Getting life insurance becomes harder as we grow older, but it becomes even more critical at the same time.
Even if your family is grown, you don’t want to leave them with any financial burdens after you pass away. With the median cost of a funeral rising to $7,848 in 2021, it’s more important than ever to have a safety net for your loved ones.
Unfortunately, for many seniors, standard life insurance can be too expensive or difficult to obtain. That’s why final expense insurance is such a powerful alternative — it provides necessary coverage for individuals who don’t qualify for traditional insurance.
If you’re older or dealing with medical issues that limit your options, this article will cover seven essential reasons to get final expense insurance.
1. Better Approval Odds
Final expense insurance, often called funeral or burial insurance, is a whole life insurance plan that many insurance providers offer to cover, you guessed it, final expenses. It’s not meant to replace income and provide long-term support. As such, the death benefits are relatively low, ranging anywhere from $5,000 – $50,000, though some providers offer up to $100,000 and beyond.
The lower coverage amount helps your approval odds. Insurance companies take on less risk by offering less money. They’ll be more willing to work with you even if you wouldn’t qualify for high-value insurance plans.
Final expense policies are an excellent option for older individuals transitioning from a term life plan. While you may not qualify for the same rates, your family will be grown by the time a 20 or 30-year term ends. At that stage, you likely won’t need as much coverage to support them.
2. Affordable Coverage
Dollar-for-dollar, the relative cost of final expense insurance is more expensive than traditional life insurance. But if you don’t need the high death benefit of a traditional life policy, a final expense plan may offer the perfect blend of monthly price and coverage amounts.
Depending on your total policy amount and personal situation, a final expense insurance plan may cost as low as $10-20 per month. Many insurers make payments even simpler by offering different payout schedules. They may offer a monthly price or let you pay for an entire year all at once.
3. No Medical Options
One of the most attractive features of many final expense plans is that there is no medical exam needed to get coverage. All you need to do is fill out an application and basic health questionnaire.
Insurers will ask questions about your current health and any pre-existing conditions. They will also go through the typical steps of checking your medical history to set their rates.
A medical exam can bring previously unknown health issues to light. Your rates will likely rise as a result. By avoiding a medical exam, you have the potential to lock into the best possible premiums, which won’t increase for the life of the policy.
If you’re worried that a medical exam may disqualify you from getting coverage or the best rates, a final expense plan makes a great first option.
4. Pay for Your Funeral
Of all the financial burdens we leave behind, funeral costs are one of the most significant and most common. With the ever-rising costs of burials and services, more and more families need help paying for funerals after the unexpected loss of their loved ones. The primary purpose of final expense insurance is to absorb those costs, giving your family a much-needed lifeline and providing timely relief.
5. Pay Off Debts
Final expense insurance is designed for older individuals or those in poor health. Outside of the coverage amount and medical requirements, there is little difference between final expense insurance and a traditional policy.
That’s great news for people who want a flexible death benefit. Unlike preneed insurance, which goes to the funeral home to pay for your eventual funeral expenses, final expense insurance death benefits can be used for anything.
When you die, you may still have existing loans, medical bills, or other unresolved debt. Those outstanding financial responsibilities transfer to your next of kin.
With a final expense insurance plan, you give your family the option to use leftover funds to pay off debt. There are no rules on who can be beneficiaries or how they can use the benefits. Your family will have the flexibility to use as much of the benefit as they want for paying off debt, paying for the funeral, or even personal use.
6. Take Care of Funeral Plans
As you get older, you’ll need to make preparations for your death so that the transition for your family is as seamless as possible. It’s why we get insurance and lay out our wishes in wills. It answers important questions before they’re even asked and helps avoid many of the more frustrating situations that could arise, such as probate.
A final expense insurance plan will give you a foundation to arrange your funeral. Although there’s flexibility in how your beneficiaries use it, you can discuss your desires for the amount they’re guaranteed to receive.
The emotional weight of your passing will be difficult enough. By having financial assurance and a plan in place, you make it easier for your family to navigate the fallout of your death.
7. Peace of Mind Today
When you get final expense insurance, you do yourself and your family a favor by providing immediate relief.
If you don’t have life insurance, the concern among those around you will only become greater the older you get. Signing up for final expense life insurance will allow you to avoid uncomfortable conversations and the worry that you may leave your family in a bind. You and your loved ones get the benefit of that peace of mind for the rest of your life.
Is Final Expense Insurance Right for You?
If you take care of life insurance sooner rather than later, you’ll enjoy the best possible rates and the confidence that your family is protected. Don’t let your age or medical history keep you from applying. By looking into final expense coverage, you’ll be able to find a plan that fits your needs and budget, no matter your situation.
Are you ready to realize the benefits of a final expense insurance policy? Contact our agents at Freedom Insurance Financial today to discuss your life insurance goals and find the best final expense insurance plan available.