Final expense insurance, also known as burial insurance, is a type of insurance that is meant to cover costs associated with end-of-life. By purchasing a final expense plan, the policyholder is financially protecting their loved ones. There are multiple types of final expense policies. One type is a level final expense plan. This policy is best for people in excellent health who want the lowest cost. Learn more about a level final expense policy below.
Types of Final Expense Plans
There are four types of final expense policies: level, graded, modified, and guaranteed issue.
These plans are best suited to different policyholders based on their health. Level plans are for the healthiest people and cost the least. Graded policies are targeted at people with moderate health problems that do not pose immediate threat — but will likely become serious in the long-term. Modified options are geared towards people with more serious problems. Meanwhile, guaranteed issues are for people with the worst health that would likely otherwise be rejected. These are also the most expensive options.
We’ll discuss each one briefly below.
Level
- Applicant Health: Excellent
- When You’re Eligible for Benefits: Immediately after death
- Cost of Plan: Low
Graded
- Applicant Health: Minor Health Problems
- When You’re Eligible for Benefits: 2-year waiting period
- Cost of Plan: Medium
Modified
- Applicant Health: Serious Health Problems
- When You’re Eligible for Benefits: 2-year waiting period
- Cost of Plan: High
Guaranteed Issue
- Applicant Health: Non-specific, but generally the most serious problems
- When You’re Eligible for Benefits: 2-year waiting period
- Cost of Plan: Very High
About Level Final Expense Insurance
Level final expense insurance policies have the lowest monthly premiums. People who qualify for level policies are in excellent health. Before purchasing a policy, be sure to check with the company to see if you pass the medical underwriting. Some people who have had surgeries or are on prescription medication may not pass the underwriting.
The “level” part of the level final expense insurance policy refers to the monthly premium. It means that the cost of the premium never increases. It also means that the policyholder could expect their death benefit immediately with no waiting period. This is in contrast to the other three policy types.
The other three policies require a 2-year waiting period. So, if you purchase the policy and die before the 2-year window is over, your beneficiaries won’t get the death benefit. However, because the level final expense policy has no waiting period, the beneficiaries are guaranteed to receive the death benefit.
Contact Senior Life Services
Final expense insurance can be confusing. Sorting through the different types can make it even worse. That’s where we come in. For all of your insurance and end-of-life questions, contact Senior Life Services today.