is a simplified form of whole life insurance that is used predominantly for funeral and/or cremation expenses. The average cost of funeral services in the United States increases every year. The average cost can be anywhere between $7,500 to $12,000.
3 Different Types of Final Expense:
- Level Coverage (Best Option): The full death amount of the policy is available from day one of the coverage starting. The cost of these plans are also lower than the other 2 types of coverage.
- Graded/Modified Coverage (Mid): The Graded or Modified plans are available to individuals with mild health conditions and vary by carrier. The death benefit is typically a percentage of the entire death benefit during the first 2 years of the plan. It is common to see something like: 30/70/100. This means 30% in year 1, 70% in year 2, and then 100% year 3 and beyond
- Guaranteed Issue (Low): Guaranteed issue plans come with 2 year waiting periods before the full death benefit is available. However, many carriers will offer a 110% return of premium if the insured dies within the first 2 years of the policy so it does not end up being a complete waste of money.
Final Expense Pros:
- Everybody ages 50-85 qualifies for a plan
- No Medical Exams
- Same Day Approval
Final Expense Cons:
- Death Benefit Limits
- Waiting Periods for those who do not qualify for level coverage.