graded life insurance

what is a graded premium life insurance policy?

The good news is that people with serious medical issues can get new coverage through a modified whole-life plan. Most modified life plans do not require any medical/lifestyle underwriting. Even if you have a severe illness, you may still be eligible for new coverage. Modified whole life could be the only option to obtain a new policy, depending on the severity of your health problems.

Are you curious about modified whole life insurance?

If you have diabetes, your pocketbook and family won't appreciate XYZ company because they'll deny you or, at minimum, charge you much more than ABC company.

graded life insurance

You would get the best Policy with the company offering the best rates, coverage, and support for diabetics.

Coach B. and other agencies, you can only get the best coverage for the lowest rate if you work with an independent agency. This agency will review at least 15 life insurance companies on your behalf.

Death benefit protection doesn't change, but premiums aren't the same.

term life insurance definition

An insurance policy allows the insured to pay less premium than usual over a specified period. After this period, premium payments are increased to an agreed-upon sum greater than usual for the Policy's lifetime.

Insurance companies that offer life insurance compete on price and underwriting.

The lower rates you're charged early in your modified whole-life Coverage aren't a discount — you'll make up the difference with higher payments after the initial period ends.

term life insurance definition
modified life insurance premium

modified life insurance premium

This applies to modified whole life insurance.

As a short recap, there are partial coverage plans that payout a portion of the death benefit during the first two years and there are plans that will pay out 100% of the benefit right away.

Just like most things in life, everything has its pros and cons.

traditional level premium contract example

Life insurance companies compete with each other via price and underwriting.

Modified whole life policies are also known as modified Premium Whole Life. They come with low introductory rates. The premium increases only once during the introductory period. It remains the same for the duration of the Policy. A modified premium policy allows you to purchase coverage sooner than you might typically be able.

Your premiums start to fund your cash-value account immediately with whole-life insurance. For most modified whole-life policies, however, you will need to wait until your premiums increase.

graded benefit life insurance companies
graded benefit life insurance companies

It is possible to have a modified plan, no matter your health.

So rejoice in knowing that a modified plan is an option no matter how bad your health is.

While the differences may seem small, they can have a tangible impact on your finances. You may not lose out on much cash value growth over two years, but a more extended introductory period can set you back. And you'll be going without a critical policy feature while paying five to 15 times more than it costs to get similar Coverage under a term life policy.

overfunded variable universal life insurance

A quick recap: There are two types of partial coverage plans. One pays a portion of your death benefit for the first two years, and another pays 100% immediately.

It is necessary to be eligible for immediate coverage policies. While you aren't obligated to pass an exam, at least you will need to answer some health questions to be approved.

If you can't pay your premiums when they go up, your Policy will lapse, and you could be liable for high surrender fees. More importantly, your family will lose out on your Policy's financial protection.

overfunded variable universal life insurance

Frequently Asked Questions


Modified whole life insurance offers lower premiums for a short time (usually two to three years but occasionally up to five or 10), followed by a higher rate for the remainder of the policy.



CEO, The Annuity Expert. A Modified Endowment Contract, or MEC, is a life insurance policy modified from the traditional whole life insurance policy. A MEC offers tax-deferred growth and allows you to take out loans against the policy's cash value without penalty.