Final expense insurance is a type of whole life insurance with a benefit value sized to cover the expense of your final arrangements. There are no increasing rates over time and your policy doesn’t expire at any age. Final expense insurance is a type of permanent life insurance with a benefit value sized to cover the expense of your final arrangements, like funeral costs. The death benefit of a final expense policy is between $2,000 and $50,000, and most policies have an average advantage of between $10,000 and $20,000.
The permanent aspect of the policy means that, unlike a term life insurance policy, you are covered for life. Most people who seek out final expense policies are between the ages of 55 and 85.
When you purchase a final expense insurance policy, you will pay monthly premiums until the moment of your death. Suppose you continue to pay your monthly premiums and keep your policy in force. In that case, your beneficiaries will receive the death benefit when your time comes.
Beneficiaries can be any people you name on your policy and are most frequently close family members and friends who will be responsible for coordinating your funeral and cremation or burial arrangements. Your beneficiaries can use the death benefit money in any way they feel is best and are not restricted to using it solely on your memorial and funeral expenses. For this reason, many policyholders choose a more significant benefit, expecting the money to be used to help with medical expenses and other debts after they pass.
Advantages of Final Expense Insurance
Final policies are types of life insurance that allow you to set money aside to prepare for the costs of your funeral and cremation or burial arrangements and potential medical bills left to pay, credit card debt, or just life costs. Many payments at the funeral home (such as items purchased from third-party vendors) need to be paid with cash advances, which can put a financial burden on your loved ones at a time of grief, especially in the case of accidental death.
Funerals Aren’t Cheap
The costs of funerals can be near or upward of $10,000, depending on the goods and services you select. An average funeral service with cremation expenses will cost around $7,000, and average funeral costs with burial will cost about $9,000. Some of the big-ticket items are the casket and grave vault, an add-on that is required by many cemeteries to reinforce the burial site.
Make It Easy on Your Loved Ones
Planning for your final arrangements ahead of time allows you to make the decisions and communicate your wishes to family members. Many absolute expense insurance companies will help you document your desires to ensure you get the memorial you want.
Skip The Medical Exam
Another advantage of final expense coverage is that it is easy to qualify for a policy. Unlike most types of life insurance policies, you do not have a medical exam, no matter what health issues you might have at the moment. You only need to answer a few health questions. If you have a severe health condition and feel that you would not be accepted into a simplified issue (standard) final expense policy, you can instead opt for a guaranteed issue policy, which asks no health questions; you can expect to pay more for this plan.
Who Needs Final Expense Insurance
The final expense is a funeral insurance policy made for seniors planning for the end of their lives and hoping to leave stress off their loved ones. The peace of mind that you can provide for your family and yourself at such a low cost makes final expenses the perfect type of life insurance option for seniors.