pros and cons advantages
- focuses on preparing for after life. most life insurance policies are not designed to specifically address the many costs family members pay when they prepare for a funeral. caskets alone can cost up to $10,000 depending on style and material. this does not include other typical funeral costs such as transportation, body preparation, grave liners, flowers, or the headstone. A final expense policy can help with these costs and protect your family from experiencing a financial burden.
- Final expense insurance is a type of whole life policy. for With most traditional whole life policies, the death benefit and insurance premium remain the same for the life of the policy. Most whole life policies last for the life of the policyholder, and some build cash value. Whole life insurance is often called “permanent life” because the term of the policy is not limited to a specific period of time like term insurance.
- It is more affordable than many other insurance policies.
- is more affordable than many other insurance policies. because it is typically used to cover funeral costs, the coverage amount is often much less than traditional policies. On average, people insure for $10,000 – $20,000, making final expense policy premiums more affordable than larger policies.
- easy rating. Because the amount of coverage is lower than other types of life insurance policies, some final expense policies do not require a medical exam to qualify. most policies can be issued based on the answers to the health questions on the life insurance application.
One of the main drawbacks of final expense is that its face value is much lower than other types of life insurance, such as term insurance. And keep in mind that the beneficiary can use the death benefit for anything, even if you purchased the policy to help cover your funeral costs.
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do you need final expense insurance?
If you’re over 40 and need money to cover your final expenses and funeral costs, final expense life insurance is perfect. Because the policy’s death benefit (typically $5,000 to $20,000) tends to be less than the traditional insurance benefit, premiums tend to be more affordable for those on a budget.
This makes it an attractive option for seniors looking to cover their end-of-life expenses. It is a kind of permanent insurance, it does not expire if the premiums are paid, and it accumulates a cash value over time.
But this type of insurance isn’t just for seniors (learn more about affordable life insurance 50+, life insurance 60+, life insurance 70+, and life insurance 70+). of life for people over 80). Anyone worried about leaving loved ones unprepared when they pass away should consider taking out a life insurance policy on themselves. children can also buy life insurance for parents. Getting several quotes, including a final expense quote, can help you determine which type of life insurance is best for you.
If you have independent wealth or enough savings, you may not need final expense insurance. just keep an eye on rising funeral costs and always make sure you stay up to date on current costs.
If you are over 85, receiving hospice care, or currently hospitalized, you may not qualify. certain health conditions, such as a terminal illness or AIDS, may also prevent you from qualifying.
who is it better for?
This type of life insurance is best for seniors because it focuses on covering funeral costs and other end-of-life expenses. You may have seen this type of coverage offered as senior burial insurance or funeral insurance, but these are the same as final expense insurance.
final expense is best for seniors because it’s affordable, usually offers a no-exam qualification, and can help with planning certain aspects of your final arrangements (choosing a funeral home, flowers, music, etc.).
how is it applied?
All life insurance policies require you to fill out an application. Depending on the life insurance company, the application can be 1-2 pages or 5-10 pages long. the longest application will ask dozens of questions, such as the applicant’s height and weight, blood type, family history, and activity level. These companies typically require a medical exam with blood and urine tests.
Other companies, such as Lincoln Heritage, have a 1-page application and no medical exam is required. coverage is based on applicant’s answers to health questions, not medical tests.
When applying for coverage, you can often call or complete an online form to receive a no-obligation quote. your quote will be provided directly by the insurer or one of its authorized representatives. coverage can be sold over the phone in some cases, but most policies will require some form of face-to-face interaction.
Some examples of questions you may need to answer on the application cover the last two years of your health and include:
- Have you tested positive for HIV or AIDS?
- Are you currently bedridden, hospitalized, in a nursing home, or receiving hospice care?
- do you have any illness? including heart attack or heart surgery?
- do you have congestive heart failure?
- do you have a disease of the circulatory system, including stroke?
- do you have cancer?
- have you abused alcohol or drugs?
- do you have Alzheimer’s or dementia?
- are you taking medication or have you received treatment ? by a doctor for any of the above conditions in the past 2 years?
Even if you answer “yes” to one or more of these questions, you may still qualify for coverage. With final expense life insurance, most people can get coverage even if they’ve had health problems.