Life Insurance

Is Final Expense Insurance Right For You?

Feb 10, 2021
Father and his children camping indoors
Most people think of life insurance when they want to provide financial stability for loved ones in the event of their untimely death.

Significant planning goes into calculating how much life insurance you need at various stages in your life to ensure that a death benefit will protect your family. You may want to replace income for the household while children are living at home or cover debts to keep loved ones from experiencing financial strain when they settle your estate.

Not all life insurance policies are suitable for people who simply want to cover their funeral and burial expenses, though. Those in retirement may not have the same life insurance needs that they did when they were raising a family or building a business.

Even so, burial and funeral expenses can put a strain on a family’s finances. In America, the average funeral could cost you between $7,000 and $10,000. Since laws about burial vary by state, costs could be higher in some areas.

Cremation is less expensive but will still cost about $4,000 with the help of a funeral home. The cost of a funeral rose nearly 30% between 2004 and 2014, according to the National Funeral Directors Association. Final expense insurance is one way to cover medical costs and other expenses at the end of life.

What Happens If The Family Can’t Pay For A Funeral?

When a person dies, a member of the family or a close friend usually claims the body. They are then responsible for making burial or cremation arrangements. If there isn’t anyone who has the financial means to pay for the associated costs, the body goes unclaimed and the state must make arrangements for burial.

What Is Final Expense Insurance?

Final expense insurance falls under the umbrella of permanent life insurance. It’s a type of guaranteed life insurance, and the policy is typically issued after the applicant answers a few general questions.

Final expense insurance stays in force no matter how long the policy owner lives. It also costs more than other types of life insurance, but everyone who applies gets coverage so long as they are willing to pay the premiums. Even people who are advanced in age or have serious health issues can get coverage quickly.

Some funeral homes will accept proof of final expense insurance and assignment of the benefit instead of payment upfront. This is great for the family because then they don’t have to come up with thousands of dollars when their loved one dies. The beneficiary named on the insurance policy gets any money left after the funeral home settles the account.

Not all funeral homes accept this payment arrangement, though. In those cases, friends and family must pay the funeral home up front and recoup the money with the insurance company payout.

Who Is Final Expense Insurance Right For?

For seniors who don’t need a large life insurance policy, but still want to cover their end-of-life expenses, a final expense insurance policy meets their needs. If your age or health issues may prevent you from getting access to traditional life insurance, final expense insurance is also worth considering. It should be noted that this type of life insurance is more expensive, though. If you are younger and in good health, you’ll likely be able to buy a term life insurance policy for less money.

If you decide to buy a final expense life insurance policy, it’s helpful to have done your research to make sure you don’t have other, less expensive options. Final expense insurance is not meant for everyone, but for the right person it can provide valuable peace of mind, and a fast, simple process.

Guaranteed Issue Whole Life Insurance With Ethos

An option worth considering for seniors looking for help covering their final expenses is guaranteed issue (GI) whole life insurance with Ethos. Our guaranteed issue policies offer instant approval for all applicants aged 65 through 85, with a range of coverage options up to $25,000. Applicants are guaranteed to be approved in a matter of minutes, regardless of their medical history, and without having to take a medical exam. To learn more about the features of this policy, and to get a customized quote, visit our site today.