Unless you are an active duty member of the military or a veteran, someone will have to pay for your funeral and burial when you die. And, even though the military helps with the costs of burying service members and veterans, the amount they offer will typically fall well short of the costs associated with a memorial service.
Knowing this, all of us must assume that someone will have to take care of the funeral and burial costs when we pass away. There are statutes in every state regarding the disposition of a body so there is virtually no way of circumventing these final expenses that everyone will eventually incur. For this reason, we will consider which companies offer the best final expense insurance.
What is Final Expense Insurance?
Simply put, final expense insurance is a life insurance policy that is designated to pay the final expenses that are left behind when you die. These final expenses are typically made up of funeral and burial expenses, medical expenses not covered by health insurance, and nursing home or hospice costs that were also left unpaid.
In most cases, funeral and burial expenses make up the majority of expenses that could be left for surviving loved ones to pay while making funeral arrangements. Although everyone knows that death is imminent, you would be surprised at how many adults who do not make these arrangements in advance so their family and friends won’t have to deal with them while they are mourning their loss.
Although a final expense insurance policy can be purchased using term insurance, universal life insurance, or whole life insurance, in most cases whole life insurance is the better choice because of the guarantees and benefits that are built into the policy. The best final expense insurance should provide lifetime coverage, level premiums, and cash value for emergencies. These benefits are all guaranteed when you use whole life insurance as the foundation for your final expense insurance policy.
Also referred to as burial or funeral insurance, final expense insurance is the best method for relieving the burden and stress that would be passed on to surviving loved ones when you die.
Is Final Insurance the Best Choice for Me?
Although anyone can buy a final expense insurance policy, in almost every case, insurance companies target seniors for this type of coverage. Seniors look at final expense insurance as a needed and affordable purchase for various reasons:
- They can qualify for the lowest rates without taking a medical exam
- They know as long as they pay their premiums they will be covered for their lifetime
- The death benefit is guaranteed by the insurance company
- They can cover their funeral expenses in advance
- They can cover other final expenses they don’t want to leave behind
- Depending on their age, they can typically purchase up to $50,000 in coverage
- When considering their age and health, the premiums can be very affordable
Even if you are still working and have insurance through your employer, having individual final expense insurance makes sense because group life insurance through work is not portable.
Which Companies offer the Best Final Expense Insurance?
Before we offer our suggested list of companies that offer the best final expense insurance policies, we need to clarify the different types of final expense policies that are being offered today. There are three types of final expense insurance policies available and there is a significant difference between each of them:
- Level Benefit Final Expense Insurance – The level benefit policy is typically the lowest priced coverage and should be the first choice for those who can medically qualify for coverage. Level benefit coverage pays the full death benefit from the first day of coverage whether your death is the result of an accident or natural causes.
- Graded Benefit Final Expense Insurance – Graded benefit policies are designed for applicants who do not medically qualify for level benefit coverage. They are a little more expensive than level benefit policies and the death benefit is “graded” for the first three years (depending on the company). Normally, under a graded benefit policy, the death benefit is paid out ay 25% the first year, 50% the second year, 75% the third year, and then 100% thereafter.
- Guaranteed Issue (Guaranteed Acceptance) – Guaranteed issue policies should be considered as a last resort. These policies do not take your health into consideration so virtually any living person who qualifies by age can purchase life insurance coverage. This is the kind of policy you normally see advertised on TV by companies like Colonial Penn or Lincoln Heritage. Guaranteed issue policies are much more expensive than level benefit policies and have a waiting period of two or three years before they will pay the full death benefit if death is the result of natural causes. With a guaranteed issue (guaranteed acceptance) final expense policy, if the policyholder dies from natural causes during the waiting period, the beneficiary will receive the sum of all premiums paid to the company plus an additional percentage of usually 5 to 10%.
Our Top 3 Companies that offer the Best Final Expense Insurance
We consider the following criteria when we list the best final expense insurance companies as:
- Highly-rated by A.M. Best and other rating services
- Competitive rates with other insurers
- Offers at least level benefit and guaranteed issue policies
- Provides outstanding customer service and claims service
Americo is one of our go-to carriers because they offer multiple types of final expense insurance and various riders that can broaden coverage and provide living benefits. They are a solid selection because:
- They typically rank in the top five for insurance rates
- They offer three types of level benefit insurance policies
- The company is rated A (Excellent) by A.M. Best
- They deliver outstanding customer service and claims service to policyholders and agents
Mutual of Omaha, one of America’s most well-known insurance companies offer several types of whole life insurance which makes this carrier one of our top choices for the best final expense insurance. They rank highly in each of our categories:
- Mutual of Omaha normally ranks in the top five for their insurance rates
- They offer level benefit and graded benefit insurance policies
- Mutual of Omaha is rated A+ (Superior) by A.M. Best
- The company is one of the best we do business with when it comes to customer service and claim service
Although AIG only offers guaranteed issue final expense policies with a 2-year graded benefit period, they are typically our go-to carrier when it comes to applicants with serious or multiple health issues who cannot qualify for a level benefit or graded benefit final expense insurance.
- AIG is typically ranked in the top three for guaranteed issue life insurance
- They offer a terminal and chronic illness insurance benefit with their policies
- Their death benefit is graded over two years rather than three
- The company continues to earn extremely high ratings from national rating services
For most people who have recently purchased final expense insurance, they were able to purchase their policies over the telephone through an independent insurance professional who offers instant quotes online. Purchasing the best final expense insurance can be done quickly and affordably when you select agents like Best Benefit Insurance and Financial Services as your number one resource for quality life insurance products.