How to Choose the Best Final Expense Insurance
2 August 2019 /
You might already know that it is important it is to have a good final expense insurance policy, but why? What is final expense insurance? What exactly are the benefits of having it? What is a prepaid funeral plan and the benefits of that?
In order to get accurate answers to some common questions about final expense insurance, we decided to go to some prominent plan providers in the United States and get feedback from them. This article is a collection of responses we received from experts in this line of work to help you gain a greater understanding on the “ins and outs” of final expense insurance and prepaid funeral plans.
Understanding the different types of funeral insurance
Funeral insurance is a broad term that encompasses several different types of plans and policies. While some of these insurance plans may be called funeral insurance, it’s more common to hear the term final expense insurance or burial insurance. Under this umbrella there are also different types of plans that are not technically insurance policies, but they are prepaid funeral plans.
What is final expense insurance?
Insurance that is designed to cover all the bills that will be faced by your loved ones after your death is known as final expense insurance. Costs that are covered in these policies include funeral expenses and medical bills. Burial insurance is another term often used to describe final expense insurance.
What are the main benefits of final expense insurance?
Because people who work in the funeral insurance industry see first hand how having insurance affects people on a daily basis, they offer a wealth of knowledge about the policies and their benefits. Dan Jessop of Senior Benefits Insurance Services provided the following benefits of having final expense insurance:
- It’s affordable for those who are on a budget.
- You have control over every detail of the funeral, from the music to the flowers to the photos that are on display.
- It provides peace of mind to your loved ones.
- Every decision you make about your funeral arrangements is one less thing for your grieving loved ones to worry about.
- Funeral homes accept assignment of the payout.
- Like everything else, the cost of funeral merchandise rises over time. Pre-paying allows you to lock in prices.
- It doesn’t have to be used for funeral expenses.
- A funeral plan is an excludable asset by Medicaid, which could help you qualify for benefits.
- Final expense insurance plans are backed by guarantees.
- Premiums do not go up and the money will be there when you need it.
Some companies, such as Symmetry Financial Group, offer customized final expense insurance plans that are tailored to the different stages in your life. Calie Brummer, a marketing copywriter with Symmetry Financial Group, was so kind as to give us their company’s perspective on the benefits of final expense insurance:
“The most valuable benefit of final expense insurance is that it protects your loved ones from debts associated with the burial or funeral process. Families who are left to pay for the funeral of a loved one are faced with bills upwards of $10,000. Expenses include:
- a headstone;
- paying for a funeral director;
- costs associated with the grave site; and
- services for preparation (casket, embalming, cremation).
“Having final expense insurance ensures that your loved ones do not face this financial burden during an already difficult time.
“Another benefit of final expense insurance is that you generally will not have to undergo an extensive underwriting to obtain coverage (think medical exams and blood tests). Qualifying for final expense insurance is based on your age and health at the time you apply, so the earlier you apply, the better.
“Final expense insurance is also reliable: your premium payment will never increase. When you connect with an insurance agent who can shop the top carriers to find the lowest rate available, this means you can lock in a low price that fits your unique needs and budget.”
What’s the Difference Between Final Expense Insurance and a Pre-paid Funeral Plan
Having a pre-paid funeral plan is not the same thing as carrying a final expense insurance policy. What exactly are the differences? Final expense insurance is a plan that will cover the cost of final expenses up to the amount that the plan has been insured for. Beyond that number, there is a chance you could end up paying out of pocket for any additional costs that add up to being more than the amount of the insurance policy. A final expense insurance policy is something that you buy and set up with an insurance broker.
A prepaid funeral plan is completely different. In this type of arrangement, a deal is worked out with a provider, typically a funeral home, to have the costs of a funeral completely covered. There are advantages to this type of plan because it allows you to lock in the price of a funeral in the current market – so regardless of what inflation does by the time you die, your family won’t be left with any surprises or unexpected expenses associated with your funeral costs.
What are the benefits of a prepaid funeral plan?
Evan Warrick, funeral director at Bright-Holland Funeral Home in Paris, Texas went to his staff members at the funeral home and asked them to identify the main benefits of having a prepaid funeral plan.. The following are the prime benefits of a pre-paid funeral plan according to the staff at Bright-Holland Funeral Home:
- The peace of mind knowing that you wishes have been recorded and are on file with the provider of your own choosing.
- Locking in prices to avoid price increases in the future.
- Knowing the expense will not be a burden on your children or other family members.
If you are in the process of exploring final expense insurance or prepaid funeral plans, you should consider these leading companies while you’re looking at options.