Having an insurance policy has become vital recently because it allows you to secure your future and that of your loved ones. Final expense insurance policy is among the most common policies today that you can take especially if you are a senior. Here, you will learn about what this policy entails and some of the best benefits of having it. Read on.
What is the final expense insurance policy?
This policy is a kind of whole life insurance that covers medical bills and funeral expenses when someone dies. It’s also called funeral or burial insurance and is more popular with seniors. Here are the most common features of this policy you should be aware of:
- It has a straightforward application process
- You get fast approval
- It is affordable
- It involves fixed premiums provided you pay on time
- It’s a whole life insurance policy meaning it doesn’t expire if you pay all your premiums
- You can even get a policy loan with it
- It does not involve any medical exam
Types of Final Expense Insurance Policy:
- Simplified Issues Life Insurance
This type of insurance does not involve medical exams, but you must answer some specific health-related questions. The questions might vary. For instance, if you say you are HIV positive, then you might not get the whole life insurance policy.
- A Policy with Some Graded Benefits
This one is usually a good option if you don’t qualify for the simplified policy. It pays quite low within three years of purchasing it but increases the amount to the agreed percentage after several years.
- Guaranteed Policies
As the name suggests, it is probably the best because you won’t be asked any questions and you’re also guaranteed you’ll be approved.
5 benefits of final expenses insurance policies:
1. It Makes Things Easier for Your Loved Ones
After you pass, your family will be responsible for taking care of everything, including your medical bills and burial expenses, especially if you did not have any life insurance cover. Doing this might not always be a huge issue because friends and family take it as an opportunity to express their love to you. However, handling all those expenses might leave some if not all of them in huge financial fixes hence making their lives harder after your burial which is why you should have a final expense insurance cover.
Having this kind of insurance helps to reduce the expenses as it covers most of the costs hence making the entire process easier. You can purchase this policy without bothering your loved ones because there are many sites online showing the different packages they offer.
2. Enables You to Think About Exactly What You Want
This insurance policy makes you evaluate everything you’d want for your funeral. Before taking this policy, you should research about the funeral costs around your location. You can check these prices online, or you can even visit some funeral homes near you and write down their costs. Doing this allows you to get an idea of the type of policy to take that will cover everything perfectly and one you can afford comfortably.
With this policy, you can also start planning on other vital things such as the flowers you’d want, the Bible passages you want the preacher to read, the songs to be played, and so much more. Documenting all these details early enough makes things easier for your family because they won’t get headaches trying to figure out what you would have wanted.
3. Can Help to Pay Loans
If you were to die today, that does not mean all your loans will disappear. For example, if you and your wife have a mortgage loan or any other type of loan, she will be left responsible for clearing the entire loan herself. If she fails to pay it within the agreed time, then your house might be taken away from your family, leaving them in a terrible situation.
The benefits of final expenses insurance policies are that your family will get the remaining amount after all the burial expenses have been met. This cash can help to pay such a mortgage easily.
You can also use a final expense insurance policy as a great way to save money for your kids’ education. How? If your children take an education loan, then they can use the remaining money from your insurance to help settle it.
4. It’s Great for Business Planning and Taxes
If you have a business, then you need to get a final expense insurance policy, especially if you have a business partner. Why? Let’s say that you or your partner passes away, one of you will be left with all the responsibilities to run the business and settle all the bills. If you have an insurance policy, then it can help to reduce the financial baggage left behind hence making it easier to continue running the business with a beneficiary or a family member of the deceased.
If you and your business partner had taken a loan, you wouldn’t be left with much stress paying it back because some of the funds from the policy can help to settle a certain percentage of the loan so that the family gets the remaining cash to help with the burial.
Your family might also be left with some inheritance estate taxes on every asset they receive after you die. Therefore, a final expense insurance policy can help to cover such taxes to help ensure the inheritances do not go accompanied by other responsibilities. Additionally, easing the estate taxes ensures no family member will feel the need to sell the received asset because they can’t keep it with the taxes.
5. It Is Affordable and Provides Quick Funds
If you ask most people around the globe today why they don’t have insurance, they will always say it’s because they don’t have enough money or it’s very expensive because of the monthly payments.
The best thing about a final expense insurance policy is that it is cheaper compared to other types of policies. Most people can pay it comfortably, plus you pay cheaper monthly premiums if you are healthy enough hence reducing the overall costs. You might even get some policies charging about $1 daily or even less compared to the insurance company and if you have a pre-existing medical condition.
Planning your funeral in advance is always a better idea compared to letting your family and friends accumulate the funds to settle everything. In times of grief, nobody usually has the strength to figure out how to capitalize on the little existing money to fit every expense.
So, having an insurance cover allows you to pay the funeral home and other custom services needed for the burial without even telling the family about it. You just need to inform one beneficiary who will be aware of the policy so the family can access it immediately and avoid stressing out.
Also, the insurance company always provided the money immediately after you passed. Therefore, your friends and relatives will get the money, allowing them to start making the necessary arrangements without much hassle.
Insurance is vital, and having a final expense insurance policy has several excellent benefits. Therefore, make sure to look for a reputable company that will offer you a great policy that fulfills its specific purpose after you pass on.