Final expense insurance with dementia or Alzheimer's

Why dementia usually means guaranteed issue

Dementia is one of the few conditions that most underwritten final expense plans exclude outright. Mutual of Omaha's Living Promise excludes anyone ever diagnosed with Alzheimer's or dementia. Foresters PlanRight excludes Alzheimer's, dementia and memory loss.

Many families face this. The CDC estimates 6.7 million older adults in the US have Alzheimer's disease, the most common type of dementia. It describes dementia as a decline that disrupts daily life, not a normal part of aging.

Royal Neighbors of America asks about dementia, Alzheimer’s or memory loss in the last 10 years, and whether you are in memory care. Its form says a yes answer does not rule out every offer, so it is worth asking what it would issue.

How guaranteed issue plans work

Guaranteed issue plans ask no health questions, so a dementia diagnosis does not stop approval. You only need to fall within the age range.

The trade-off is a 2-year graded period: if death from illness happens in that time, Corebridge and Gerber Life pay 110% of premiums, and Mutual of Omaha pays premiums plus 10%. Accidental death is covered in full from day one at Mutual of Omaha. Our waiting periods guide explains this in detail.

Mutual of Omaha accepts ages 45 to 85, while Corebridge and Gerber Life accept ages 50 to 80. In New York, Mutual of Omaha and Gerber limit issue to ages 50 to 75. Corebridge and Gerber cap their guaranteed plans at $25,000 per person.

Consent, capacity and who signs

The person being insured normally signs the application, confirming that the answers are true. That raises a real question when dementia affects understanding.

Royal Neighbors' application, for example, has the proposed insured confirm that all statements are true to the best of their knowledge.

If your loved one cannot understand what they are signing, call the carrier before applying. Ask whether it accepts a power of attorney or guardian, and whether a family member can own and pay for the policy. Rules vary by carrier and state.

Never sign for someone without legal authority. A policy obtained that way may not pay when your family needs it.

Memory loss without a diagnosis

Some applications ask about memory loss, not just a formal diagnosis. Foresters and Royal Neighbors both include memory loss in their questions.

Answer based on what doctors have diagnosed, treated or advised, as each question is worded. If you are unsure whether a note in your records counts, ask the carrier before you answer.

Misstatements can be costly. Policies are usually contestable for their first two years. In New York, for example, the law lets an insurer contest a claim in that window if it proves a material misrepresentation.

Comparing guaranteed issue plans

Guaranteed issue plans look alike but differ in useful ways. Compare age limits, coverage limits, early-death payouts and state rules.

Gerber Life offers $5,000 to $25,000 in $1,000 steps, with a $15,000 cap in South Dakota. In North Dakota, its graded period is one year instead of two.

Corebridge limits all of its guaranteed issue whole life policies to $25,000 per person combined. Gerber applies the same combined limit to its guaranteed policies.

Mutual of Omaha pays the full benefit for accidental death from day one. For death from illness in the first 2 years, it pays premiums plus 10%.

Planning steps for families

Apply sooner rather than later, because the 2-year graded period starts when the policy is issued and premiums rise with age. See our guides for people over 75 and over 85.

Consider coverage for healthy family members while they can still qualify for a level plan. A policy kept in force is not canceled because health changes later.

Compare guaranteed issue plans on price, age limits and graded payout, since they differ. You can compare quotes or review what final expense covers. Availability varies by state and carrier.