No one wishes to be a liability for their loved ones. With the rising cost of burial and funeral expenses, it makes sense to have some form of provision to take care of this even before death. As a result, many people opt for final expense insurance to take care of every cost related to their death and burial. While such insurance does not provide money for the deceased’s family, it also removes the burden of covering their funeral and burial expenses.
Many companies offer final funeral expenses. As a result, one might be confused about how to go about it. This article will guide you on specific things to consider and bear in mind before getting final expense insurance.
1. Final Expense comes in Three Types.
Simplified Issue Life Insurance
While there is no medical examination in this type of final insurance, the applicants need to answer some health-related questions. There might be a disqualification if the applicant supplied any affirmative answer to the question. For instance, there could be a question about any incidence of cancer. The presence of this might lead to disqualification.
Policy and Graded Benefits
For people that do not qualify for the simplified type because of various health issues, this is the right choice. There will be a particular amount of the full death benefits within three years after starting the policy. You will get what is left after the completion of the terms.
Guaranteed Issue Life insurance
This policy does not come with the burden of answering any question. With this, the probability of disqualification is significantly low. However, one needs to expect pros and cons, as with other policies. For instance, if the policyholder dies within a year of buying the insurance, the company will only take care of little funeral and burial expenses. Also, deaths caused by accidents have different conditions as well.
2. Quality of Coverage Differs
In buying final expense insurance, the cheapest policy may not be the best fit for your family and medical needs. The needs of everyone vary, which makes it essential to consider the policies well. Here are some items to consider:
Casket: For a person that wants a burial, they need to account for this. Cost varies and ranges between $5000 and $10000.
Cremation: A person that wants cremation might not need much coverage. On average, the cost of cremation is around $2,000 or less, which helps save money.
Funeral Services: This also involves the type of funeral service: will it be formal or informal? Will the funeral involves a director? What kind of facility will the funeral event take place in?
Outstanding debts: In other words, consider things like mortgage because you can use final expense insurance to cover it.
3. Qualification is easy, but not everyone Qualifies.
Many times when applying for final expense insurance, you will not be subjected to a medical exam. However, some categories of people might not qualify, even with how easy it is to get through. The following are categories of people that will not be eligible:
- People in a nursing home
- People above 90 years
- Someone hospitalized or in hospice care.
- There are times a company might disqualify someone above 80 or 82, so be sure to check out the company’s policy.
- People in a dangerous job line, with risky hobbies or a severe medical ailment, might not qualify.
- People living in a retirement home or assisted living
However, you might get a good plan based on your health, age, and plan for the final expense. Make sure to understand the terms of the contract. The contract might have some clause that excludes them from paying the death benefits if the policyholder dies in the first two years.
4. Approval Duration is Quick
This insurance does not require a strict medical examination before acceptance, which makes approval relatively easy. The application can be made over the internet or via a mobile phone. You will often get free quotes from these companies, which will give you all the essential information about their policy.
5. Final Expense insurance is not for Youths.
There is no specific age requirement one needs to buy the final expense insurance. However, this insurance is suited for senior citizens. If you are below 60 years and have no disability or any severe health issue, you are better off going with a life insurance policy. It is cost-effective compared to final expense insurance.
This might be a good idea for middle-aged adults, as burial expenses will likely rise over time due to inflation. Final expense insurance is quite expensive, which makes sense when you consider funeral costs.
Getting final expense insurance is the right call for people that want to ensure that their death does not come with a series of burdens to their loved ones. It comes with many benefits like reducing the financial burden of their departure on their loved ones and helping you have the type of burial you preferred. With many companies offering final expense insurance, this article can guide you on what to consider before subscribing to anyone.