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Final Expense Life Insurance

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 Final Expense Life Insurance, get the details on how a final expense policy can help cover your loved ones from unexpected burial expenses and the pain that comes with them.  Enter your information above to get pricing or call us at 844-528-8688 for a personalized quote. 

Since we all know that when we die someone will typically be responsible for arranging or paying for our funeral, it makes sense that we attempt to take care of this in advance. No one wants to leave the burden and stress of arranging and paying for a funeral to their surviving loved ones.

If it’s important to you that your final expenses will be covered by a life insurance policy rather than your surviving loved ones, then keep reading to learn how simple and affordable it can be for you to take care of your final expenses before you pass away.

What is Final Expense Insurance?

Final expense insurance, which is also referred to as funeral insurance or burial insurance, is a whole life insurance policy that is designated to pay for the final expenses that are associated with dying.

Generally, these expenses include funeral and burial costs, unpaid medical expenses, and nursing home or hospice fees that are not covered by health insurance or Medicare.

To be clear, Final Expense Life Insurance is not a type of life insurance but rather a purpose for a life insurance policy. In fact, after you purchase final expense insurance and then receive your policy, the term “final expense insurance” is typically not stated on the insurance policy.

There are three basic types of life insurance products but the one used for final expense insurance is typically whole life insurance. Whole life insurance makes a great foundation for your final expense insurance for three great reasons:

  • Whole Life provides coverage for Life – Your whole life insurance policy will remain in force over your lifetime, unlike term insurance which most policyholders generally outlive. Your insurer cannot cancel your whole life insurance policy unless you do not pay the premiums.
  • Whole Life Insurance has Level Premiums – With a whole life policy, once your policy is issued, the insurer cannot increase your premiums for any reason. Even if you become terminally ill or need to live the rest of your life in a nursing home, your insurance premiums will remain the same.
  • Whole Life Insurance builds Cash Value Just like a traditional whole life policy, your final expense insurance policy will build cash value over time that you can access for any reason through policy loans, withdrawals, or by surrendering your policy. In fact, even if you take a policy loan, your cash value continues to build cash value and earn interest because the loan is made by the insurer and your cash value remains intact.

Why Should I Buy Final Expense Insurance?

Since final expense insurance was designed for the senior marketplace, the insurance companies allow liberal underwriting guidelines, lower face amounts, and typically never require a medical exam or blood/urine test. These policies are very easy to buy and in most cases, very affordable to the policyholder.

Final Expense Life Insurance should be considered even if you have other life insurance because the policy will always be available when needed. Many seniors who are still working have group life insurance through their employers that typically will cancel once you leave your job.

At this point, finding affordable life insurance can be very difficult because of the impact on pricing by health issues that may have developed over your years of working.

Seniors who are in the following categories should consider final expense insurance as a means of covering their final expenses rather than passing them on to surviving loved ones:

  • Seniors who have term insurance policies that will expire before age 70
  • Seniors who may have surrendered their life insurance policies during the last recession in order to make ends meet.
  • Seniors that have life insurance through work without any other individual life insurance coverage.
  • Seniors who have not considered life insurance because they have serious health issues and assume they would not qualify.

How does Burial Insurance Work?

As we explained earlier, final expense life insurance or burial insurance is like any other life insurance but has a specific purpose:  pay for your burial expenses when you pass away.

Normally the applicant will name a trusted family member or friend to be their designated beneficiary and use the death benefit to pay for funeral expenses and other lingering expenses such as unpaid medical bills or nursing home expenses.

It’s important to note that your beneficiary can use the death benefit in any manner they choose, so it’s important to designate someone you trust and speak to them about your final expense insurance either before or soon after you purchase it.  

Most insurance companies will offer coverage from as low as $2,000 and up to $50,000 depending on your age and the company you select. Although you will not be bothered with a medical exam, there will be a number of health questions on the application that must be answered truthfully.

Do I Have to Medically Qualify for Final Expense Insurance?

To qualify for the most affordable rates, you will have to medically qualify for coverage. This means that your answers to the medical questions on the application will determine if you qualify for the lowest rates. The good news is that most insurance companies offer three types of final expense insurance products so that every senior (up to age 85) can qualify for a final expense insurance policy.

  • Level Benefit Plan – With the level benefit plan, your final expense life insurance coverage starts the day your policy is approved and issued. There is no waiting period and your premium is going to be the lowest among the three types of plans.
  • Graded Benefit Plan – The graded benefit plan is available for applicants who do not medically qualify for a level benefit plan. “Graded benefit” means the full death benefit is not available until after a waiting period of 2 or 3 years.

For example, Richard did not qualify for a level benefit plan and was offered a graded benefit plan with a $15,000 death benefit. If Richard should die in the first year, his beneficiary will receive 25% if the death benefit or $3,750. If Richard passes away in the second year, his beneficiary would receive 50% of the death benefit or $7,500. If Richard dies in the third year the beneficiary would get 75% of the death benefit or $11,250. If Richard dies in the fourth year of later, his beneficiary would receive 100% of the death benefit.

  • Guaranteed Issue Plan – The guaranteed issue plan should be considered your last resort because it is more expensive than the level benefit and graded benefit plans and there is a two or three-year waiting period when the company will not pay the full death benefit if your death is due to natural causes. They will, however, pay the full death benefit if your death is the result of an accident.

During the waiting period, your death benefit will be equal to the amount of premium paid to the insurance company plus an additional percentage of 5 or 10%. Although this plan has a waiting period and is somewhat pricey compared to the level benefit plan, you will not be denied coverage for any health issues as long as you are in the eligible age group.

How Do I know How Much Final Expense Life Insurance to Buy?

The majority of your final expenses after you pass away is going to be your funeral and burial expenses. Although we cannot determine how much if any, your medical or nursing home expenses will be, we can get very close on the funeral expenses.

There are several really good resources on the internet that will help you estimate your funeral costs based on the area you live in. One of the resources that we recommend is Parting.com because they offer substantial information about funeral planning and the costs involved. Here is what an average funeral and burial service will cost and the services involved according to Parting.Com:

“Today, the average North American traditional funeral costs between $7,000 and $10,000. This price range includes the services at the funeral home, burial in a cemetery, and the installation of a headstone. While cremation is gaining in popularity, the traditional funeral is still the most popular manner for disposing of the deceased.

Here is a reasonable "ballpark" estimate of the main funeral costs.

It's important to notes that funeral prices vary considerably between funeral homes and geographic areas of the country,

    • fee for the funeral director's services: $1,500
    • cost for a casket: $2,300
    • embalming: $500
    • cost for using the funeral home for the actual funeral service: $500
    • cost of a grave site: $1,000
    • cost to dig the grave: $600
    • cost of a grave liner or outer burial container: $1,000
    • cost of a headstone: $1,500

In the above example, total costs would approximate $9,000....and that's just for the "main" items. There could be additional charges for things like placing the obituary in the newspaper and buying flowers.” Read the Article

This provides you with an average cost so you can get an idea of your starting point. Your cost will be impacted by the area you live in and any additional services you would like to add to your service. It’s important to note that arranging a funeral service is like buying a wedding dress and the seller always has the advantage. If you plan ahead and leave your “last wishes” with your beneficiary, they will be less likely to be taken advantage of.

Final Expense Insurance Companies

There is no "one size fits all" when is comes to final expense life insurance.  What company and plan fits you the best will depend on your location, health and budget.  For this reason we carry several of the top rated final expense insurance companies, this ensures that we find the right plan at the right price to fit your needs.  See the review page of our best final expense insurance companies.

What Should I Expect to Pay for Final Expense Insurance?

The cost of your Final Expense Life Insurance will depend on your age, your health, and your death benefit. We can however offer actual quotes for a level benefit policy.

These rates are based on a $20,000 death benefit for a male and female non-smoker living in Wisconsin:

Age of Applicant

Male Non-Smoker

Female Non-Smoker

50 years old

$55.11

$45.32

55 years old

$67.60

$51.66

60 years old

$83.56

$64.07

65 years old

$106.61

$81.80

70 years old

$142.06

$103.06

75 years old

$195.23

$142.06

80 years old

$262.11

$193.66

As you will notice, the life insurance costs for men are higher than the costs for women. This because women typically live longer than men and therefore the insurer will have more opportunities to collect premiums. Also, the rates get higher as you get older so the rates will never be lower than they are today.

How Will I know Which Final Expense Plan is Right for Me?

The best Final Expense Life Insurance plan will be one that is provided by an insurance company that is highly rated, delivers outstanding customer service, pays claims as quickly as possible, and offers rates that you can afford.

Here is when LJM Life Insurance can advocate for you. We are independent agents who specialize in “senior products” will typically represent at least six of the most competitive insurance companies and will also offer level benefit, graded benefit, and guaranteed issue plans.

Since we are independent insurance professionals we represent multiple companies, and are not “captured” by any one company that only accepts “cookie-cutter” applicants. In other words, we are happy to work on unusual cases that might be tough to issue.

Your independent LJM Life Insurance agent will shop your application with all of the companies they represent and then deliver the best insurance solution for your circumstances and monthly budget.

Your LJM Life Insurance agent will usually know in advance the companies that have an appetite for your particular health issues, they will walk you through the application process, and they will do everything possible to get your policy issued. Remember, your agent is paid by the insurance company and they are only paid after a policy is issued and a down payment is collected.  Call 844-528-8688 today for a free, unbiased final expense life insurance consultation.