- Example: An insurance company issues a guaranteed investment contract (GIC) for $10,000. If the GIC has a five-year maturity and a guaranteed interest rate of 8%, i t promises to pay $10,000 x 1.085= $14,693.28 The company can choose to fund its obligation with $10,000 of 8% annual coupon bonds, selling at par value, with six years to maturity. As long as the market interest rate stays at 8%, the company has fully funded the obligation. Why? What if the interest rate fluctuates