Final expense insurance is insurance that’s designed to cover any end-of-life expenses. These could be anything from caskets to burial home charges and everything in between. As hard as the passing of a loved one can be, it can also be a financially-stressful process. Below, we’re going to look at some of the ways final expense insurance can save you money.
What is Final Expense Insurance?
Final expense insurance is a type of whole life insurance policy which, unlike a term policy, doesn’t expire after you reach a certain age. Once you have your policy, your premiums can’t increase, and the death benefit can’t decrease.
When applying for final expense insurance, you don’t need to take a medical exam or have to deal with your insurance provider accessing your medical records. It’s usually a fast, simple process to join the policy.
Upon registration, you will need to answer some health questions. Depending on your answers to these questions, your insurance provider will decide if you qualify for final expense insurance or not. It’s also because of these questions that not everyone will qualify.
The beauty of final expense coverage is that your coverage begins from day one. Once you’re registered to the policy, you’re covered.
Just like with any kind of insurance, your premiums for final expense insurance will depend on your age, health, gender, and lifestyle. Naturally, the older or less healthy you are, the higher your premium cost will be for the given amount of cover.
On average, men tend to pay higher premiums than women because men have shorter life expectancies. Smokers will also pay a higher premium because the habit has a direct effect on your health.
Depending on your policy and your insurer, there may be a minimum age requirement for when you can apply. However, some insurance providers will issue final expense insurance policies to anyone under the age of 85.
Some policies offer coverage of up to $50,000 for people younger than 55 and up to $25,000 once you turn 76.
How will a Final Expense Policy Save Me Money?
As we mentioned earlier, some final expense insurance policies can offer coverage of up to $50,000. When you contrast that against today’s average funeral costs (between $7,000 and $12,000), you quickly understand how choosing to have a final expense coverage policy can save you money.
Even when compared to your monthly premiums on final expense insurance, your average funeral will typically be more costly than the total sum of your premiums.
Some benefits of final expense insurance are:
- Less financial worries for your family after you pass
- You can borrow from it because it builds a cash value over time
- Your premium amount doesn’t change
- Coverage is guaranteed
- The policy will be upheld even if your health deteriorates
- The death benefit can be used for whatever your beneficiary decides is best, such as mortgage payments, debts, savings, and more
By covering the high costs of funerals after you pass away, a final expense insurance plan is a great way to prepare for the future and save money for when that time comes.
Another way a final expense policy allows you to save money is through its premiums.
By keeping your monthly premiums the same, there’s no room for policy or saving fluctuations. You know exactly how much to pay every month.
The same can’t be said when using a regular savings account, where some months you might save the correct amount, while others you might miss a month or deposit a smaller amount into your account.
And because the payout of a final expense insurance policy is immediate, your beneficiaries won’t need to wait 30 days to access the funds to be used to cover the expenses.
Final expense policies are great for people who want to secure and cover their funeral costs without having to sign up for a bigger life insurance policy.
Find the Coverage You Need Today
Every person is different, and everyone has different needs. To find out more about final expense insurance plans and other types of whole-life and universal insurance plans, contact our team today.