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What Is Final Expense Life Insurance?

We should start with a final expense life insurance definition. Only then will we have an idea it’s the type of policy you’re looking for or if another type is better.  Final Expense life insurance is a kind permanent life insurance policy that used to pay for your funeral and burial expenses. In other words, it’s life insurance for final expenses. Final expenses may also include medical costs or any other expenses that you need covered.

Final Expense Life Insurance For Seniors

Senior are often looking at final expense life insurance because it provides them a smaller life insurance policy at an affordable price. It’s designed to cover any funeral costs and final expenses. Final expense isn’t a fit for younger shoppers who are looking for a policy to cover long term goals such as income replacement and mortgage protection.

Seniors want a simple life insurance policy to cover their funeral so the burden of burial costs aren’t passed to a grieving family member. As you may know, some funerals can cost around $10,000. Anyone who has lost a loved one knows that paying for a funeral is the last thing you want to think about when you’re grieving. 

Your children or spouse will be going through a very stressful time when you die. A final expense policy is a great way to protect your family and help with the cost of your funeral. Final expense assists seniors looking to help relieve their family of the financial burdens of funeral costs.

What Are The Costs Of Final Expense Insurance?

The average costs of final expense life insurance policies is about $55 per month for the most common benefit amount of $10,000. Final expense premiums can be lower or higher depending qualification criteria such as your health, age, and gender. The amount of coverage you buy will also factor in the cost of your policy.  Final expense face amounts typically range from $5,000 to $25,000. 
For the average person, their out-of-pocket end of life costs averages to $11,618 in the last year of life. Make sure to calculate what you final expenses are to see how much coverage you’ll need. Factor in the cost of the funeral, medical bills, and any miscellaneous debts. 

How Do You Apply For Final Expense Insurance?

The application process for final expense life insurance is simple and quick. Traditional life insurance policies typically have a very long application and a medical exam. Final expense is a No Medical Exam life insurance policy where you simply answer some qualifying questions before getting approved.
Each life insurance company is unique. Some companies have more questions than others. Some qualifying questions are more strict and some are not. Your coverage opportunities are based on these questions, not on a medical exam. What if you are unable to pass any of the qualifying questions? You can purchase a Guaranteed Issue Whole life insurance policy with AIG.

How Life Insurance Covers Final Expenses

Nobody enjoys planning for their death, but everyone knows it’s inevitable. As uncomfortable as this is, it’s even worse if you don’t do it. When final expenses are not planned for properly it can create some real problems. Here are the ways that final expense life insurance can help you pay and avoid these problems.
Funeral Costs Are Not Cheap
The cost of a funeral these days isn’t cheap. As with most things these days, the prices are increasing. Will you be purchasing a headstone, casket, plot, or cremation? Will you have a service? There will be a fee for the ceremony. These are just some of the things that need to be paid for when you die. We ran the numbers and have provided you a complete expense report in the table below. 
Burial Costs Is Just One Final Expenses
Your burial is the most expensive final expense, but there are many more that you may not even be aware of. You’ll need to think about any outstanding debts such as credit cards, medical bills, and loans need to be paid. Do you have any household debts? Take a moment to calculate all of your current and future debts that your family will be responsible for if you don’t have coverage. 
Final Expenses May Impact Your Estate
Have you made a will? Do you have an estate plan? Do you know that they can be affected by your final expenses? Depending on your specific situation, you may have to pay estate taxes when you die. Your final expense life insurance policy can help your family pay for these unforeseen expenses.
Use Final Expense Funds Before You Die
Your final expense policy may build enough cash value that you can use to pay for medical costs or any other emergency expenses before you die. Medical bills often add up quickly in many end of life situations. Some final expense policies can grow cash value over time that you can access for these expenses.
Medical Bills
Our current healthcare system provides great care overall, but at a cost. Prescription costs, insurance, and medical procedures are not cheap. Even if you’re covered by Medicare, you may still be responsible for some considerable costs. Depending on your insurance, you may have accumulated a significant amount of medical debt from medications, nursing, hospital fees, co-payments, co-insurance, facility fees any more. 
Did you know that over 70% of Americans die with financial debt? That amount of debt is pretty alarming as the average balance is just over $60,000 which includes mortgage debt. These debts do not simply vanish when you die. Your estate is responsible for paying off debts in the majority of cases. This occurs prior to any assets being allocated to your loved ones. 

Final Expense Cost Report

Let’s look at the average costs that you may be facing when planning for final expenses. It’ important to calculate all of the fees and costs below as well as any household debts that you have. You’ll quickly see that a final expense policy is a good way to make sure your family isn’t stuck with this financial burden. 
Casket – $500 to $11,000
Vault – $500 to $14,000
Urn – $100 – $3,000
Flowers – $50 – $2,000
Grave Plot – $500 to $11,000
Grave Monument – $500 to $11,000
Basic Cremation Package – $500 – $3,500
Basic Funeral Services Fee – $1,000 to $5,000
Funeral Facilities Fee – $500 to $2,000
Embalming – $700
Body Preparation – $200
Service Vehicle(s)– $100 to $500
Hearse – $250
Transportation of the Deceased – $200 to $500
Memorial Service – $150
Total Expenses – National Average is $11,618

What’s So Great About Final Expense Insurance?

Every type of life insurance has its pros and cons. Final expense life insurance is a good choice if you’re looking for a relatively affordable premium. This is especially true if you’re on a budget or fixed income. Final expense can be purchase easily online and over the phone. It doesn’t require a medical exam and it a much simpler application process compared to traditional term or whole life policies.

What’s So Bad About Final Expense Insurance?

Unfortunately there are some drawbacks to final expense. When comparing final expense policies to other types of life insurance, final expense provides smaller face amounts. The premium costs per $1,000 of coverage is also more expensive compared to other policy types. For example, if you compared the premiums of a $25,000 final expense policy to a 10-year term life policy, the final expense policy would typically be more expensive.

Final Thoughts

There are so many final expense policies available to shoppers. Which policy is the best one for your situation? Which final expense policy will provide the most protection for your loved ones? Which company pays claims fast and without any hassles? These are just a few of the questions to think about before you apply for a final expense policy. Find your policy today with our Quote & Apply Life Insurance quoting technology today or contact us to speak with a Broker.

Final Expense Life Insurance

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Looking for a Guaranteed Issued Whole Life Policy? Contact Us for a quote with AIG.

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