Final expense insurance, or burial insurance, is great for people with health conditions that might not qualify them for term or permanent life insurance, or for people who need less than $15,000 of insurance.
The underwriting for final expense insurance is typically more lenient than life insurance. The rate for this insurance is higher than if you purchased a fully underwritten life insurance policy.
Types of Final Expense Insurance Plans
There are some companies that offer “guarantee issue” plans. This means that regardless of your health, you can get a policy. Typically these will provide for graded death benefits. A graded death benefit means that if you pass away in the first 3 years of the policy, your beneficiary will receive the premiums you paid plus 5-10% in interest. After the first 3 years, your beneficiary will receive 100% of the death benefit. If you die from an accident in the first 3 years, your beneficiary will receive 100% of the death benefit.
The benefit to this type of plan is that anyone can get a life insurance policy.
Final Expense Insurance or Burial Insurance
Some people refer to final expense plans as burial insurance. This is because the typical amount of insurance you purchase is to pay final expenses and burial.
On average, a person will take out a policy for $5,000 to $10,000. Term and permanent life insurance usually have a minimum purchase amount of $25,000 to $50,000.
Is Final Expense Insurance Right for You?
One thing to think about is how you will pay for your burial. Expenses associated with death can easily exceed $8,000. These expenses include the casket, embalming, funeral service, grave site, headstone, and more.
Having these costs covered in advance can help protect your loved ones from coming up with the funds at a difficult, and perhaps unexpected, time.
While you are considering final expense insurance you may even want to consider pre-planning your funeral. This entails working with a funeral home to pick out exactly what you want your funeral to contain. Once done, you can take out a final expense insurance policy for the amount you will need.
The Final Expense Insurance Expense Experts
We know that talking about and planning for your funeral is a very emotional thing. At Imagine Insurance Advisors, we can help you work through these concerns to ensure your loved ones not only are taken care of when your time comes, but that you have the peace of mind that you are not leaving them with the burden of having to plan while they are grieving. This allows them to cope with your loss rather than worry about financial constraints.
Think of final expense insurance as a last act of love to take care of your loved ones in a meaningful and caring way.