Regardless whether its old age or a terminal illness that brings someone to the thought of all the possible funeral expenses. Proper planning can be a key to making sure things go smoothly and your family is not left with a financial burden. The common pitfalls with funeral planning tend to be associated with not getting adequate protection and being confused about various life insurance options. If you have figured all that out already feel free to give us a call or start a chat to initiate your life insurance shopping. Otherwise, stay tuned as we cover all the aspect of life insurance and how they can help cover funeral expenses. The following are some key points from this article;
- The first thing you need to know in order to buy life insurance coverage for funeral expenses is to know what types of life insurance you could buy!
- Most common life insurance policy that people are sold are known as final expense life insurance. This is usually a whole life policy with no exam requirement which can be acquired by answering a few questions or none if it’s a guaranteed issue.
- A pro of this policy is that you don’t have to go through the arduous process of a medical exam or having to deal with sending over your medical records. Another upside to this policy is that you literally get what you want to buy and that is a policy that covers your funeral expenses.
- Now let’s get down and dirty with the cons of guaranteed universal life insurance. The first con of this product is that you can’t have any cash value, unlike other permanent life insurance products.
Types of Life Insurance
The first thing you need to know in order to buy life insurance coverage for funeral expenses is to know what types of life insurance you could buy! The first type of life insurance you could buy that covers your funeral expenses is called a final expense policy. When it comes to funeral expenses there is no better and faster solution than a life insurance policy. Now there are a few different types of life insurance policies available and it is important to pick the right one. Most common life insurance policy that people are sold are known as final expense life insurance. This is usually a whole life policy with no exam requirement which can be acquired by answering a few questions or none if it’s a guaranteed issue. It’s very popular since you can get a policy from 5k to 20k regardless of your health. However, if you are in good health you can get a much better rate and more coverage by applying for a traditional permanent life insurance policy such as a no-lapse universal life. In some cases, people buy term due to its affordability but it’s not recommended because you are more than likely to outlive the coverage. To make things simple just remember a final expense policy if you are sick and a no-lapse universal life if you are healthy.
Another type of life insurance that you can consider for funeral expenses is a guaranteed universal life insurance policy. Guaranteed universal life insurance is also called lifetime term or no lapse universal life. This type of insurance is affordable and that’s why many people gravitate to this policy. This policy works just like a traditional term life insurance policy and doesn’t create cash value but it’s permanent and you don’t have to worry about your policy expiring. Unlike traditional universal life insurance, guaranteed universal life insurance does no increase in cost and does not require additional money to build an investment.
Pros and Cons of a Final Expense policy
For the most part, final expense coverage is a lot like guaranteed issue life insurance. It does have smaller face amounts and you do have to answer a few questions to be qualified. A pro of this policy is that you don’t have to go through the arduous process of a medical exam or having to deal with sending over your medical records. Another upside to this policy is that you literally get what you want to buy and that is a policy that covers your funeral expenses. This policy ONLY covers that. Since it covers that a con of this policy is that you will not be able to gain cash value. Another con is that you can only get a policy of $50,000 face amount or less depending on the life insurance company.
What will my costs look like?
Once you figured out the type of life insurance policy that works best for you, it’s important to make sure you get enough to pay off all the bills. The first thing to calculate is the actual cost of a funeral, which according to the national funeral directors association has a median cost of about $7045. Now if you want additional services whether it’s a large ceremony, custom casket or plot, be sure to calculate that as well. Although you are buying a life insurance policy to cover your funeral expenses be sure to have additional coverage for nursing home expenses, medical bills, legal fees and any outstanding bills that you may have. If you have some cash that you were planning to utilize for your final expenses you can deduct that from the total coverage amount needed.
How to get the best life insurance policy
- The first thing you need to do is do all your research and find out which type of life insurance you want to buy and one that covers exactly what you want it to cover.
- The second thing you should do is contact an independent life insurance agency who can steer you in the right direction and help you find the best life insurance company for you to buy coverage from. If you are a senior it is crucial for you to work with us or another dependable independent brokerage because there won’t be many companies that will offer you these types of insurance and we are here to help you. If you have medical conditions then you definitely need to work with an independent agent because in case you didn’t know, every life insurance company have their own niche or specialty. Let’s say you have diabetes, you can’t just apply with any life insurance company. I mean you can but you will have to pay high premiums and get a worse health rating than you anticipated. You should be working with a company that specializes in diabetes because a company whose niche is diabetes will understand their diabetic clients more than a company who specializes in sleep apnea. As an independent life insurance brokerage, we understand all the life insurance companies and their niches to help steer our clients in the right direction.
- Once you work with an independent agency you will find things to be easier. You will not have to read a million reviews of life insurance companies because you will be taken care of. If you decide to go SOLO check out our list of the best life insurance companies for seniors. But if you decide to go SOLO you need to make sure you are doing all your homework to make sure you are getting the best deal possible.
- Shop around for quotes like crazy! This is another great way to make sure you are getting the best possible deal out there. If you have 30 seconds go below this article and fill out our quick quote engine to see for yourself what your premiums may look like. Not only will you be able to see different quotes but you will be able to compare them with other top-rated companies. Keep in mind cost life insurance over 60 tends to be more expensive.
Work with us!
Now that you know what type of coverage you need and have accurately calculated the right amount of coverage, it’s time to shop! There are thousands of life insurance companies out there offered through your local agent, banks, insurance brokers, and now even Walmart. So which is the best intermediary to go through? Well, it will be an independent agency that allows you to shop with all the companies at once, so you can get the best deal since life insurance rates are fixed by the law. Be sure to work with a broker that understands your situation and can provide a plan that addresses your concerns. Also be sure that the company you apply with has strong financial stability and is highly rated by rating agencies such as A.M. Best or Moody’s. Lucky for you, we are that broker that can provide all the services above. For life insurance comparison you can use our permanent life insurance quoter to get a good idea of how much a life insurance policy will cost or just call us at 1.888.492.1967.
