What Is Final Expense Insurance and Who Needs It?


Talking about your afterlife plans can be a grim and unpleasant conversation to have with your loved ones.

Unfortunately, this is a conversation you will need to have with them, especially when you pass away. The last thing you want is your family members to scramble around while they figure out how to pay for your funeral expenses.

Fortunately, an insurance policy called final expense insurance will put your family at ease.

If you are at that stage in your life where you need to plan for your afterlife care, final expense insurance will take care of all of that for you. As an added bonus, you may not need a medical exam to qualify!

If you want to learn more about this necessary insurance policy, you will want to keep reading below.

This brief and informative article will cover the critical information you need to know about final expense insurance and who you can reach out to for additional help.

What Is Final Expense Insurance?

Final expense insurance, also known as burial insurance, is a type of life insurance policy that covers any funeral expenses or medical bills when you pass away.

This insurance policy is popular amongst seniors because of its affordable rates and fast approvals.

Benefits of Final Expense Insurance

Final expense insurance is beneficial if your family is all grown up. As your children age, they aren’t as dependent on you as they used to be.

This means that you won’t need as much life insurance as you did when you were paying down on your mortgage or raising a family.

When you do pass away, your family may need readily available cash to pay for your funeral and burial expenses.

This final expense insurance in Omaha will ensure that your family has enough to cover those expenses. Make sure that you reach out to a reputable agent to help you calculate how much coverage you need.

Pre-existing Health Conditions

Final expense insurance companies have the ability to issue funeral insurance without needing you to complete a medical exam.

This insurance policy is easy to qualify for and very easy to understand. Your policy won’t terminate as long as you pay your premiums on time.

Affordable Coverage

As mentioned earlier, final expense insurance is an affordable type of whole life insurance. Premiums generally do not increase over time.

Although the death benefit of your policy may be smaller than traditional life insurance policies, your premiums are a lot cheaper than conventional life insurance policies.

How to Use Final Expense Insurance for Seniors

This final expense insurance is intended to provide your beneficiaries with money to cover your medical, funeral, and burial expenses.

As stated above, the death benefit for these policies is typically smaller than traditional life insurance policies.

For example, with a final expense policy, your family can expect to receive between $5,000 to $25,000.

The amount depends on what you choose when you initially sign up for your policy. You have the option to have this money paid directly to the funeral home or your listed beneficiary.

Pros of Final Expense Insurance

One of the biggest pros of a funeral expense policy is that this policy focuses on preparing for the afterlife.

Most life insurance policies don’t specifically address the costs that a family pays for a funeral.

On average, a casket can cost up to $10,000, depending on the material chosen and the style and design.

There are also other associated costs with the funeral, including the body’s transportation and the headstone.

Other funerary expenses to consider:

  • Preparation of the body
  • Flowers
  • Grave liners
  • Seating arrangements
  • Funeral home services

When you have a final expense policy in your name, your family can rest assured that your body and the funeral expenses are already taken care of.

Whole Life Policy

Final expense insurance policies are whole life policies.

This means that, like most whole life policies, the death benefit and premium stay the same for the life of the policy. Most policies also accumulate cash value.

Cons of Final Expense Insurance

One of the biggest cons of a final expense policy is the face amount, also known as the death benefit, is smaller than most other policies.

Although this insurance policy is meant to cover your funeral expenses, your listed beneficiary may use the money for different reasons.

Ensure that you trust your listed beneficiary to fulfill your afterlife wishes.

Do You Need Final Expense Insurance?

If you are currently over the age of 40 and need money to cover your funeral costs and any other associated expenses, in that case, a final expense life insurance policy is best for you.

As mentioned earlier, this policy is quite affordable. This works best for those who are on a fixed budget or fixed income.

Final Life Expense Application

Every life insurance company requires you to fill out a questionnaire. Depending on the company you choose, the application can be anywhere from 1 to 2 pages or 5 to 10 pages long.

Most applications ask about your height, weight, family history, and level of activity. Although you may not need a medical exam, there are a few companies that may request one.

If you need a medical exam, be ready to submit a urine and blood analysis. The insurer should cover the expenses associated with those exams.

When you apply for coverage, you can apply online or can call in to file your application.

The quote you receive has no obligations attached, so if you do not want to proceed with a specific company, you don’t need to!

You may be able to sign up over the phone, but most carriers prefer to meet with you in person with one of their licensed professionals.

Final Expense Insurance Pre-qualifications

When you fill out your application, there are a few questions that you will need to answer.

As mentioned earlier, you will need to fill in your personal information and answer questions about your family history and health history.

Common pre-qualifying questions:

  • Do you have congestive heart failure?
  • Do you have any heart diseases?
  • Do you have dementia?
  • Have you tested positive for AIDS or HIV?
  • Any drug or alcohol abuse?

Even if you answer “yes” to any of the listed questions here or on the application, you may still receive coverage. People with previous health conditions can still get a final expense policy.

Final Expense Insurance Cost

It isn’t easy to pinpoint the average premium amount for final expense policies because many variables are at play.

For example, your premium may be higher or lower than the average policyholder based on the information on your application.

Your age, health, and how much coverage you want to take out determines your monthly premium costs.

Applicants who wish to take out a policy for around $5,000 to $10,000 can expect to pay approximately $40 to $60 a month, depending on their situation.

Final Expense Insurance for Smokers

Tobacco rates for any type of life insurance policy are generally higher than the average applicant.

Smokers usually have rates that are 30% higher than non-smokers. Make sure that you review your policy with your insurer to have a better idea of how much your policy will be if you are a smoker.

Funeral Insurance Tips

One of the most important things you need to do is ensure that you honestly answer the questions on your application.

Any information you withhold or hide can result in the insurer canceling or denying your family the benefits from the policy when they need it most.

A few people think that they should withhold information since there are companies that do not require a medical examination.

Although you may be able to bypass the medical examination and receive coverage, when you do pass away, your benefits may be null and void.

Each insurance carrier has a contestability period. During this period, insurance companies order years worth of medical records to ensure that the information on the application matches medical records.

Plan Ahead

Ensure that you take the time to understand the average funeral costs in your area. It is best that you request a price list from funeral homes near you so you can gauge how much your loved ones will need when you pass.

If your beneficiary doesn’t already have copies of your important documents, make sure that they do. Share your final wishes with the person that you intend to be the head of your affairs.

Compile a list of your final wishes for your beneficiary as well. You will want to list what flowers you want, what songs you want played, what passages you want read, and more.

When you document these final wishes, this prevents your loved one from stressing over what you would have wanted.

Review Your Coverage Often

The cost of funerary services rises all the time, and your health could change as you age. Any type of life insurance is not a one-time type of purchase.

It is imperative that you review your coverage often to ensure that you have more than enough to protect your surviving members.

Prepay for Your Policy

Several states allow you to prepay for your funeral. Before you commit to prepaying any funeral expenses, make sure that you review how they hold your money.

Depending on your funeral, you may be able to lock in a specific rate for the services the funeral home performs at the time of your death.

Although it may seem like a good idea to prepay your funeral, make sure you review the terms and conditions before committing.

In some instances, prepaying for your funeral is not as flexible as getting final expense insurance.

This is because your prepaid plan may not cover certain funeral expenses. If you move or change your final wishes, you may lose the money paid towards the funeral home.

Listed Beneficiaries

Your beneficiary is the person who receives the profits and distributions from your final expense policy. These people are either listed in certain documents or have met specific stipulations that make them eligible.

There are three main types of beneficiaries that you will need to familiarize yourself with. Those three are contingent, primary, and tertiary.

Primary Beneficiaries

Primary beneficiaries are those who are first in line to receive the benefit payout from your policy.

These people tend to be spouses, children, or anyone else in your family that you list as a primary beneficiary.

Secondary Beneficiaries

In the event that your primary beneficiary passes at the same time you do or after you do, you may have a backup beneficiary. These people are “secondary” or “contingent” beneficiaries.

The primary beneficiary does not need to pass away for the secondary beneficiary to be able to obtain the death benefit.

If the primary beneficiary is hard to locate or they refuse the inheritance, the money will then go to the secondary listed person if there is one listed.

Tertiary Beneficiaries

A tertiary beneficiary is the third person in line. If the primary and secondary beneficiaries cannot receive the funds, then the tertiary beneficiary will receive the proceeds.

If the primary and secondary beneficiaries are still alive and willing to accept the inheritance, the third beneficiary will not receive any funds unless explicitly listed in the policy.

Apply for Final Expense Insurance Today!

Nothing is more relieving than knowing that your family is in good hands when you pass away.

Purchasing a final expense insurance policy ensures that your funeral expenses and burial costs are covered.

If you want to request more information about the process of obtaining your final expense policy, reach out to us now.

We will ensure that you receive the proper coverage you need, and we can answer any questions or concerns you have about your new policy!

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