There is a big difference between a “modified whole life policy” and a “modified premium whole life policy.”

A modified whole life insurance policy is a path to guaranteed coverage even if you have dire health conditions.

A modified premium policy is one where the initial price would be lower for the first few years, and then it would increase.

Learn how these policies work, the pros and cons, cost estimates, and whether a modified plan is right for you.


How Does Modified Whole Life Insurance Work?

Modified whole life insurance is a policy that will accept applicants who have severe pre-existing conditions.

Many final expense policies are modified whole life insurance coverage.

In most cases, approval is guaranteed.

These plans always have a waiting period during the first 2-3 years of the policy.

The insurance company will only refund your premium payments and interest for any non-accidental death of the policyholder during the waiting period.

After the waiting period is over, the full death benefit is payable for any reason.

A life insurance company might use the term “graded benefit whole life” instead of “modified.” For example, Mutual of Omaha Living Promise uses “graded” to describe their modified benefit option.

Modified plans also have higher premiums compared to traditional whole life policies. That’s because they have little to no underwriting.

The insurance company accepts much higher risk, hence the more expensive premium payments.

Beyond the waiting period, modified plans work like traditional whole life insurance.

The premiums will not increase, the coverage will never decrease or expire, and they build cash value.


What Is Modified Premium Whole Life Insurance?

Modified premium whole life was a type of policy with initial lower premiums for 2-10 years.

After the introductory teaser rate expired, the price would increase and remain at that cost indefinitely.

The main thing to understand about modified premium whole life is that it no longer exists.

It was a type of whole life policy sold in the past, but it’s no longer available today.

If you buy any whole life insurance today, the price will be fixed for life.


Pros And Cons Of Modified Whole Life Insurance

The Good
  • Seniors with dire health issues still qualify
  • Health questions are often not required
  • Permanent life insurance coverage that will last your entire life
  • Level premiums that will not increase
The Bad
  • 2-3 year waiting period before the full face amount is payable to your beneficiaries
  • Premium amounts are higher due to the insurer taking on more risk
  • No dedicated customer service phone number
  • Nearly instant approvals due to little or no underwriting


How Much Does Modified Whole Life Coverage Cost?

The table below contains sample modified whole life insurance rates for various benefit amounts.

However, remember that your exact age and the company you apply with may result in a different cost.

Speaking with an independent insurance agent will likely give you access to lower rates. Independent agents can compare life insurance quotes from multiple providers to find you the best deal.

All prices shown are monthly estimates.



When You Should Buy A Modified Benefit Whole Life Coverage Cost?

For starters, most people can qualify for some type of burial life insurance that immediately covers you for the total face value of the policy.

That will translate into lower premiums and peace of mind knowing that your death won’t create a financial burden for your surviving loved ones.

However, there are some situations where a modified benefit whole life policy is your only option.

Below is a list of health conditions. If you have any of these issues, a modified policy is the only life insurance plan you can get.

However, if you do not have any of these conditions, there is a high chance that you can qualify for other insurance products that cost less and fully cover you right away.

  • Dialysis
  • Organ or bone marrow transplants
  • Dementia or Alzheimer’s
  • Bedridden
  • Wheelchair-bound due to a disease or illness
  • Congestive heart failure
  • Personal oxygen equipment (unless it’s for sleep apnea)
  • Cancer or treatment for cancer within the last 12 months
  • AIDS or HIV
  • Liver failure
  • Currently in a nursing home, hospital, or nursing facility
  • Diabetic nephropathy (kidney damage from diabetes)


How To Qualify For Life Insurance With No Waiting Period

There are senior burial insurance companies that offer permanent coverage with an immediate payout.

The most important thing to understand about no waiting period coverage is that you must qualify for it.

Any type of policy with no health questions will always have a waiting period for a number of years (usually 2-3). No health question policies are often called “guaranteed acceptance.”

You don’t have to undergo a medical exam to qualify for immediate coverage. However, you will have to answer health questions.

The key is finding a final expense life insurance company accepting of all your health issues.


Frequently Asked Questions

Whether modified or not, all whole life policies build cash value. Funds in the cash value account always grow tax-deferred.

Modified premium whole life insurance is virtually non-existent at this point. It was a type of whole life policy with a lower premium in the early years. After the introductory period, the premium increases by a substantial amount. A term life insurance policy will often increase in price over time. The same is true for many universal life insurance. However, present-day whole life policies (modified or not) have a fixed premium schedule.

You can cancel any form of insurance whenever you want. If you cancel a modified whole life insurance plan, the insurer will refund you the net surrender value. The surrender value will be very close to your total cash value when you cash it in. Alternatively, you can roll the funds into an annuity.