Updated: Apr 10
Do you want burial insurance but were diagnosed with a major illness?
After being medically diagnosed with a serious illness, your only option may be a Graded or a Guaranteed Issue insurance policy, but then again it may not— it all depends on the medical condition and the severity of the condition.
Below we’ll explain how these plans work, and then help you understand if you would need a Level, Graded or Guaranteed Issue (GI) plan.
What is Final Expense Insurance Exactly?
Burial insurance aka Final Expense or funeral insurance is whole life insurance that has a small death benefit and is easier to get approved for than traditional whole life insurance.
There are several plans available and the best plan for you is determined by your answers to the underwriting questions which are administered during the application process.
What Plans Are Offered For Final Expense Insurance?
There are three (3) Final Expense policy types with any given insurance carrier:
Level (or Preferred) Benefit: The lowest-cost option with coverage that begins immediately.
Graded (or Modified) Benefit: This option has higher premiums than a Level Benefit AND a delayed payout during the first 2-3 years, depending on the insurance carrier.
Guaranteed Issue (GI) Benefit: The highest-priced option and comes with a 1-2 year waiting period on the benefit payout, depending on the insurance carrier.
Here's the most important points to understand:
Graded and Guaranteed Issue plans cost more than a Level plan and comes with a waiting period. The length of the waiting period depends on the medical condition, but a 1-2 year wait is the most common wait duration.
Level or Graded insurance coverage is something you must qualify for. You won’t have to take a physical exam, but at minimum you will have to answer health questions. There are no
health questions for Guaranteed Issue policies.
What Is Level Life Insurance Exactly?
A Level Benefit plan is a type of Final Expense Whole Life insurance. Level (or Preferred) is the lowest cost plan available with the coverage and benefit starting immediately.
This type of insurance is for those with little to no health conditions. It pays to be healthy!
What Is Graded Life Insurance Exactly?
A Graded Benefit plan is a type of Final Expense insurance which is Whole Life insurance, and comes with a waiting period during the first 2-3 years. For a non-accidental death of the insured, during the waiting period, the insurance carrier will refund all of the premium payments paid into the policy PLUS an interest fee, typically 5%-30%, depending on the carrier. For an accidental death of the insured, the entire death benefit will be paid to the beneficiary. Once the waiting period is over, the full benefit is paid for both accidental or non-accidental death.
What Is Guaranteed Issue (GI) Life Insurance Exactly?
A Guaranteed Issue is also a type of Final Expense insurance which is Whole Life insurance plan which also comes with a waiting period during the first 1-2 years. For a non-accidental death of the insured, during the waiting period, the insurance company will refund all the premium payments paid into the policy PLUS an interest fee, typically 5%-30% depending on the carrier. For an accidental death of the insured, the entire death benefit will be paid to the beneficiary. Once the waiting period is over, the full benefit is paid for both accidental or non-accidental death.
A Guaranteed Issue (GI) is your only option if you have any of the following issues:
AIDS or HIV
Currently in the Hospital or Nursing Facility
Currently receiving Hospice Care
Recommended to have an Organ Transplant
The difference between a Graded plan and Guaranteed Issue plans: A plan is Graded because of the answers to specific health questions while a Guaranteed Issue plan will insure someone with NO health questions asked.
What Determines The Insurance Plan You Qualify For?
The plan a person qualifies for is determined during underwriting. Underwriting is the risk assessment performed on an applicant which consists of medical questions which are administered during the underwriting process. The questions are typically conducted by your insurance agent or an agent with the insurance carrier.
The unique element to burial insurance is the lenient underwriting. Insurance carriers accept most of the health issues that would be declinable with traditional whole life insurance.
The lenient underwriting enables people with high-risk conditions to qualify for a policy which makes final expense insurance a great option for those with health conditions! The following are health conditions that you can have that will still allow you to have a Level life insurance policy that begins immediately with first day coverage!
What Health Conditions Can I Have And Still Get Coverage?
Arthritis (All Kinds)
Cancer over 2 Years Ago
Chronic Kidney Disease
COPD, Emphysema, & Chronic Bronchitis
Defibrillator or Inserted Pacemaker
Strokes over 1 Year Ago
Heart Attacks over 1 Year Ago
Hepatitis A, B, or C
High Blood Pressure
Mini Strokes (TIA's)
Systemic Lupus (SLE)
Type 1 Diabetes
Type 2 Diabetes
How Do You Apply For Coverage?
It's very easy to apply for a Final Expense life insurance plan! You can speak to a licensed agent, or broker, and they'll guide you through the process. The benefit of using a broker is they can have access to multiple carriers to search for the best priced policy. There is never a medical exam, and you're not required to provide your medical records.
The questions on the application will be administered to you by your agent, or the insurance carrier, and in most cases you'll receive an immediate answer regarding your eligibility.
You will have to consent to a prescription history check, and most applications can be completed in 20 minutes, or less!
How Can AffinityQuotes Assist You?
If you were diagnosed with a major illness, AffinityQuotes will help determine if you need a Level, Graded, or Guaranteed Issue policy and then find the BEST insurance carrier for you.
Here’s why we believe that…
First, we are independent agency and represent dozens of different insurance carriers. We're not obligated to any one carrier which gives us the freedom to shop the best deal for YOU.
Having many companies to choose from is important if you have health concerns.
To get the best deal you have to look at as many insurance companies as possible to find the one that will give you the best rates for the particular health issues you may have.
AffinityQuotes shops dozens of insurance carriers to find which one(s) will accept you based on your health conditions.
Whatever questions you have, we'll provide the answers to you at no cost.
Call 855-400-7766 to see what a licensed AQ agent can do for you.