Final expense is a type of life insurance plan that covers small expenses and can be given to a beneficiary when the policyholder passes away. They are great for those who cannot qualify for other life insurance policies.
Final expense covers a variety of the small, often unexpected costs that come up often towards the end of one’s life. It is certainly not the most fun topic, but one that bears a lot of importance—don’t shy away from the security and peace-of-mind an insurance plan like final expense can bring.
One of the best and most common uses of final expense insurance is for funeral costs. Did you know that the average funeral costs between $5,000 and $10,000? There are few insurance plans quite as suited for covering this than a final expense plan.
You can also use it for a variety of costs such as estate taxes, medical bills, and more. As long as it can be covered within your set payout, you can cover it. What is the average payout for a final expense plan, then? On average, companies sell policies between $10,000 and $50,000.
One of the best things about final expense are the eligibility requirements—besides a high age-cap and occasional health-related concerns, virtually anyone can qualify for a final expense plan. It is a great option, then, for those who need easy-to-qualify for life insurance coverage.
When applying for a final expense plan, there are two different types of plans you will have to consider, simplified and guaranteed issue.
Because final expense plans do not consider your health nearly as much as other life insurance policies, you can still apply even if you cannot qualify for a different plan. Simplified issue final expense plans ask a few very basic yes-or-no questions regarding your current health in a process known as medical underwriting.
Guaranteed issue, on the other hand, skips medical underwriting entirely. As a result, you can have poor health and still be eligible for a final expense plan. Because the insurance company is assuming the risk of an unhealthy person, your costs with a guaranteed issue plan may be higher than they would be with a simplified issue plan.
The other two main categories of life insurance policies are term life and whole life. These plans, while offering a much larger payout, are significantly more difficult to qualify for. If you are concerned about your eligibility, then, final expense is by far the best option.
The other policy that comes the closest to final expense is the pre-need policy. Pre-need, unlike other insurance policies, are purchased through a funeral home, and only cover funeral expenses.
If you need a quick-fix for your funeral costs, you may want to consider pre-need. In almost every case, however, final expense takes the cake—its payout is not restricted to just funeral expenses, and you can purchase more coverage from an actual insurance company you can trust.
If you have serious health problems, you may have come to the conclusion that you could never qualify for a life insurance plan. With Schwenker Senior Insurance, you don’t have to worry—we will get you the coverage you need. To get started, call 563-579-6116, or email jon@schwenkerins.com.
