What is Final Expense Insurance and How does it work?

what is final expense insurance

Have you been wondering- What Is Final Expense Insurance? Many people who are nearing or in their retirement years are wondering how to take care of their family after they pass, especially in regards to protecting them from financial burden created by final expenses that are incurred when a person dies. Sometimes people try saving enough money and set it aside and others may have a small benefit that is paid from their current or previous employer.

However more and more seniors are hearing that the best way to prepare for their final expenses is through a final expense whole life insurance policy. Insurance policies usually protect clients for what MIGHT happen- an illness, accident, or home disaster. Final Expense Insurance is one of the few types of insurance that protects clients relating to something that they KNOW will happen. With this knowledge comes the desire to protect family who will be left behind. So many are asking- What is Final Expense Insurance anyway?


What is Final Expense Insurance?

Final Expense Insurance is a specialized insurance policy designed to pay for a deceased person’s final expenses. This insurance is meant to take care of family members financially so they can afford to pay all expenses that remain upon the death of their loved one. By using a final expense policy, families can rest assured knowing that their final expenses will be paid and instead of guessing about the financial needs, they can budget a certain monthly premium and know that a predetermined death benefit will be paid to the family members.

what is final expense insurance

Common final expenses that family members choose to pay from this insurance are funeral expenses, memorial service costs, filing paperwork and legal fees, debts owed, and sometimes extra money can even be set aside for a gift to a loved one. One of the most important considerations when answering what is final expense insurance is to keep in mind that final expense insurance provides peace of mind and is affordable for seniors who haven’t set up protection for their family.

How does Final Expense Insurance Work?

As you ask yourself, What Is Final Expense Insurance, that leads to asking How does Final Expense Life Insurance Work? Final Expense Life Insurance is a specialty type of whole life insurance. This type of life insurance is intended to be set up for the purchaser’s whole life. Because the intent is to pay final expenses upon the client’s death, it only makes sense that the policy is structured to meet those needs whether someone has 5 years or 25 years left before their passing.

Once a burial insurance policy is issued, there are a couple unique qualities that stand out from other types of insurance. The first we already mentioned, it lasts for your whole life and can never be cancelled as long as monthly premiums are being paid. The second feature is extremely unique in the insurance market- the monthly premiums can NEVER be raised! In an industry where rates are always being raised for one reason or another, a type of insurance that has a guaranteed fixed price for life is extremely helpful to the senior population, especially those on a budget.

Final Expense Insurance is the same as Burial Insurance and Funeral Insurance – Different marketing names but the same Whole Life Insurance Policies

Who sells Final Expense Insurance?

Naturally, after pondering what is final expense insurance and how it works, the next obvious question is how to get final expense life insurance. Here is where not all answers to this question are created equal. There are a few options for purchasing funeral insurance. One way is from an agent, another directly from an insurance company, and the third option is purchasing from an insurance broker. The first two options of an agent or buying direct have the same drawback- limitations to the companies available meaning limited options for fitting your exact insurance needs.

what is final expense insurance

An agent and going direct mean you must choose from only the plans available from one insurance company. Often companies have a particular niche and the way to get the most coverage at the lowest rate is to find the company with the niche that fits your needs. This is where an insurance broker is the best option because they have access to numerous life insurance companies fitting many clients’ needs.

Here is an example of how an insurance broker can help: (based on 69 year old non-smoking male)

Company A is Mutual of Omaha

Mutual of Omaha Life Insurance specifically asks about TIA (Transient Ischemic Attack) on their application and if you answer yes to their TIA question, you would qualify for their Graded policy (2-year waiting period) and $10,000 of coverage would cost you $114.19 per month.

Company B is Royal Neighbors of America

Royal Neighbors of America doesn’t ask about TIA on their application so they don’t view your condition as serious as Company A. You would qualify for their Level Benefit (Immediate coverage) and a $10,000 policy would cost you $71.61 per month.

Clearly, Company B is your best option but many clients don’t get a chance to compare options and end up paying too much. By using an insurance broker like Assurance Life, in this example if you lived to age 90… you would end up saving $10,730.16 over the years choosing Company B.

Plus, not only saving a ton of money, you would also get a policy that doesn’t have a 2-year waiting period. This is huge!

So you can see by having options that an insurance broker can provide, you aren’t just finding out What is Final Expense Insurance- you are also discovering how to get the best life insurance that fits your individual needs.

Why Assurance Life?

Assurance Life is an insurance broker who works with numerous reputable insurance companies- all of which are A Rated. It is important to have an A Rated company because it means your policy insurer will be around to pay the death benefit to your family members when they need it the most. The companies that Assurance Life works with have been serving Americans for upwards of 50-100 years.

Along with outstanding insurance partners, Assurance Life specializes in knowing which whole life insurance company can get you the most coverage at the lowest price. Using the example above, Assurance Life would take one look at the age and health profile, and know exactly where to go with that customer’s application. That kind of expertise can save time, trouble, and money by finding the best choice first.

what is final expense insurance

Assurance Life can walk you through the process of answering your questions including any remaining questions about what is final expense insurance, assisting you with a brief application, and usually getting instant approval for about 90% of clients. Any others are usually approved within an hour. We work with enough companies that even with serious health conditions, we have companies that specialize in guaranteed issue whole life insurance where you are approved regardless of your health history. Our customer service is also personalized because we take seriously the responsibility and privilege of helping you protect your family.

Hopefully your question of What is Final Expense Insurance has been answered and then some! Let Assurance Life get the process started so you can rest assured that your final expenses will be taken care of.