Final expense insurance will pay out a sum of money when you, the policyholder, pass away. Let’s discuss the death benefit timeline and the money you’ll receive.
How the Final Expense Death Benefit Works
If the death benefit is only issued after you pass away, who does it go to? You get to choose — this person or people are your beneficiaries. You name them when you purchase your policy, and they will receive the $2,000 to $50,000 to use on your behalf.
So, why pay for a policy when the money goes to someone else? Because things like funeral planning, medical bills, and credit card payments add up, and your loved ones are held responsible if you don’t give them something to pay for it with.
This isn’t meant to sound intimidating or exaggerated — it’s important to understand that final expense gives peace of mind and financial security.
The Death Benefit Process
The death benefit isn’t paid out until you pass away. Your death benefit, then, may not be paid out for years. But the purpose of the policy is for costs that won’t need to be paid for until then, hence the name “final expense.” It literally covers your final, end-of-life expenses that come up when a person passes away.
How to Use Your Death Benefit
One of the most common uses of final expense is funeral planning. With price tags ranging from $1,000 to more than $10,000, it’s easy to see why final expense coverage is so beneficial. Rather than having $10,000 in the bank, you can pay your monthly premium and be covered. This is especially helpful in case you pass away sooner than you can set aside money.
The same applies to other expenses like credit card payments and medical bills. Even if you don’t have a set plan for what you’d like your policy to cover, that’s okay — as the costs roll in, your loved ones can use the funds to pay for all of it.
Of course, having a game plan for your policy is very useful. Be sure to talk over your plans with your beneficiaries, that way they know exactly what to do when the time comes.
Plan Your Insurance with Experts that Care
Ask questions, make plans, and enroll in a final expense policy with confidence. Expense Mutual works hard to help you along every step of your insurance journey. To learn more, call us at 470-761-4652.