Life Insurance – Final Expense
Life insurance can protect your family and loved ones from financial hardship
Life insurance is a contract with an insurance company. In exchange for premiums (usually monthly payments), the insurance company will provide a lump-sum payment on the death of the insured to their beneficiaries.
Do you need life insurance?
Unless you have a lot of resources to leave your family after your death – you probably do need life insurance. A life insurance policy is an investment to ensure that your family does not struggle financially after your passing.
How much life insurance do you need?
The best way to determine this is to make a list of your family and dependents needs – list items such as their living expenses, mortgages, college education etc.
Circumstances vary widely between families so it is difficult to establish a rule-of-thumb figure. Essentially, consider their needs and means, and obviously, what you can afford.
A PMB Senior Services expert can help you compile this list and assist you in determining what life insurance policy would work best.
What does life insurance cost?
The cost of life insurance varies greatly. Not only does the type of policy define cost, but also your stage of life and health. Insurance companies look at the risk of the individual applying for coverage; age, occupation, health, smoking, weight and other factors.
What is Final Expense insurance?
Final Expense life insurance is a whole-life policy that pays upon the death of the insured. There is no term limit, and premiums are level with an investment (cash accumulation) feature.
Why is final expense insurance important to protect those you love?
- Most families have a hard time finding the funds to cover final expenses.
- Social Security only pays $255 for those who qualify for final expenses.
- The average cost for a funeral is between $7,000 and $10,000.
- There are always additional costs over and above funeral and burial bills that will have to be paid.
- A final expense policy can eliminate the inevitable burden your family will have to face.
Life Policy Comparison Table
Term Life
Has a set duration or time limit on the coverage – typically, 5,10, 15 to 30 years life cover. once the term period is reached coverage ends.
Whole Life
Pays a stated amount upon the death of the insured whenever you die (does not have a fixed term). Level premiums with an insurance and investment component.
Universal Life
A more flexible type of permanent life coverage with an invested savings element.
Guaranteed Death Benefit
Yes – as long as the premiums are paid as required.
Yes – provided the premiums are paid, the death benefit is guaranteed for the life of the policy.
Death benefits are adjustable according to the policy.
Advantages
Most affordable and simple coverage, though for a limited period of time.
Provides life time coverage with access to the accumulated policy cash value.
Offers flexibility in terms of coverage.
Lifetime Coverage
No – coverage is only for the specified term period.
Yes – as long as premiums are paid coverage is guaranteed for the life of the policy.
Death benefits are adjustable according to the policy.
Cash Value
No – unless a Return of Premium rider is included.
Yes – cash value growth is tax deferred.
Yes – cash value growth is tax deferred.