Everything You Need To Know About Final Expense Insurance

Written by Jeff Root

Death is a topic that people do not like to discuss or think about in detail. This is why it is common to see the dependents of the deceased trying hard to take care of the funeral needs on their own.

If you think the funeral costs amount to nothing, think again. Today, an average funeral costs around $9,000. It can be difficult to arrange this amount if you don’t plan. Hence, experts recommend investing in an insurance policy that will cover all your funeral-related expenses.

Even if you have enough funds to pay off your bills and support your family throughout your life, you need to make sure that you have planned for your funeral as well. Final Expense Insurance can also be purchased for parents, with their consent. Insurance companies have come up with a Final Expense Insurance that lets your loved ones grieve the loss without having to worry about the finances.

What Is Final Expense Insurance?

Final Expense Insurance is a policy that covers not only your funeral but also all your end-of-life expenses. This includes your final medical expenses, credit card debt, and funeral costs.

Final Expense Insurance will also take care of your burial service to help your loved ones financially while preparing for the service. How much value your Final Expense Insurance has depends on what kind of a funeral you desire. However, a Final Expense Insurance does not cover you for more than $20,000.

Why Final Expense Insurance Is Important

The cost of funerals has been rising continuously and could reach $17,000 by 2030. If you have been living your life comfortably, it makes sense to plan for a great departure as well. The only certainty that an individual has in life is about leaving one day. This is why it makes sense to address the event beforehand and prepare for it accordingly.

The Benefits Of Final Expense Insurance

  1. Because the maximum coverage is up to $20,000, Final Expense Insurance is a relatively cheaper option than other types of insurance covers. The premium is affordable and therefore investing for a funeral is not significantly hurtful to your life savings.
  2. As mentioned earlier, by having an insurance policy that supports your family throughout such a difficult time helps them remain at peace. You will be doing a huge favor to your loved ones by financing your funeral expenses at a time when they are mourning your loss.
  3. Due to the coverage amount being lower than in the case of other insurance policies, the qualification process is also relatively easy. You might not need to get a thorough medical exam. You can qualify for Final Expense Insurance just by answering a few important questions about your health.

What Does Final Expense Insurance Cover?

As mentioned earlier, a final expense insurance offers coverage beyond your funeral expenses. Final expense insurance covers:

Medical Bills

Nobody knows when or for how long they will remain in the hospital before their ultimate departure. Too many times the families of a deceased have to deal with overwhelming medical bills, a situation that you can avoid with Final Expense Insurance. The coverage of such a policy also extends towards paying the hospital bills.

Burial & Funeral Expenses

According to the National Funeral Directors Association (NFDA), the total expense associated with burial and funeral came out to be $8,755 for the year 2017. It is extremely difficult for the family of the deceased to come up with such a significant amount. Luckily, the prime focus of a Final Expense Insurance is to help the loved ones finance such expenses.

Other Expenses

Other than the expenses mentioned above, there are also additional costs you have to be mindful of.

A Final Expense Insurance Policy takes care of all the following expenses:

  • Casket – $2,500
  • Grave Site – $1,000
  • Grave Digging – $600
  • Body Pick-up – $300
  • Preparation of the Body – $200
  • Memorial Service -$150
  • Headstone – $1,500

What Is The Difference Between Burial Insurance And Final Expense Insurance?

One would expect the burial insurance to cover all the necessary end-of-life expenses. However, there is a difference between a burial insurance and final expense insurance. While the coverage amount for both the insurance policies lies in the same range, the purpose of each differs considerably.

A burial insurance covers only the expenses related to the funeral itself whereas final expense insurance also includes other important expenses such as medical bills. Therefore, you should view Final Expense Insurance as wider coverage that can give your family members immense support while taking care of all the expenses incurred during this difficult time.

Who Is Eligible For Final Expense Insurance?

Final expense insurance does not require you to fulfill many requirements.

There is no medical exam, and therefore individuals in the 50 to 85-year age bracket are suitable for such a policy. However, there are strict rules for people who are not eligible for a Final Expense Insurance policy.

These rules vary across different companies, but generally, they are the same throughout the industry.

Who Is NOT Eligible For Final Expense Insurance?

The following criteria disqualify applicants from receiving coverage in most cases:

  • Individuals who are over 90 years old are generally ineligible for such a policy.
  • People staying in hospice care also do not qualify for a Final Expense Insurance.
  • If you are interested in hobbies considered dangerous to your health and well-being or have a medical issue that is serious, you might not qualify for such an insurance policy.

How To Choose The Best Final Expense Policy

There are many insurance providers in the market and the decision to choose the right one can seem overwhelming. You will need to shop around for Final Expense Insurance since each provider has a different set of requirements. Finding one that is suitable for your condition requires you to research a bit.

In addition to that, you need to educate yourself about the contestability clauses of each provider. These clauses can sometimes fail to provide your loved ones with the coverage in case you die within a particular period. Knowing all these details is important if you want to protect your family from funeral-related worries after your demise. You should also look for a payment plan that is easy and fit for your current financial situation.

The 8 Best Final Expense Insurance Companies

Before we dive into the in-depth coverage offered by our best final expense insurance companies, here is a brief outline of who made our top 8.

Company A.M. Best Rating Customer Reviews
AIG A+ 4.3 / 5
Americo A 3.7 / 5
Assurity A- 3.9 / 5
Foresters A 4.0 / 5
Gerber A 4.1 / 5
Mutual of Omaha A+ 4.2 / 5
Transamerica A+ 4.0 / 5
United Home A- 3.9 / 5

1. American International Group (AIG)

In 2017, AIG introduced a new Final Expense Insurance plan that eliminated the need for any comprehensive health exams. That one factor of no comprehensive exam had made this policy one of the most popular ones among citizens.

It is available for individuals belonging to the 50 to 85-year age bracket and provides coverage of up to $ 25,000. According to the policy, the grieving family can receive 110% of the premiums that the policyholder pays in case the insured individual dies within two years of the starting of the plan. If the insured passes away any time after that, the family gets the full payout.

2. Americo

Individuals in the 50 to 85-year age bracket can opt for a policy that grants coverage of up to $30,000. In case the insured individual is diagnosed with a serious illness, the company pays 50% of the coverage amount. However, this policy requires the individuals to take a comprehensive health exam before their approval.

3. Assurity Life Insurance Company

Assurity offers Final Expense Insurance plan to the 40-80 years individuals. It provides coverage of up to $25,000 for individuals in the 66 to 80-year age bracket and up to $50,000 to people up to 65 years old. The initial review is not that strict and requires you to answer some health questions.

However, you should not be suffering from a life-threatening condition at the time of applying. The average premium for coverage of up to $50,000 is below $199.

4. Foresters Financial

Foresters Financial’s Final Expense Insurance plan is available to individuals in the 50 to 80-year age bracket. The maximum coverage amount is $30,000.

Its affordable premiums make it a cost-effective insurance policy. You need to answer some simple questions about your health to be eligible for this plan.

5. Gerber Life Insurance Company

Gerber is another popular name in the list of Final Expense Insurance policy providers. The company does not require interested individuals to answer lengthy health-related questions and is free of comprehensive medical exams.

The coverage of up to $25,000 is available for individuals in the 50 to 80-year age bracket. An accidental death benefit gives the family members a full payout in case of an accident leading to death.

Other than that, if the insured individual dies within the first two years of the policy, the family will receive an amount equivalent to all the premiums paid and an additional 10 percent. For males aged 50, the premium for coverage of $25,000 will be around $94 and for a female, $68.

6. Mutual of Omaha

Cash value is the most attractive part of the final expense insurance policy from United of Omaha Life Insurance. By undergoing a background check, you can be eligible for coverage of up to $40,000.

The policyholder receives a portion of this benefit in the case of a terminal illness diagnosis. The person can also be eligible for receiving this share if he/she is under hospice care.

7. Transamerica Life Insurance Company

Transamerica is another well-known name that has gained popularity for its affordable Final Expense Insurance policy. There is no waiting period for the beginning of the coverage, and the premium remains unchanged as the insured ages.

Transamerica offers three insurance policies and the agents’ help you determine which one is best for your unique needs. The quotes according to a comparison done in February 2017 for a 50-year-old male are as follows:

Term $25,000 $50,000 $100,000
10 Years $11/mo. $20/mo. $26/mo.
20 Years $14/mo. $26/mo. $36/mo.
30 Years $21/mo. $40/mo. $63/mo.

8. United Home Life Insurance Company

The coverage option for the final expense insurance plan offered by United Home Life Insurance Company ranges from $5,000-$100,000. However, for individuals belonging to the 60 to 80-year age bracket, the upper limit for the coverage is $50,000 only.

The company requires individuals to answer generic questions about their health. For an average 60-year-old man, the premium for a $50,000 coverage is $206 and for a woman, $159. Individuals that are not suffering from serious medical conditions should opt for this policy.

How We Decided On Our Best Final Expense Insurance Companies

There are a few factors we used to determine the best final expense companies:

Financial Stability

When it comes to life insurance coverage, you want to go with a trusted company that you know you will be able to rely on in the event of your death.

The last thing you want is an unreliable life insurance company leaving your family in the wake of your death without the proper coverage.  All of the companies on our list have long histories and prestigious financial ratings.

Customer Reviews

Well, of course, life insurance company reviews come into play!  For each company, we combed through hundreds of reviews to make sure that negative ones were the exception.

Every life insurance company will get bad reviews, as they are unavoidable in this industry.  But we wanted to make sure the best final expense insurance companies had the best reviews as well.

Best Final Expense Insurance Rates

Lastly, we chose companies that have very competitive market rates for final expense insurance across multiple risk classes.  All of these companies on our list have some of the best rates for final expense insurance.

Everything You Need To Know About Final Expense Insurance – Wrapping It Up

It is not advisable to wait to make up your mind about your funeral and its related expenses until some bad news comes from the doctor. You should start researching today and find out which of the providers are offering a policy that fulfills all your needs.

Knowing that you will protect your family even after your demise is incredibly satisfying. Moreover, the fact that you will not burden your family for your funeral is a huge advantage of having such a policy.

It is true that the sales agents will try to sell you a whole life insurance plan without mentioning a final expense insurance policy. However, a life insurance policy might not have the same level of utility for everyone.

Costly policies, unaffordable monthly premiums, unstable professional career, etc. can be some of the reasons why you might not be interested in a life coverage. Despite these challenges, a final expense insurance makes sense because it is affordable and a big favor to your family.

The Benefits Of Working With An Insurance Agent

Applying for any type of life insurance is a big financial step for anyone.  Naturally, you want to make sure you take all the actions necessary to ensure you are making the right decision for you and your family.

While comparing final expense insurance rates online is as quick and easy as point and click, each company and policy has their own nuances that are essential to understand.

An insurance agent can give you advice based on your specific situation and the coverage you are looking for.  Best of all, it’s entirely free.  Skip the hassle of trying to comb through hundreds of options, work with an insurance agent today!

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About Burial Insurance Coverage
About Burial Insurance Coverage

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