How Does the Underwriting Work for Final Expense Insurance


Final expense or burial insurance policies are whole life insurance products with limited underwriting. A case in point is Prosperity Life Insurance, which is primarily designed for older persons. It is for seniors that like to ensure their family will not have to bear a financial burden.

Whether it is to pay off a debt or the funeral costs, these plans can help when you pass away. For this reason, Prosperity Life Insurance Group offers several solutions for U.S. customers. They also have term life insurance, permanent life insurance, and several other supplemental health insurance products. 

Underwriting Process for Final Expense Insurance

Underwriting aims to assess the risk of insuring the policy purchaser. Most final expense whole life insurance policies are simplified issue products. Meaning, there is no full underwriting. There will not be a medical exam.

According to experts like Gary P. Cubeta from “Insurance for final expenses”, the Prosperity Life Insurance application process and underwriting are very straightforward.

Your agent may contact you over the phone during the initial phase. They will take necessary details, such as information about the selected plan and your answers to a questionnaire about your health.

The next step is where you speak to an underwriter to finalize the approval and rates to pay. All this takes a minimal amount of time, and there are around three questions that you need to answer. Among them, only one relates to your health.

You have to reveal if you had any of the listed conditions in the past two years and did not get treated. Moreover, many health issues like Cancer, Multiple Sclerosis, Type 1 and 2 diabetes, HIV, etc., are eligible for coverage. But they should be diagnosed two years ago.

By saying “no” to most of the questions, you can qualify for the plan. Moreover, your gender and if you are a smoker can affect the premium.

What Other Factors Play a Crucial Role for Your Qualification?

Type of Plan:

If it is a guaranteed approval plan, there will be no medical exam. Irrespective of your health, final expense insurance is available for people between 50 and 80 years of age. Coverage can begin from the next business day of your application.

Level Premiums:

While your smoking habit can increase the premium, it will never increase year after year. You pay locked-in rates once the policy gets approved. For instance, you have congestive heart failure, but you are a non-smoker.

In such a case, regardless of what it says on your medical record, your burial insurance policy’s monthly premium will not be very high. The lump-sum benefits will be paid to your family without any delay.

Graded Death Benefit:

If death occurs within two years of buying the policy, your beneficiaries will not receive the full death benefit amount. They get the total premiums paid and some interest, but if the cause of death is an accident, they receive it in full.

Which Option Works Well for You?

Consider the following three factors:

Fixed Period: Suppose you get additional income to make premium payments but are worried about paying it after retirement. Then, you can choose this option.

Lump-Sum: Pay your premium in a lump sum if you do not want to track monthly payments. Here, coverage will not lapse when your family needs it.

Payment Rate: Monthly payments mean there is a low-interest rate, but you pay more in total. There is also a risk of your coverage lapsing if you forget a payment.

Final expense life insurance is a permanent type of coverage. But you pay the premiums only until you are 95, for most plans. Given the benefits you get, consider all your options before purchasing one.