MODIFIED AND GRADED PREMIUM WHOLE LIFE INSURANCE
Lower Premiums in Early Years with Higher Premiums Later
What is Modified and Graded Premium Whole Life Insurance
Modified whole life insurance policies have premiums that are lower than straight whole life insurance in the first few years (usually five) and then higher premiums thereafter. During the initial period, premiums are only slightly higher than a term life insurance.
Whereas, Graded premium whole life insurance have premiums that are lower than straight whole life insurance slightly above those of a straight whole life insurance policy.
the first year and increase slightly during a preliminary period. After the preliminary period (usually 5 to 10 years) the premiums are
Who Buys Modified or Graded Premium Whole Life Insurance
Because of their lower premium requirements in the early years of the policy, modified and graded premium contracts are a solution for individuals who need immediate death benefit protection, want whole life coverage but have limited financial resources with the expectation that their financial situation will improve in the future.
This along with some optional features such as the ability to add additional life insurance coverage without underwriting and disability waiver of premium make graded and limited pay life insurance options a good fit for someone just starting out or a growing business.