Do Seniors Need Final Expense Insurance?
October 1st, 2011 | 
Author: 
I watch TV when I work. Well, I really do not watch TV, but I have it on in the background for noise. I usually watch a news or history channel, and I do notice the commercials. During the day, they frequently have an ad with a nice looking retired couple who are discussing senior life or final expense insurance. Since I see so many ads for this product, I figured that it was something that people are concerned about.
When we are younger and taking care of kids or paying off a house, we are told to buy term life insurance. The benefit will cover our families if we should pass away, and that is the only time we really need coverage. We are told that, ideally, we should have our kids paid off by the end of the term. We should also have our home paid off. Plus, we will have had time to pay off debts and put away savings for retirement.
Well, that’s great, except life does not always work out that way. The savings we pinched pennies to put away do not go as far as we thought they would. Some of us lost jobs and had to take out a second mortgage, and so we still owe on our home. Some of our kids did not take off as quickly as we thought they would, and we may even have them, and their own children, depending upon us. Besides, we think it would be nice to leave them something if we pass away, and we certainly did not mean that something to be a funeral bill and other debt!
Final expense insurance plans are also called burial policies sometimes. Basically, they are a form of whole life insurance that has been designed for middle aged people and senior citizens. The face value is fairly low, usually from $2,500 to $25,000, and so premiums are usually affordable and the application process is short and painless.
Simplified issue policies ask very few health questions, so even seniors with some health problems can qualify. Guaranteed issue policies do not ask health questions at all, but may not offer an immediate death benefit and are more expensive. If you can qualify for simplified issue life insurance, do not run out and buy the first guaranteed issue policy you see on TV! However, if you cannot qualify for a simplified issue policy, a guaranteed issue policy is not a risky thing to buy. Most policies will not pay the full face value before a waiting period of 24 to 36 months, but will pay back all premiums with interest if the insured person passes away before that date.
So, do you, or your parents, need a final expense policy? Well, if you and your kids have plenty of cash in the bank, you may not. A funeral can cost $8,000 to $10,000 or more, so consider that as a big expense somebody will have to pay during a stressful time. Beyond the funeral, your family may have travel expenses, medical bills, and other debts to consider. These policies can provide the cash to relieve that burden, at least.
Posted in 
Tags: