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How to find the best final expense insurance companies

May 19, 2023 5 Minute Read

When faced with the task of planning for our own funerals, most of us prefer not to think about it. It’s much easier to push out uncomfortable thoughts of how our loved ones will cope without us or how much money they’ll need to pay for our final send-off. Funerals are expensive – and the cost is only increasing.

The last thing you probably want is to leave your loved ones with a financial burden or run the risk that they wouldn’t have enough money to memorialize your life at all. Sadly, 37% of people indicated price as their main reason for not having a funeral or memorial service for their loved one, according to a 2022 survey by the National Funeral Director’s Association.

Many people turn to final expense life insurance to enable loved ones to give them a proper goodbye. Final expense policies are intended to cover burial costs, freeing your family from the unwelcome financial stress a funeral can bring.

What is final expense life insurance and how does it work?

Final expense insurance is a type of life insurance designed to cover the costs associated with end-of-life expenses.

When you purchase final expense life insurance, you make regular payments (premiums) in exchange for a death benefit that is paid out to your beneficiaries upon your death. The amount of the death benefit depends on the type of policy you purchase and how much coverage you decide on.

Most life insurance policies have some form of eligibility criteria that must be met for someone to be able to purchase a policy, but final expense insurance typically has more lenient requirements. Usually, as long as you’re between 50 and 85, you can qualify for final expense coverage.

When you pass away, the beneficiary listed on your policy will receive the death benefit. Your beneficiary can then use the payout to cover expenses like funeral costs, medical bills, burial fees, and other debts.

Who should consider final expense insurance?

If you’re looking for an insurance policy that can provide financial protection to your loved ones after your death, final expense insurance may be the right choice for you.

It’s a great option if you don’t have the savings to cover the cost of funeral expenses or if you have health issues that disqualify you from traditional life insurance policies.

Generally, it is easier to qualify for final expense insurance than other policies with more strict medical requirements, making it an attractive option for older adults or those with complex medical conditions.

6 Questions to ask the best final expense life insurance companies

As you research the best final expense life insurance companies, ask the following six questions.

1. What type of final expense policies do you offer?

The best final expense life insurance company is the one that offers the type of policy you need. Simplified and guaranteed issue are the two most common options available. These final expense policies are permanent life insurance options with a death benefit and cash value. However, simplified issue has limited medical requirements, whereas guaranteed issue has none.

2. Are there medical exam requirements to qualify for final expense?

Depending on the provider and policy type you select, your medical exam requirements may differ. For example, simplified issue life insurance requires you to fill out a health questionnaire. However, guaranteed issue final expense insurance has no medical requirements. The nice part about these final expense insurance options that don’t require a medical exam is that you can get coverage quickly, often in days, not weeks. The premiums may be higher than those that require a medical exam, but paying a bit more may be worth it if you have limited options.

3. How much coverage can I get?

When deciding on a policy size, it’s best practice to calculate the amount of coverage that you actually need – this can help prevent overpaying for coverage that’s not necessary. Every individual’s needs are different, and there are a variety of policies and prices to choose from, so it is important to compare options before making a final decision.

Using a final expense checklist can help you identify your needs and estimate the coverage necessary to cover those costs.

4. How are your company’s ratings?

You want to make sure you’re picking an insurer that can reliably pay out the death benefit when the time comes. That’s why researching life insurance company ratings is so important.

Ratings are essentially grades given to insurers by independent rating organizations that assess their financial stability and ability to meet long-term obligations, such as paying out death benefits. Having good ratings is a sign that an insurer will likely be able to meet its obligations, meaning it may be a good choice for you.

5. Do your final expense policies accrue cash value?

Many permanent policies, such as those for final expenses, can accrue cash value over time. Cash value life insurance can be beneficial if you want to access funds during your lifetime. However, since cash value can take years to accrue and final expense policies are smaller, most people purchase them for the financial protection of the death benefit, not the cash value component.

6. Is there a waiting period before coverage begins?

Some final expense policies may have a waiting period before coverage begins. This is typically between two and three years, although it can vary based on the company and type of policy. The policy is in force during this time, but the benefit is restricted. So, if you were to pass away within this time frame, the insurer may pay only a portion of the death benefit or offer a return of premiums instead.

Find the best final expense life insurance for you

Final expense life insurance can be a critical decision for those looking to protect their loved ones. It’s essential to take your time and consider your options to ensure you’re getting the best coverage for your needs and budget.

At eFinancial, our team can help find the best final expense policy for you. We understand the complexities of life insurance and are here to ensure you get the right coverage for a price you can afford. So don’t hesitate to contact us today and let us help you find the best final expense policy for your family’s future.