What Is Final Expense?

You’ve probably seen advertisements for Final Expense insurance on TV or received them in the mail. If you haven’t paid much attention to them, Final Expense Insurance is nothing more than a whole life insurance policy designed to cover your funeral, burial/cremation, and other related costs. In other words, they are literally your Final Expenses in this life.

Who Needs Final Expense?

We don’t like to think about it, but the truth is that we will all one day have a need for Final Expense. The last thing that we want to do is to leave that burden to family members or friends who may not have the resources to pay for the costs of a funeral. Most people who get Final Expense Insurance are aged 50 or older (some insurance companies will write Final Expense policies for people up to age 85!). Their children are grown, the mortgages are paid down, and the need for large amounts of life insurance has decreased. Final Expense plans with lower face amounts and stable premiums are a much better fit for life insurance needs at this stage of life.

What are the features and benefits of Final Expense Insurance?

Final Expense Insurance is a life insurance policy that is designed to meet specific needs such as:

• Smaller death benefit amounts to keep premiums affordable. Typically, they pay death benefits from $2,000 up to $25,000 depending on the individual need.
• Premiums do not increase over time.
• Policies remain in force up to the age of 100 or beyond if premiums are paid as agreed.
• Fewer health questions are required to qualify. Some companies offer a guaranteed issue or graded benefit plan for people who have severe medical issues although these plans do have higher premiums.
• Policies build a cash value over time that can be accessed if needed.
• Death benefits can be paid within a short period of time after a claim notification, sometimes within a matter of days. This is an important feature for families planning a funeral.
• Many carriers offer options to add additional coverage for children or grandchildren at a very low cost.
• Additional coverage may be added to accidental death or to waive premium payment in the event an insured enters a nursing home.

Should I Consider A Final Expense Plan?

Everyone needs some life insurance protection and Final Expense is a good fit for many people. Some questions to consider when reviewing your needs:

• What life insurance do I have in force right now?
• Does my current insurance have a termination date? (Hint…if you have a Term Life policy, it does!)
• Is it enough to cover the cost of a funeral, burial/cremation, final medical bills etc.?
• Do I want to leave any extra money for family members?
• Who will be my beneficiary? (This should ideally be the person(s) who you would want to handle your final arrangements)
• What premium can I comfortably afford to pay monthly?