What is Graded Benefit Life Insurance?


Benefits that are paid out in the event of a policy holder’s death, is referred to as a face amount. Graded benefit life insurance (GBL) policies are whole life insurance policies which have a death benefit that differs from the face amount for the first two years that the coverage is in place.   In the first two years that this policy is in place, the dollar amount that was already paid into the policy, along with between approximately seven to ten percent interest, will be the death benefit amount.

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Should the covered person pass away as a result of an accident of some sort, during the first two years of getting the graded benefit life insurance policy, the face amount in its entirety will be paid.  Face amounts on these policies do not ever change to a different amount like with whole life insurance coverage .

 Who will graded benefit life insurance be sold to?

This type of life insurance policy is generally available to people over the age of fifty years old that are not in the best of health but has a life expectancy of more than two years.  The providers of this coverage do not require the applicant to give answers or explanations about the state of their health and they are not required to take any health assessments.  Generally speaking, a person who is not at least fifty years old may not apply for this coverage. To learn more about over 50 life insurance, please read the article “Let Us Help You Find Life Insurance over 50.”

This type of coverage is different in the way it is sold.  It can only be brought in units and these units are sold according to the person’s death benefit amount.   The amount of coverage a person will be allowed is highly determined by their age.  The units are generally affordable.  Applicants should be aware that they might have to purchase many units in order to gain a large death benefit payout.

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