Final Expense Insurance

Final Expense Insurance

What Is Final Expense Insurance?

Final expense insurance is a small whole life insurance policy that is easy to qualify for.

  • The beneficiaries of a final expense life insurance policy can use the policy’s payout to pay for a funeral service, casket or cremation, medical bills, nursing home bills, an obituary, flowers, and more.
  • However, the death benefit can be used for any purpose whatsoever.
  • The death benefit is usually somewhere between $2,000 and $35,000.
  • The average cost of a funeral ranges between $7,000 and $12,000.

Benefits of Final Expense Insurance

  • Final expense insurance can relieve the worries of your family members because it provides them with money they may need to pay expenses related to your death.
  • It can be a welcome choice for people who can't get any other insurance due to their age or health but want to ease some financial burdens for loved ones.
  • It's affordable due to the lower coverage amount.
  • This type of insurance policy builds a cash value over time, so you may borrow from it or use it as collateral during your lifetime.
  • The premium amount never changes, which can be helpful for budgeting. Coverage is guaranteed.
  • The policy cannot be canceled, even if your health deteriorates.
  • The death benefit, while aimed at final expenses, can be used for whatever a beneficiary decides is best—a legacy nest egg, mortgage payments, credit card debt, and more.
Policies are affordable
Easy to qualify. Requires answers to medical questions but no medical exam.
Premiums never increase.
Death benefit can't be decreased unless you borrow against cash value or request accelerated death benefits during your lifetime.
Heirs can use death benefit for any purpose.
Death benefit is guaranteed as long as premiums are paid and you don’t have a term policy.
Death benefit is not taxable.
You can buy a policy with a death benefit of usually $35,000 or less.
Policies are available to applicants with poor health.
Policy face amounts are lower than other types of insurance and may not meet all expenses.
Can be more expensive that other types of policies due to easy health qualification.
Some insurers can provide misleading or incomplete information, making decisions difficult.
Some policies require waiting periods, which insurers may try to obscure.
If you live long enough, total premium paid could exceed the death benefit.