Can I Get Life Insurance If I Am Dying?

Receiving a terminal diagnosis is overwhelming, and worrying about leaving bills behind can feel immense. You may wonder, “Can you get life insurance if you are dying?” While traditional coverage may not be an option, the good news is—specialized policies are available.

Step 1: Check Existing Policies for an "Accelerated Death Benefit"

Before seeking new coverage, review any life insurance policies you already have. Many policies include a feature called an Accelerated Death Benefit (ADB) rider or "living benefit."

This allows you to access a portion of your death benefit while still living if diagnosed with a qualifying terminal illness. Usually, this money is paid out as a tax-free lump sum and can help with medical bills, hospice care, or other urgent expenses.

Note: The amount you access now will be deducted from the final payout to your beneficiaries. Look for terms like “Accelerated Death Benefit” or “terminal illness rider” in your policy documents.

Step 2: Final Expense Insurance—Cover Funeral Costs

If existing policies don’t provide relief, final expense insurance is designed to cover funeral and burial expenses.

• Typically offers coverage between $5,000 and $25,000
• Uses a simplified issue application (basic health questions, no medical exam)
• Helps cover funeral services, cremation, burial, and related costs

This can be an option for people with serious health conditions, though approval isn’t guaranteed.

Step 3: Guaranteed Issue Life Insurance—No Medical Exams

If health questions are a barrier, guaranteed issue life insurance offers coverage with no medical exams or health questions.

• Guaranteed acceptance regardless of diagnosis
• Coverage is usually limited (often max $25,000)
• Premiums are higher compared to other policies
• Includes a graded death benefit: If death occurs within 2-3 years from natural causes, beneficiaries receive a refund of premiums paid plus interest, but not the full death benefit

This type of policy is typically a last resort, but it still provides valuable protection if you outlive the waiting period.

Key Difference: Guaranteed Issue vs. Final Expense

• Final Expense: Simplified health questions, potentially lower premiums, immediate full coverage if approved
• Guaranteed Issue: No health questions, guaranteed acceptance, but a waiting period before full benefits apply

Before speaking to an agent, list your major health conditions to help identify which option fits best.

Selling Your Existing Policy: Viatical Settlements

If you have a life insurance policy worth over $100,000 and a shorter life expectancy, you might consider a viatical settlement—selling your policy to a company for a lump-sum cash payment.

• Provides immediate funds
• The company becomes the new beneficiary (your heirs won’t receive the death benefit)
• Work only with a licensed viatical settlement broker who shops your policy to find the best offer
• Beware of upfront fees—reputable brokers don’t charge these

Your 3-Step Plan for Peace of Mind

1. Review existing policies for an Accelerated Death Benefit.
2. Decide your priority: funeral costs (Final Expense) or leaving a gift (Guaranteed Issue).
3. Consult a trusted, independent insurance agent who specializes in these options.

Remember, this is your decision—take your time and avoid pressure to decide quickly.