Final expense insurance is a low-cost type of life insurance that pays what’s called a death benefit to beneficiaries upon the death of the insured. The death benefit is intended to cover expenses associated with the insured’s death, such as a memorial service or funeral, embalming and casket, or cremation. Final expense is here to make sure your loved ones can spend time grieving and celebrating your life when you pass — not worrying about funeral costs.
If you already have life insurance or have prepaid your funeral expenses, you likely don’t need final expense insurance. But if you don’t have a life insurance policy and are worried about leaving a financial burden on your family when you die, final expense may be a good option. Later in life, regular life insurance policies generally won’t be affordable due to your age and potentially your health.
Final expense insurance can help you bridge the gap with an affordable premium paying out a smaller death benefit than other life insurance policies would. You pay the same monthly premium for the life of your policy, even if you develop a health condition later. Your premium depends on your age at the time of purchase, health, and in some cases, whether or not you use tobacco products.
Final expense coverage depends on your specific insurance policy. Usually, the death benefit the policy pays out is between $2,000-$50,000.
Death benefits are intended to cover expenses associated with the insured’s death (although technically, there are no rules and beneficiaries can use the death benefit in any way they’d like). Some common expenses associated with death include:
Funeral costs can add up quickly (in 2021, the average funeral costs between $7,000 and $12,000). Final expense insurance can ensure that your family isn’t left with a financial burden when you die.
Final expense insurance is intended to be an affordable life insurance option, so most people can easily qualify. The insurance company will ask you a few basic health questions about your history of major health conditions, smoking, and drug abuse. You won’t be required to have a medical exam.
If you have serious health issues, you may need to apply for a guaranteed issue policy.
Guaranteed issue is a special type of final expense insurance for people with serious medical issues. These types of policies are more expensive, and they do not require medical questions, medical records, or a medical exam.
Guaranteed issue policies have a two to three year waiting period before benefits will be paid. If the insured dies during this waiting period, the insurance company will not pay the policy’s death benefit. However, they will pay back the premiums paid plus interest to the beneficiaries.
If you have a serious health condition and are worried about the financial burden left on your family when you die, a guaranteed issue policy may be a good choice for you.
Senior Health Solutions located in Opelika, AL can help. We specialize in helping you determine the type of insurance coverage that best suits your needs. If you are interested in a final expense policy, give us a call now at (866) 445-5215.
We are not connected with or endorsed by the United States government or the federal Medicare program. We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options.
