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Final Expense

What is Final Expense Insurance?

Final expense insurance (also known “burial insurance”) is a form of a whole life insurance policy with a small death benefit. Final Expense policies are easier for seniors to get approval. Often it requires answering only a couple of health-related questions, but a medical exam is not necessary.

Death benefits usually range from $5,000 to $25,000, with the premiums being paid either weekly or monthly. Most often the benefit is designed to cover funeral-related expenses such as the funeral, cremation, embalming, memorial service, and a casket. However, most final expense insurance policies allow the death benefit to be used for any purpose,.

Advantages of Final Expense Insurance

  • Policies are widely available, even to applicants with health issues
  • No medical exam is called for
  • Policy premiums are fixed
  • Death benefit is guaranteed, although some plans require a 2yr to 3yr waiting period for full benefit payout.
  • The policy is guaranteed to never expire as long as the premiums are being paid
  • Death benefit can be used for any purpose and is not taxable
Disadvantages of Final Expense Insurance
  • Relatively low death benefits, which may not turn out to be beneficial if the insured person is younger
  • One missed premium payment may terminate the policy (also true for other insurance types)
  • With a final expense policy you will likely pay premiums for the rest of your lifetime.