Guaranteed vs. Non-Guaranteed Values
Also called guaranteed column, non-guaranteed values, current vs guaranteed
The split in every permanent-policy illustration between what the carrier is contractually bound to deliver and what it merely hopes to — only one side is a promise.
Every permanent-policy illustration is printed in two flavors, and the difference between them is the most important thing a buyer can understand. The guaranteed values are calculated using the worst terms the contract allows — the minimum credited or cap rate and the maximum cost of insurance — and the carrier is legally required to honor them. The non-guaranteed values assume today’s friendlier rates and current charges continue unchanged for the life of the policy.
Only the guaranteed column is a contract. The non-guaranteed column is a projection built on assumptions the carrier can revise — and on universal life and IUL blocks, carriers have revised them, cutting caps and raising cost-of-insurance rates on policies already in force. When that happens, the policy drifts from the non-guaranteed picture toward the guaranteed one, and the buyer discovers that the numbers that sold them were never owed.
This is why the entire bait-and-switch illustration problem exists. A policy can be made to look wonderful on the non-guaranteed page and grim on the guaranteed page, and nothing stops an agent from presenting only the first. Reality usually lands somewhere between the two — but often closer to guaranteed than the sales conversation ever admits.
The move is simple and it cuts through almost everything: put the two columns side by side and read the guaranteed one first. Ask, “If every assumption goes against me, what does this policy do — and when does it lapse?” If the guaranteed column can’t survive, you’re buying a projection, not protection.
This distinction is the whole game. The guaranteed column is a contract; the non-guaranteed column is a projection the carrier can walk back. Agents sell the projection and quietly rely on you never reading the contract.
A universal life illustration shows the policy thriving at age 90 — in the non-guaranteed column at current rates and current cost of insurance. The guaranteed column, using the contract's minimum rate and maximum charges, shows the very same policy lapsing at 74. Both are 'the policy.' Only the second is enforceable.
A sales conversation that never mentions the word guaranteed. If the numbers you're excited about live only in the non-guaranteed column, you're being sold a hope, not a contract. Always compare the two columns side by side.