What Is Final Expense Insurance?

The FTC estimates a traditional funeral costs around $6,000.
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Some people have very definite ideas about what they want to happen at their funeral, while others couldn't care less. Whichever side of the fence you fall on, you should be prepared for the fact that funerals don't come cheap. The Federal Trade Commission estimates that many funerals can run to well over $10,000. If you don't have the ready cash to pay for your burial or cremation or don't want your estate to be eaten up with costs incurred by your passing, a final expense insurance plan could be for you.

What It Pays For

A final expense plan, also known as burial insurance, is designed to pay for the costs associated with your death. The amount a policy will pay out will depend on how much you pay in premiums over the life of your plan. The beneficiary of your coverage can use any payout to meet your funeral costs, pay probate and clear any outstanding debts you leave. If you pass away without any savings and no insurance, somebody else will have to fork out for your funeral.

Term or Whole Life

Burial cover plans come as either term life or whole life policies, according to Insure.com The former will provide a payout if you die during the term of your plan, say 20 years, while the latter will cover you for the rest of your life. If your term life policy expires without a claim being made, you will have to take out a new policy to keep coverage. The older you are, the higher your premiums are likely to be.


Make sure you trust the beneficiary of your policy. Although you'll be able to leave instructions as to how you want any payout spent, Insure.com advises that the beneficiary of your plan will be legally able to spend the money how she wishes and keep anything that's left. You'll probably be better off entrusting any payout to your partner or a close relative rather than one of your buddies from the local sports bar.


You won't have to go through a medical exam to get burial insurance, but will typically be asked to swear that you're not currently ill. If you suffer from poor health, you could have to take out a graded benefit that would only pay out a portion of the value of your policy if you were to die over the first few years of coverage. If you already have a life insurance policy, you should consider using a portion of any payout from this to meet your funeral costs. This will usually be cheaper than paying for a final expense plan.

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