Final Expense Life Insurance

Final Expense life insurance is a form of whole life insurance that is designated to pay medical bills, funeral and burial expenses, and unpaid nursing home expenses when you die.

Also known as funeral insurance or burial insurance, final expense insurance is targeted at the senior marketplace to help seniors get affordable peace of mind knowing that final expenses will not be left to surviving loved ones when the worst thing happens.

There are many insurance companies competing in the final expense market and most of them offer traditional final expense policies that have these common features:

• Whole life insurance that never cancels except for non-payment of premium
• Once the policy issued the premium cannot be increased by the insurer for any reason
• The policy builds cash value over time that earns tax-deferred interest and can be accessed by the policyholder via loans or withdrawals for any reason
• No medical exam or blood and urine tests
• Fast and easy application process with fast approvals in days

Types of Final Expense Insurance

Although most final expense insurance companies have liberal underwriting guidelines, many carriers take the additional steps of offering multiple insurance plans to accommodate those seniors who might not qualify for a level benefit plan.

There are three types of final expense plans available in the market today:

Level Benefit Plan

When an applicant qualifies for a level benefit final expense insurance plan, they will receive the lowest rates and required waiting period before the full death benefit is available.

To qualify for a level benefit plan, applicants must be in generally good health and not answer yes to any of the “knockout” questions on the application.

Most companies offer the level benefit plan to applicants who are age 50 to 85 with face amounts from $5,000 to $30,000. Since the average cost of a traditional funeral and burial service is typically between $8,000 and $12,000, many seniors will apply for a $15,000 plan to accommodate additional unexpected expenses.

Here are actual rates for a $15,000 level benefit final expense policy for a healthy male and female non-smoker:

All rates are subject to underwriting by the carrier. For an accurate rate for your actual age, check out our instant rater on the right side of the page.

Graded Benefit Plan

The graded benefit final expense plan is designed for applicants who cannot qualify for a level plan because of severe or multiple health conditions.

Since the insurance company is willing to issue a life insurance policy for an applicant who is considered high-risk, the insurance company will generally charge higher rates and require a graded death benefit to be paid if the insured dies from natural causes within the first two years of coverage.

The graded benefit amount can vary depending on the insurer you select but most carriers will pay 30% of the full death benefit during the first year and then 70% of the benefit during the second year. If death occurs in the third year or later, the company will pay 100% of the death benefit in the policy.

This graded benefit will only apply if the insured dies in the first two years from natural causes. If death is the result of an accident, the insurer will pay 100% from the first day of coverage.

All rates are subject to underwriting by the carrier. For an accurate rate for your actual age, check out our instant rater on the right side of the page.

Guaranteed Issue Plan

The guaranteed issue final expense plan is considered by most as the life insurance policy of last resort. Virtually anyone who is an eligible age and not in a hospice facility will qualify for coverage since there is no medical underwriting by the insurer.

In exchange for issuing a life insurance policy to an unknown health risk, the insurance company will require a two or three-year waiting period when they will pay 110% of all premiums paid to the beneficiary listed on the policy if death results from natural causes.

Moreover, the premiums will be much higher than the level benefit or graded benefit plans.

Many seniors purchase this type of product unknowingly when they buy life insurance from TV companies like Colonial Penn or Globe Life who do not warn the applicant about the waiting period.

The terms “guaranteed issue” and “guaranteed acceptance” mean the same thing. Most seniors who purchase a guaranteed issue plan choose a lower death benefit since the rates are pretty steep for most budgets.

Here are the actual rates for a $10,000 guaranteed issue final expense plan for a male and female applicant:

All rates are subject to underwriting by the carrier. For an accurate rate for your actual age, check out our instant rater on the right side of the page.

How to Find the Best Final Expense Plans at the Lowest Rates

With 21st century technology, it’s quick and easy to find the best final expense and burial insurance plans with the lowest rates because we can quote your policy needs with multiple insurance companies simultaneously.

Like other independent agents, Senior Benefits Consulting represents multiple insurance companies but we are not employed by any of them.

For this reason, our loyalty will always be with clients and prospective clients rather than a company that pays a salary. Our advice, advocacy, and experience are available to all seniors free of charge because we earn a commission from the insurer you select to do business with.