- Carrier Change Of Ownership Requirements
- How Life Settlement Value Is Calculated
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.