What Is Final Expense Insurance?
Final expense insurance is designed to cover the bills that your loved ones will face after your death – think medical bills and funeral expenses. Final expense insurance is also known as burial insurance, since even bare-bones funerals cost thousands of dollars.
Final Expense Insurance: The Basics
A final expense life insurance policy isn’t the same as what’s popularly known as “Life Insurance ”
With traditional Life Insurance, the value of your policy can be $100,000 and higher depending on how much insurance you feel you need.
With Final Expense insurance, the value of your policy is the amount of the estimated expense of your desired funeral and your last expenses.
While other forms of life insurance can be much higher, it’s rare for final expense insurance policies to get above $25,000.
Do I need final expense insurance?
That depends. If you already have permanent life insurance, your loved ones can use your existing policy to pay final expenses. If not, then you might consider a Final Expense policy so your loved ones don’t have to foot the bill from their money. One important point is that Social Security only pays $255 upon your death.
Is final expense insurance expensive?
That depends on your age, and there’s no delicate way to say this. The older you are, the higher your premiums will be. That’s because the insurance company takes on more risk when insuring older folks, given the fact that they’re statistically closer to death. If you buy final expense insurance when you’re 45, you’ll pay less each month than if you wait until you’re 75.
Whether you choose a life insurance policy that covers funeral expenses and then some or just a dedicated final expense insurance policy, you’ll be doing your loved ones a huge favor. Taking the time to consider and document your end-of-life wishes may be a little uncomfortable now, but it will make all the difference when the time comes.