Final Expense Insurance ( also known as Burial or Funeral Insurance) is a whole life insurance policy with a lower death benefit. This is usually intended to cover final expenses and burial costs. This coverage is tailored to help older adults aged 50 years old and older who are set to make end-of-life plans. This insurance policy may cover medical bills, funeral expenses, and credit card debt. Final Expense Coverage is sometimes called simplified issue insurance or modified whole life insurance. Final Expense usually has a face value ( death benefit ) amounting to $2000 to $50,000.
Final expense insurance is easier to qualify for compared to most policies. It does not require a medical exam, and the coverage can start immediately. This is a form of permanent insurance, and if premiums are paid up to date, the benefit doesn’t expire.
Final Expense Insurance policy may be acquired as a secondary policy to complement benefits from other life insurance coverage or as a guaranteed issue plan that does not need any medical exam or let the underwriter access your medical records. However, you will have to answer some health questions. This insurance policy has death benefits designed to cover expenses, including funeral or memorial service, embalming, and a casket or cremation. In addition, this benefit can serve beneficiaries for any purpose and use however they need it.
Final Expense prepares policyholder financially to cover funeral costs such as :
- Funeral home rental fees
- funeral home costs (includes viewing, service, or memorial package)
- Transportation to and from the cemetery (when you choose burial)
- Burial expenses – such as plot, grave marker, and casket
- Embalming costs,
- Cremation costs (includes cremation casket or urn and transportation of your remains)
- Officiant fee for service
- Additionals for your final sendoff -the ceremony, music, and flowers
The payout from Final Expense Plans has no provisions that beneficiaries can use however they need. Bereaved families usually use proceeds from a final expense insurance policy to cover medical bills, hospice care, other end-of-life expenses, credit card, auto loan, other debts, day-to-day expenses, or perhaps, inheritance for their kids or grandkids.
Advantages of Final Expense Insurance
- Policies are available to applicants with poor health.
- The application process doesn’t include an examination, only a questionnaire and prescription history at the most.
- On many policies, premiums never increase (this is true for several varieties of life insurance).
- The insurer cannot decrease your policy’s benefit unless you borrow against the policy’s cash value or request accelerated death benefits (also true for other kinds of life insurance).
- Your heirs can use the benefit for any purpose (a regular feature of life insurance).
- The benefit is guaranteed as long as premiums are paid and you don’t have a term policy (also a typical feature of any whole life insurance).
- The benefit isn’t taxable (also a typical feature of life insurance).
- You can buy a policy with a benefit of $50,000 or less, and that’s all some people need or can afford.
Disadvantages of Final Expense Insurance
- Some insurance companies put confusing or misleading information in their marketing materials (this is also true for other life insurance varieties).
- Some insurance companies provide incomplete information about these policies in their marketing materials (also true for other kinds of life insurance).
- Because the policies have relatively low death benefits, you may lose money if you reside an extended time and pay more in premiums than your beneficiaries will receive as a benefit. (You also lose money once you pay term premiums and don’t die while the policy is effective.)
- Some people let their policies lapse, which implies their heirs won’t receive a benefit (also true for other styles of life insurance).
- Some final expense insurance providers use marketing scare tactics to support high average funeral costs and play on seniors’ fears of burdening their loved ones.
- Some insurers steer consumers without significant health problems toward more-restrictive and costly policies, although they will qualify for better coverage.
FAQS:
Who is eligible for final expense insurance?
Final expense insurance is typically available to people between the ages of 50 and 85, although some policies may have different age restrictions. There are usually no medical exams required to qualify for final expense insurance, and many policies can be purchased with a simple application process.
Can I choose my beneficiary for final expense insurance?
Yes, you can choose your beneficiary for final expense insurance. The beneficiary can be a family member, friend, or any other person you choose.
What happens if I stop paying my premiums?
If you stop paying your premiums, your final expense insurance policy will eventually lapse. This means that the coverage will no longer be in force, and your beneficiary will not receive a payout upon your death. It’s important to keep up with your premium payments to ensure that your policy remains in force.
Final Word:
It is essential to review the advantages and disadvantages before getting Final Expense Insurance. It is also worth noting that factors such as AGE, HEALTH, GENDER, and TOBACCO USE are considered for the final expense insurance premiums.
Taking all this information into consideration when deciding how much final expense insurance to buy is essential. Our experienced and reliable insurance agents can help you choose an option that best fits you and your family’s needs. Health Plans In Oregon is here to assist you, and there is no obligation to sign up. Call now-503-928-6918.
