Why Consider Final Expense Insurance?
The primary purpose of final expense insurance is to alleviate the financial stress placed on family members during a challenging time. Traditional funerals can be expensive, often costing between $7,000 and $12,000 or more. Without a dedicated plan in place, families may struggle to cover these costs, potentially leading to financial strain or debt.
By securing final expense insurance, individuals can ensure that their loved ones are not burdened with these expenses. It serves as a proactive approach to financial planning, allowing policyholders to assign funds specifically for end-of-life expenses while also offering peace of mind.
Pros: Final Expense Life Insurance
No medical exam. You won’t be asked to take a medical exam, like you would with some other types of coverage. You may have to answer a few health questions, but that’s it – and even that depends on the insurer and their requirements. Applying is fast and easy without the exam.
Fast claims payment. Life insurance companies are quick to pay final expense claims – often in less than 48 hours. Your loved ones won’t have to wait long for the money they need to help pay your final bills.
The cash goes to your loved ones. You may see ads for funeral insurance, which is similar to final expense except for one key difference. With funeral insurance, the payout goes directly to a funeral home. This means your arrangements have to be made beforehand so the insurer knows where to send the money. Your loved ones don’t see a dime of it. With a life insurance policy, you choose who gets the money. You don’t have to make funeral plans ahead of time, which means you can move, change your mind, or let your loved ones make those decisions.
Your loved ones can spend that cash on anything they choose. Life insurance death benefits have no rules or restrictions on how they can be used. Your loved ones can use it to throw you a luxurious funeral, or they can choose to have a private burial and use the cash to pay off any final bills. It’s helpful to give them that flexibility so that, when the time comes, the money can go where it’s needed most. With funeral insurance, on the other hand, all the cash goes to the funeral home and is used to pay for their services. Final expense coverage puts the control - and the cash – in the hands of your loved ones.
Cons: Final Expense Life Insurance
Benefits may be limited for the first two years. Some insurers will place limitations on the first to years of your policy. If you pass away within that time period, your loved ones may only receive a percentage of the death benefit. It depends on the insurer and the policy you choose. If you want to avoid this, tell your agent while you’re shopping. Once we know what you’re looking for, we’ll only quote you policies that meet your needs.