Unfortunately, death is something that affects us all at some point or another. The upside of this is that it is often possible to plan for this event, and put provisions in place for after we are gone.
Statistics from the National Funeral Directors Association show that the average cost of a funeral in 2019 was over $7,500. This is a huge expense, and it is a cruel irony that it is often those in a distraught state, grieving the loss of a loved one, that are left to deal with this payment.
Final expense insurance aims to prevent this from being the case. Read on to find out what exactly final expense insurance is, and how it can benefit you and your loved ones after you are gone.
What Is Final Expense Insurance?
Final expense insurance is a form of life insurance that allows you to pay for any expenses that may have accrued immediately following one’s death. This includes things like medical bills, funeral expenses, burial costs, and any other payments that are commonly made after a person dies.
How Does it Differ From Whole Life Insurance?
Final expanse insurance is, in essence, the same as whole life insurance. It is taken out in the same way, paid out in the same way, and follows the same rules and regulations. The only real difference is the size of the payment received at the end.
Because the payment is generally of a smaller nature than one would receive with a standard life insurance policy, it is given a different name. If you’d like to know more about different insurance and medical terms you can find more information here.
What Are the Advantages?
One obvious drawback of a final expense insurance policy is that the recipient won’t have as large of a payout as they would with a standard life insurance policy. So, why then do people opt for this type of insurance?
The reason is that this type of policy is more accessible than a traditional life insurance policy. For example, if someone is unable to afford taking out a whole life insurance policy, they might be better able to afford this option. As well as this, insurance companies often make this type of policy more readily available to people in poor health.
If you find yourself in a situation where you are unable, for whatever reason, to take out a whole life insurance policy, but you’d like to lighten the burden for your loved ones after you pass away, then final expense insurance is a great option.
Making Necessary Preparations
Nobody likes to think about what will happen after they are gone. But in order to make things as easy as possible for our nearest and dearest, sometimes a little planning is necessary. If you think you might be a good candidate for final expense insurance, don’t delay, and get your affairs in order today.
If you’ve enjoyed this article, have a look at the rest of our financial guides.