Thinking about your funeral is not pleasant at all. Wondering who is going to pay for your final send is even more unfathomable. However, the need remains.
When you move on from this life, you do not want to burden your loved ones. Burial insurance can make your funeral much easier for your family and friends.
Planning for your burial is not an awful thing to do. It is not much different from any other financial plans you have put in place. You can even liken it to planning for your retirement.
An average funeral costs about $7,848. It is an expense that can put a strain on your loved ones if you pass away suddenly. And in a situation where you are terminal, it can stress you too.
While buying final expense insurance is always an option, deciding to do it is not easy. Once you decide, you’ll then need an ideal burial insurance provider.
There are plenty of final expense insurance companies. If you aren’t sure which one would suit you, this guide is for you. It will outline for you everything you need to know about final expense insurance.
Table of Contents
What Is the Last Expense Insurance?
Also known as burial insurance, the last expense is a financial product that covers your burial expenses, and other related costs, when your life ends.
Final expense policies work under the same principle. However, some slight differences set them apart.
Who Is It Best For?
Funeral insurance is ideal for anyone who wants to protect their loved ones from the financial difficulties of a burial. Mutual of Omaha final expense insurance is mostly for people aged 45 to 85 years. There are no issuance limitations for your and healthy people.
You may also need to consider the Mutual of Omaha living promise if;
- You have not bought any life insurance
- You are grappling with debt
- Your savings cannot cover your burial expenses
- Your family and friends do not have the financial resources to pay for your funeral
- You prefer a separate insurance policy to cater to your final expense
- You have cash but don’t want your family to use cash for your funeral expenses
The benefits are directly paid to your beneficiaries when you pass away. Premiums are likely to increase as you age. It is best to buy a funeral insurance policy early in life.
The Importance of Burial Insurance
When you die, your family needs time to mourn you. You also deserve a decent send-off. When they worry about your funeral expenses, they miss an opportunity to mourn you as they wish.
Funeral insurance relieves this financial burden. Your family and loved ones get the chance to mourn you in peace.
Final expense insurance for seniors is inexpensive when compared to most pre-burial plans. It allows for determining the immediate beneficiary. You could list your spouse, sibling, or your children as beneficiaries.
Funeral insurance covers all the funeral costs, regardless of how you want to be interred. Whether your preference is cremation or burial, Mutual of Omaha final expense insurance will cover you.
Although funeral insurance is meant for the burial process, your loved ones can use any money that remains for other expenses.
Your funeral insurance is not limited to a particular location. Even if you move to a different state, the insurance will still cover you.
Burial insurances reserve the right of its ownership to you. If down the road you find a more affordable funeral home, the difference belongs to your chosen beneficiary.
Steps to Follow When Buying Burial Insurance
Buying burial insurance needs some careful considerations. And if you don’t know where to start, here are some steps that will guide you.
Estimate Your Potential Total Funeral Costs
Preparing financially for your funeral is a prudent decision. Estimating how much it might cost to lay to rest is a good place to start. Although there might be other related expenses, the funeral expense is always the highest.
The other expenses that you need to note may include pending medical bills, credit card debts, legal expenses, and so on.
You want to make sure that you capture all expenses that may arise when your life ends. Keep the total estimate in mind because you will need it during the purchase of funeral insurance.
Examine Your Finances
The second step is to go over your finances to determine if you can cover your final expenses independently. If you cannot do it alone, the services of your financial adviser will come in handy.
The question to ask is whether the money you will leave behind is enough to pay for your funeral expenses. Remember, funeral homes and cemeteries require payment right before the funeral. If your estate is held up in probate, the funds for the funeral process will be unavailable.
After your death, other unforeseen bills may arise. Think of the potential extra expenses that may arise and make payment arrangements.
Make the Big Decision
After the first two steps, you now have a clear picture of your finances. If there is a need to buy funeral insurance, it is the right time to make your decision.
Even with enough money to pay for all expenses, you may not want the costs to interfere with your estate.
The features of good burial insurance will include;
- Premiums that remain the same as you age
- No medical tests
- An insurance company with a solid rating such as A-(Excellent)
- A policy that will stay in place until your demise and accumulate a cash value
Buying final expense insurance will be the best solution to keep this from happening. There are many affordable burial insurance policies for seniors.
Determine the Best Type of Insurance for You
Most final expense policies will only pay enough for the funeral. If there are other associated costs, these types of insurance may fall short. And this would force your loved ones to pay for unforeseen expenses from their pockets.
While marketing, most burial insurance claims to cover $25,000 to $50,000. The amount is not much different from common whole life insurance that covers $50,000 and more.
Guaranteed Issue Policy and Simplified Issue Policy
Guaranteed issue policies have no reservations. The provider will not ask you any questions regarding your health. These policies accommodate everyone.
You are likely to pay more for a guaranteed issue policy because the company assumes more risk. If you feel like your health will decline towards the end, this is the best policy for you.
As for the simplified issue policy, the insurance company will ask questions in regards to your health. Burial insurance limits are always higher than any other type of policy. For this reason, the provider will not ask for a medical examination.
An insurance company may decline your request for a simplified issue policy on medical grounds. If you have a pre-existing condition, or you are a regular smoker, your application may be unsuccessful.
Modified Benefits and Level Benefits Policies
The Level Benefit policy is a full death benefit. However, the approval process is dependent on your medical history.
As soon as it is issued, the Level Benefit Policy is available for use. It does matter whether your death came as a result of an accident or natural causes.
The Modified Benefits Policy is a lot more different. For instance, the full death benefit is only available after a restricted period. The restriction period can be 24 or 36 months.
If you die before the specified time elapses, your loved ones will only receive partial benefits.
When you die due to an accident, the policy provider may pay the full death benefit. But when you die naturally, your family will not receive the full death benefit.
Choose the Best Final Expense Insurance
Now that you are conversant with what funeral insurance entails, you need to know how to choose the right policy. The best choice should be suitable for you and your loved ones.
Don’t go for the best deal because the insurance industry is well regulated. The provider you prefer will not give you any discount. If you come across any company promising superb deals on burial insurance, be wary of it.
Make sure you understand all the insurance terms and conditions. It is the only way to ensure everything goes to plan, even when you are not there. Reading a few final expense insurance reviews may come in handy.
Funeral service providers and their agents sell burial policies. You could also get your last expense coverage through an exclusive or independent insurance agent. AARP final expense insurance is worth taking a look at.
Start Paying for Your Burial Insurance
Once you are confident that you’ve found the right insurance company. Fill the forms and start paying for your final expense. There are many ways to pay your premiums, which include;
- Monthly payments
You can use a debit or credit card to make the payments. Other people prefer a direct withdrawal from their banks.
You are not required to pay the first premium right after you apply. Most companies will let you choose one day of the month for remittance of funds. The insurance firm determines the mode of payment.
Types of Funeral Insurance Premiums
When it comes to funeral insurance, people want to know what the premium structures look like. In this section, we will cover the 4 types of burial insurance premiums.
Stepped premiums increase as you age. The insurance company calculates them each as you renew the policy. These premiums hinge on the amount of your death benefit, your sex, and your age.
Leveled premiums will not increase unless you default. The insurance company determines these premiums based on the size of your policy, your sex, and your age.
The insurance company sets capped premiums at a particular amount. Once your payments reach the capped level, you stop paying the premiums. However, your coverage remains active.
Payout Guaranteed Premiums
With payout guaranteed premiums, your beneficiaries may receive a sum that is equivalent to the premiums you have paid. They can also receive the original insured amount.
Preneed insurance is another viable policy that covers funeral expenses. The contract is unique. Your family can only access funeral goods and services from a predetermined provider.
The risks involved in this arrangement are high. You need to carefully choose a trustworthy provider. The best aspect of the preneed insurance is locking up a cost today, which could change in the future.
Also, you can transfer the burial insurance to another funeral provider. But you should first confirm this with the insurance company and the funeral home.
Benefits of Burial Insurance
If you have considered buying funeral insurance, you made the right decision. Burial insurance offers more than a financial reprieve.
Many people think and worry about their funeral. They wonder if their loved ones will afford the send-off process. Buying funeral insurance alleviates these troublesome thoughts.
Not everybody gets the chance to plan a funeral ahead of time. With a funeral insurance policy in place, you can plan for even the slightest details. If you do it with a funeral home in conjunction, you can choose how you want your remains to be interred.
Some people worry that their families will not give them the send-off they deserve because of financial hardship. Buying last expense insurance ensures that you get a funeral of your choice.
Buy Your Burial Insurance Today
After reading this guide, you are more than ready to take the next step. For further guidance and burial tips, visit the Simplified Burial Insurance website.
At Simplified Burial Insurance, we provide all the funeral insurance info that you may need. As if that’s not enough, our clients can get burial insurance quotes from us conveniently. Our burial insurance experts are always ready to answer any questions you may have.
Call us today or complete our quote form and we will get in touch with you as soon as possible.