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Graded Benefit Life Insurance

What is a Graded Benefit Life Insurance Policy?

Graded Benefit Life Insurance

It’s a life insurance plan that provides a death benefit that increases with the age of the insured.

Graded benefits may increase gradually and then level off, or they may increase sharply before becoming level.

This type of life insurance coverage is most common in juvenile life insurance, life insurance plans for seniors, people with health conditions, or those who have been turned down for life insurance.

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Example: A senior life insurance plan providing $20,000 of life insurance coverage for a 10 year term with premiums of $300 and a 2 year graded death benefit period.

In this example the insured person pays the annual premium of $300 once a year for 10 years.

If the insured person dies within the 10 year term, the beneficiary receives the $20,000 death benefit.

However, if the insured dies within 2 years of purchasing the life insurance policy the death benefit paid will only be the amount of premium paid plus any interest on that premium.

If the insured were to die after the 2 year graded benefit period, more than 2 years after buying the policy, the beneficiary receives the full death benefit of $20,000.


Death Benefit

In a graded benefit life insurance policy, the death benefits are not level. The beneficiary will be paid all of the premiums paid plus 10% interest on those premiums if the insured person dies within the first 2 years of being insured. If the insured dies after being insured for 2 years, the beneficiary receives the full death benefit.



Premiums for graded benefit life insurance policies are generally higher than those for standard life insurance policies since the policyholder presents greater risk of a death claim to the insurance company. Even though the death benefit is not level, premiums are, the premiums remain the same each year of the policy.


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Mutual of Omaha offers guaranteed acceptance whole life insurance for people age 45 to 85. Choose $2,000 up to $25,000 of coverage. Rates start as low as $8.84 per month. There’s no medical exam and no health questions. You cannot be turned down. You can get a quote and apply online now. START HERE to get a FREE Quote.

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Life Insurance for Seniors Age 50 to 85

Graded Benefit Life Insurance

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