While you might not enjoy thinking about it, have you ever considered how you will ease the financial burden on your loved ones after you’re gone? Final expense insurance is a generally affordable possibility you may want to consider. We understand that with many insurance options out there, understanding the different types can feel overwhelming. In this article, you’ll learn five key facts about life and final expense insurance, helping you decide if it’s the right fit for you and your family’s peace of mind.
Did you know…
The most common reason that Americans purchase life insurance is to cover final expenses.
- 60% of Americans say they purchased life insurance to cover final expenses.
- The average cost of a funeral in the state of Iowa is $8,755.
Over half of Americans believe that the affordability of a life insurance policy is the most important feature.
- 53% of Americans consider a low monthly premium the most important feature of a life insurance policy.
- Final expense policy premiums typically run between $30-$70/month. The coverage will typically amount to anywhere from $2,000-$50,000.
Less than half of Americans have purchased any form of life insurance.
- Only 47% of Americans have an active life insurance policy in place.
- So, let’s be clear – a final expense policy is a type of life insurance that is specifically used for funeral costs or final medical bills. Dealing with the loss of a family member is heartbreaking enough. This extra cushion can put you at ease knowing that your funeral and burial expenses will be covered and not become a financial burden on your loved ones at an emotionally tasking time.
Final expense insurance does not require medical tests or exams to be approved.
- Most carriers have a simplified application process that offers an immediate underwriting decision.
Like other types of life insurance, final expense policies can offer several options for additional riders to enhance your policy.
- Accidental death benefit: Provides a supplementary benefit if the policyholder passes away due to an accident within a specified period.
- Accelerated death benefit: Provides a portion (or all) of the death benefit directly to the insured when they are diagnosed with a qualifying terminal illness. The amount paid out will reduce the payout the beneficiaries receive after the insured passes away. This rider is sometimes called a terminal illness benefit.
- Children’s term insurance: Allows the policyholder to add term life insurance for their children. Coverage limits and features vary by insurance company, but most companies offer convertibility to a whole life policy once the child reaches a certain age.
As you can see, final expense insurance is one way to alleviate the financial strain on your loved ones during a challenging period. With easy application processes and customizable options, it is something to consider! If you’re interested in obtaining final expense insurance or have any questions, let’s chat.
Sources:
NerdWallet
USA Today
MarketWatch
WalletGenius
CNN
Written by: Amanda Burks