If you need final expense coverage – and you need it fast – you’re in luck. It is possible to purchase burial insurance with no waiting period!
Some health issues may mean you are ineligible for immediate insurance coverage, but the good news is you can always present your risk favorably to underwriters. How you present your risk could make all the difference in how long you wait for coverage.
If you are a senior in poor health, you have a few options when applying for burial insurance. Typically, you will:
- Be declined for coverage
- Pay high premiums with a waiting period
- Pay higher premiums with a partial waiting period
- Pay higher premiums with no waiting period.
In this article we will explain exactly why some carriers impose a waiting period before granting coverage, and what you can do to avoid these waiting periods.
What is Burial Insurance With No Waiting Period?
Burial insurance with no waiting period will pay out your death benefit starting on the very first day of your coverage.
Typically, burial insurance carriers require a two year limited benefit period. If you pass away during the first two years of your coverage, only your already-paid premiums will be returned. Companies do this to protect themselves financially.
Companies with no waiting period face a lot of risk. In order to mitigate this risk, companies need to know that you are not, statistically, likely to die right away. Otherise, a company would be paying out thousands of dollars in exchange for a few small premiums.
With no-waiting period burial policies, your beneficiary will receive the full death benefit – even if you’ve only made one premium payment before passing away. Surprisingly, a lot of companies offer this option!
In order to find out which companies will offer an immediate benefit policy, you should speak to an agent. An independent life insurance broker has access to all key final expense carriers, and can help you choose the best option.
Final Expense Insurance with Partial Waiting Periods
In some instances, you may also qualify for burial coverage with a partial waiting period. These policies hover somewhere in between a 24 month waiting period and no waiting period.
Rather, your benefit will be graded, and a portion of your benefit will be paid out. This is why these policies are sometimes referred to as “Graded” policies.
Here’s how this coverage works:
- Death within the first year of the policy will pay out roughly 30% to 40% of your whole benefit.
- Death between year 1 and year 2 will pay out up to 80% of your death benefit
- Death after two years of the policy will pay out 100% of your benefit. If you pass away any time thereafter, your beneficiaries will still receive 100% of your death benefit.
In some instances, this may be the best option for you. While we list a few health issues here, be sure to speak to your agent about your specific case.
Avoiding the Burial Insurance Waiting Period
- Go with an agent. The easiest way to avoid a burial insurance waiting period is to use an independent insurance agent. These individuals know right away which carriers don’t require a waiting period, and if you are qualified for those policies. This saves you a lot of time and hassle.
- The first step to avoiding a waiting period with burial insurance is to answer a health questionnaire.
This may seem counterintuitive – especially if you are in poor health. Any agent will tell you that an application with a health questionnaire will help give a carrier an accurate picture of your health without a medical exam.
If you go with a guaranteed issue burial policy, you will almost always have to deal with a 24 month waiting period.
- If a carrier doesn’t ask about a specific health issue, it means they are okay with covering that particular health issue. Your agent can help you navigate the questionnaire more thoroughly.
Health Conditions That Require Waiting Periods
As much as we would like to guarantee that you won’t have to undergo a waiting period, the truth is that certain health conditions will require a waiting period no matter what. This is due to their high risk.
The health conditions that may result in a partial waiting period are:
- Drug or alcohol abuse (if you’ve had treatment within the last two years)
- Diabetic amputations
- Cancer within the past 24 months
- Congestive Heart Failure
The health conditions that almost always require a full waiting period are:
- Terminal illness (you’ve been given a life expectancy of 24 months or less)
- Currently in hospice care
- A current stage 3 or above cancer diagnosis
- Organ transplant diagnosis
- Recent stroke (within 12 months)
- Heart attack or heart surgery within 12 months
These are simply guidelines. If you’ve been following us for a while, you are aware that all companies view risk differently. If you do not have any of the above health issues, talk to your agent! You can, most likely, qualify for burial insurance with no waiting period!
The Bottom Line
There are many variables an insurance company has to consider before providing burial insurance to seniors with no waiting period. This is why we are always suggesting you speak to a life insurance agent before making any insurance purchase decisions.
Your agent will take the time to understand your health and your coverage needs. This personal touch – combined with your agent’s understanding of the industry and how individual carriers assess risk – means you will get the best coverage every time.