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

What Is Modified Whole Life Insurance?

Modified whole life insurance is a policy that will accept applicants who have severe pre-existing conditions. In most cases, approval is guaranteed.

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

The insurance company will only refund your premium payments and roughly 10% 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. The cost is higher because these plans have little to no underwriting, which means the insurance provider is taking on a high level of risk. With more risk, insurance costs more.

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 kind of whole life insurance today, the price will be fixed forever.


Pros And Cons Of Modified Whole Life Insurance

The Good
  • People with dire health issues still qualify
  • Health questions are often not required
  • No medical exam is required
  • Can often be bought online directly from an insurance company or agency
  • Level premiums that will not increase
  • Death benefit won’t decrease
  • Builds cash value that you can borrow against should you need to
The Bad
  • 2-3 year waiting period before the full death benefit is payable to your beneficiaries
  • It’s more expensive because the insurer is taking on a high amount of risk
  • Coverage amount maximums are low (typically $25,000 and under)
  • Nearly instant approvals due to little or no underwriting
  • Fast applications that usually take less than five minutes to complete


How Much Does Modified Whole Life Coverage Cost?

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

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

All prices shown are monthly estimates.



When Should You Buy A Modified Benefit Whole Life Policy?

Most people don’t need to buy a modified whole life policy because most seniors needing final expense life insurance can qualify for a plan with no waiting period.

Getting coverage with no waiting period 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, call us at 1-800-644-2926. We can likely get you a non-modified plan that covers you immediately for natural or accidental death.

  • Organ or bone marrow transplants
  • Dementia or Alzheimer’s
  • Bedridden
  • Wheelchair-bound due to a disease or illness
  • Currently have or are being treated for cancer (some types of current cancer stage 0-1 are acceptable)
  • AIDS or HIV
  • Liver failure
  • Currently in a nursing home, hospital, or nursing facility


How To Qualify For Life Insurance With No Waiting Period

Many senior burial insurance companies 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 policy with no health questions will always have a waiting period that lasts 2-3 years.

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

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

If you have any pre-existing conditions, your best chance at finding no waiting period coverage is by working with an independent broker such as Choice Mutual.

Independent brokers (aka “agencies”) partner with multiple insurance providers to pair each client with whichever company offers them the best policy.

Remember, all insurance companies compete with one another primarily via the cost of the insurance and the underwriting.

For example, one insurance company may not accept people with diabetes, but another will.

Independent brokers will assess your medical history to determine which companies will offer you the best price and, hopefully, coverage with no waiting period.

Working with an agency is free, and the insurance has no additional fees or costs.


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 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 would increase by a substantial amount. Presently, whole life policies (modified or not) all 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.