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Final Expense Life Insurance – What Makes It Different

The hardest thing we can ever face in life is usually the demise of a loved one. But besides the emotional stress, we also have to take care of end-of-life medical costs and funeral expenses. Such a combination can be very draining, both mentally and physically, to the surviving family. To relieve some of the pressure, final expense life insurance was created.

But with all the different types of life insurance products that seemingly overlap in terms of coverage, what makes final expense insurance unique?

Focus on Life Preparedness

Typical life insurance policies usually don’t have specific coverage for funeral preparation costs. Caskets alone can cost as high as $10,000 or even more, depending on style and aesthetics. This does not include flowers, transportation, preparation of the body, headstone and many more. Final expense insurance lets the family deal with and eventually overcome their grief without worrying where to get the money to cover the bills.

A Type of Whole Life Policy

In traditional whole life insurance, the death benefit and insurance premium are often the same all throughout the policy’s life. These policies usually last the whole life of the policyholder and may build some cash value too. Whole life insurance is sometimes referred to as permanent life because it has no timeframe limits as opposed to term insurance.

Cost Effectiveness

Since final expense insurance is intended for funeral costs, its coverage amount is generally less than that of conventional policies. People usually spend some $10,000 to $20,000 to insure themselves, so final expense insurance premiums are notably more affordable compared to bigger policies.

Simple Qualification Process

Because the coverage amount is less than most types of insurance products, some final expense policies require no medical tests for qualification purposes, and are simply based on an applicant’s answers to questions on their form.

So who needs final expense insurance? First of all, remember that final expense insurance is permanent insurance, meaning it has no expiration (as long as premiums are paid) and maintains a cash value over time. With its death benefit only amounting to $5,000 to $25,000, which is way less than traditional insurance, it is generally more affordable. This makes final expense policies attractive to seniors who want their families spared from the burden of paying for their end-of-life expenses.

On the other hand, final expense insurance isn’t only good for seniors. Anyone who doesn’t want to leave their families financially unprepared should consider getting this policy. By asking different providers for quotes, including a final expense quote, will make it easier to find the best policy for one’s needs and budget.

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