Why Final Expense Insurance


Benefit Levels

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Most policy amounts are under $50,000, but the average policy is taken out for $10,000 – $20,000. The exact benefit amount will vary depending on your health and what you’re looking to protect. If you qualify for a modified plan, your coverage amount may be less than a traditional final expense policy.

Modified plans are issued to applicants with higher health risks and usually have a 2-3 year waiting period. They are typically issued to applicants with one or more health conditions or if the applicant is taking certain prescriptions. If the insured passes during this period, the beneficiary will usually receive all of the premiums paid into the policy plus a small additional percentage.

Another final expense option offered by some life insurance companies are 10-year or 20-year plans that give applicants the option of paying their policy in full within a certain time frame. These plans have higher premiums and are usually considered standard final expense plans.


End-Of-Life Insurance Tips

Be honest

The most important thing you can do is answer questions honestly when getting end-of-life insurance. Anything you withhold or hide can cause your benefit to be denied when your family needs it most.

Some people think that because most final expense policies don’t require a medical exam they can lie about their health and the insurance company will never know. But companies often order years’ worth of medical records when their insured dies during the policy’s contestability period. If there are any discrepancies between the answers on the application and the medical records, the claim is often denied.


Plan ahead

Take the time to understand funeral costs in your area. You can request a general price list from any funeral home in your neighborhood to get an idea of how much your final arrangements could cost your loved ones.

If they don’t already, make sure the person who will be in charge of your affairs has copies of all important documents. Share your final wishes with them too (what flowers you might want, what passages you want read, songs you want played, etc.). Documenting these ahead of time will save your loved ones a lot of stress and will prevent them from trying to guess what you wanted.


Review your coverage often

Funeral costs are rising all the time and your health could change suddenly as you get older. Life insurance is not a one-time purchase. It’s important to review your coverage often to ensure you have enough to protect surviving family members.



There are three main types of life insurance beneficiaries: primary, contingent (or secondary), and tertiary. The primary beneficiary gets 100% of the death benefit when the insured dies. If the primary beneficiary passes before the insured, the contingent receives the benefit. Tertiary beneficiaries are often a last resort and are only used when the primary and contingent beneficiaries pass before the insured.

Your death benefit can be split among multiple primary and contingent beneficiaries. Make sure you designate the percentages each should receive and verify the information once your policy is issued. You should also notify your beneficiaries of any percentages you’ve put in place to ensure there is no confusion when the time comes.

Whenever possible, choose an adult as your primary beneficiary as this will simplify the distribution of the death benefit. Provide as much relevant information as you can about your beneficiaries (their address, phone number, date of birth, etc.) so the insurance company can locate them quickly when a claim is submitted.

It’s important to periodically review your beneficiary information to make sure it’s up-to-date. Always notify your life insurance company of any change of address or phone number so they can update their records.



Many states allow you to pre-pay for your funeral. Before you pre-pay, check to see how the money will be held. Depending on the funeral, you may be able to lock in a certain rate for the services the funeral home will perform when the time comes.

As with any final arrangement, keep detailed documentation for yourself and for the person who will be in charge of your affairs.

Pre-paid funeral plans may seem like a smart choice, but make sure you understand exactly how they work. In most cases, pre-paying for your funeral is less flexible than getting final expense insurance because your prepaid plan can only be used to cover funeral expenses. If you move or change your final wishes (example: you decide you want to be cremated and have your ashes scattered), you and your family may lose the money you’ve paid to the funeral home.



What does final expense insurance cover?

Your beneficiary can use the death benefit for anything, but it’s typically used to cover funeral or cremation expenses.

What is the difference between final expense and life insurance?

Final expense is a type of whole life insurance and usually has a smaller face amount than traditional insurance. It focuses on covering end-of-life expenses while most life insurance policies focus on income replacement.

How does final expense insurance work?

It works like most other types of life insurance: there’s an application process and a review/approval process by the insurer. The death benefit is paid to the primary beneficiary once the claim is approved.

What is the maximum age to get final expense insurance?

It depends on the insurance company. Most people can get coverage until they turn 85. There are some companies that insure someone over the age of 85, but be prepared to pay a very high premium.

What happens to the excess proceeds of final expense insurance?

Final expense insurance doesn’t guarantee a certain amount of money towards funeral costs – 100% of the death benefit goes to the primary beneficiary. If you do any kind of funeral planning in advance, you can document your final wishes for your primary beneficiary and show how much of the policy benefit you want to go towards final arrangements.

How do you buy funeral insurance or final expense insurance for children?

The process is typically the same at every age. Most insurance companies require an individual be at least 30 days of age to apply for life insurance.

How quickly are final expense insurance policies paid out?

This depends solely on the life insurance company. Some companies can take weeks or months to pay the policy benefit. Others, like Lincoln Heritage, pay approved claims in 24 hours.

What are the average premiums for final expense insurance plans?

It’s difficult to say what the average premium will be. Your insurance rate depends on your health, age, sex, and how much coverage you’re taking out. A good estimate is anywhere from $40-$60 a month for a $5,000 – $10,000 policy.

How much is final expense insurance for a smoker?

Rates for smokers are usually 30% higher than a non-tobacco rate. Tobacco rates are higher no matter what type of life insurance you take out. The older you are, the higher your tobacco rate will be.

Final expense insurance lifts a financial burden from families grieving the loss of someone they love. If you want to provide those you care about a safety net during their time of grief, this policy type is a great option.


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