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Final Expense and Burial Insurance

 

For anyone who watches television, there have been many commercials about final expense and burial insurance for seniors and others who may have been denied coverage because of health issues. Colonial Penn and AARP come to mind when you consider national advertising and there are likely more commercials that are aired on a regional basis.

The issue with these television ads is not that they are misleading; it’s that interested viewers get minimal information about these important products when the commercial is less than a few minutes long. Unless an interested viewer calls to a toll-free number or stops what they may be doing to visit a website, they will not have a clear understanding of the features of final expense and burial insurance and how it can benefit them and their families.

If you have put off purchasing life insurance, there is no better time than now to make certain that you do not leave the significant costs of a funeral, cremation, or burial to surviving loved ones. We are available to consult with you and find an insurer who is willing to issue an insurance policy without regard to any health issues and up to age 85 years-old.

In our effort to help educate the public about this very important insurance protection, we’ve listed the most popular and frequently asked questions when interested people have called our office:

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What's the difference between final expense insurance and burial insurance?

There really is no difference in the insurance product used for either financial risk Final Expense insurance will typically cover funeral and burial costs, but burial insurance will typically not cover all final expenses.

What is a Final Expense Policy used For?

Burial insurance is a whole life insurance policy that is used specifically for paying the costs of a funeral that may or may not have been prearranged by the policyholder. Many people purchase burial insurance so that the costs of their funeral will not be paid by other insurance policies that they might own,

How much Burial Insurance do I need?

The amount of burial insurance you will need depends on the costs of the funeral or cremation that you prefer. Currently, the average cost of a funeral and burial is about $10,000 combined. In most cases, we have found that a cremation with a memorial service costs about half of a moderately priced funeral. There are, however, different steps you can take in advance to reduce the costs of your funeral or cremation. 

What is a Final Expense Policy used For?

Burial insurance is a whole life insurance policy that is used specifically for paying the costs of a funeral that may or may not have been prearranged by the policyholder. Many people purchase burial insurance so that the costs of their funeral will not be paid by other insurance policies that they might own,

How much final expense insurance should I buy?

It is a little more difficult determining what final expenses you may have other than funeral costs. In many cases, there are expenses related to medical costs and nursing home expenses as well as debts that could be charged to the insured’s estate. Your insurance agent will be available to help you get an idea of how much death benefit will be needed so that no expenses will be passed on to surviving loved ones.

Is a final expense policy similar to a regular whole life policy?

Yes, the final expense whole life policy has the same attributes as a traditional whole life policy except for the waiting period. The policy coverage is guaranteed for life as long as the premiums are paid. The periodic premium is never increased for the life of the policy, even when the insured ages or becomes ill. The policy builds cash value that can be accessed through a policy loan or surrender. The insurance company cannot cancel the policy as long as the required premium is paid.

Can I buy Final Expense and Burial Insurance if I have medical issues?

Although being in good health will help you to qualify for lower rates, you can purchase final expense or burial insurance even if you have serious health issues. When health issues are a challenge, your agent will recommend a guaranteed issue policy which means that there are no health questions or medical exam requirement for getting coverage.

What is a guaranteed issue insurance policy?

A guaranteed issue insurance policy is a whole life policy that is issued without regard to the applicant’s health. With this policy, there are three caveats that the applicant must consider and accept.

  1. The death benefit is usually capped at $25,000 to $30,000 depending on the age of the applicant.
  2. The insurer will typically apply a waiting period of 2 or 3 years before they will pay the full death benefit if the death is a result of natural causes. If, however, the insured’s death is the result of a covered accident, the company will pay the full benefit.
  3. The rates for a guaranteed issue policy are much higher than a traditional policy since the insurer is accepting an unknown risk.
Does my beneficiary have to use the death benefit for my funeral or cremation?

Unless you assign your insurance policy to a funeral home, your beneficiary can use the death benefit in any way they choose. Knowing this, it makes very good sense to select a beneficiary you trust and has promised to use the death benefit according to your wishes.

What companies offer the best final expense and burial insurance policies?

The most efficient way to purchase your final expense or burial insurance with the most affordable rate is to contact an independent insurance professional who represents all of the national insurance companies that offer final expense and burial insurance. Your agent will learn through an interview with you which company will provide the most affordable insurance solution that best meets your needs. He or she will walk you through the shopping and underwriting process and be available to answer all your questions and help you get your insurance policy issued.

Our final expense policies are available with additional riders that you can add to your policy in order to meet your individual needs:

Accidental Death Benefit

This rider provides for the insurer to pay a multiple of the death benefit (usually double) if the insured dies as a result of an accident.

Waiver of Premium Rider

Waiver of Premium provides for the insurer to waive periodic premiums if the insured becomes disabled and is unable to work.

Accelerated Death Benefit

The Accelerated Death Benefit provides for the company to pay a portion of the death benefit to the insured if he or she is diagnosed with a terminal illness that is likely to cause death within two years.