Seniors Funeral Insurance Guide for Planning Ahead

Planning ahead for a senior's funeral can be a difficult and emotional task, but it's also a thoughtful way to ensure their wishes are respected. The average cost of a funeral in the US is around $7,000 to $10,000.

As we age, it's essential to consider our funeral expenses and how they will be covered. Many seniors find themselves struggling to pay for funeral costs, which can lead to financial burdens on their loved ones.

A senior's funeral insurance policy can help alleviate this burden, covering expenses such as cremation, burial, and memorial services. This type of insurance can be tailored to fit individual needs and budgets.

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Final expense insurance is a type of permanent life insurance that helps cover end-of-life costs, including funeral expenses, medical bills, and unpaid debts.

It's a tax-free benefit that can be used for any purpose, and you can even designate a funeral home as your beneficiary to receive the payment directly.

Everyone who applies for final expense insurance gets approved, no medical exam required, just a few basic health questions.

This type of insurance builds cash value over time, which you can borrow against like a personal loan, but if you don't repay it, it'll be taken out of your death benefit.

Final expense insurance is a good option for seniors or those with health issues that make it hard to get approved for term life insurance.

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Burial insurance for seniors, also known as final expense insurance, is a type of life insurance designed to cover funeral costs and other end-of-life expenses.

These policies usually have smaller coverage options, typically $50,000 or less. No medical exam is required to qualify, and seniors can still obtain a new policy despite having severe health issues.

Simplified issue policies have underwriting, where you must answer health questions, but no medical exam is required. These plans are generally the least expensive and can offer immediate peace of mind because the full death benefit pays out starting on day one.

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Guaranteed issue policies, also known as "guaranteed acceptance", have no health questions because your approval is guaranteed. However, there's always a two-year waiting period for non-accidental death and more expensive premium payments than simplified issue policies.

Here are the key differences between guaranteed and simplified issue policies:

The cost of funeral insurance for seniors can vary depending on several factors, including age, gender, tobacco usage, health conditions, and state of residence. The average cost for a $15,000 policy is $75-$150 monthly.

Burial insurance policies can be purchased for small amounts, such as $5,000 or $10,000, while other whole, guaranteed universal, or term life insurance policies may require substantially larger minimum coverage amounts of $50,000 or $100,000.

A $25,000 guaranteed-issue policy for a 70-year-old male in Texas can cost around $215-$268 per month, depending on the provider. To give you a better idea, here are some quotes from a few providers:

These rates are based on a guaranteed-issue policy, meaning no health questions or medical exams are required.

Burial insurance policies cover all the normal costs incurred by someone's death, and these costs can add up quickly. According to the Federal Trade Commission, costs may include embalming or preserving the body, a casket, flowers, cremation costs, a burial plot, the cost of transporting the body and/or cremains, a headstone with customized carving, payment to a minister or priest, rental costs for the venue where the memorial service is held, and the cost to open and close the grave.

A senior burial insurance policy can cover funeral services, burial costs, cremation costs, funeral home fees, headstone or other memorial monuments, medical bills, transportation expenses, and credit card debts or other outstanding debts.

Burial insurance can also be used to cover the deceased's outstanding debt, such as medical bills, credit card debt, or even a mortgage. If you're married and die before your partner, they could use some of your policy's death benefit to pay down the mortgage.

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Here are some of the specific expenses that burial insurance can cover:

The cost of burial insurance varies depending on factors like your age, gender, and the amount of coverage you need. For example, a $25,000 guaranteed-issue policy for a 70-year-old male in Texas can cost around $215.25 per month with Mutual of Omaha.

To give you a better idea, here are some common burial insurance rates for a $25,000 policy:

The cost of burial insurance can seem like a good deal, especially compared to larger life insurance policies that may require minimum coverage amounts of $50,000 or $100,000. However, it's essential to get personalized quotes to determine the best fit for your budget and needs.

The average burial costs around $9,995, including a vault and viewing, according to the National Funeral Directors Association. To cover these costs, you may want to consider a burial insurance policy with a coverage amount of at least $10,000.

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You can qualify for a senior's funeral insurance policy if you're 18-85 years old, and you'll get approved without any medical questions asked. This is because most states offer a guaranteed acceptance policy for this age range.

However, if you're outside of this age range, you'll still be able to get a policy, but you'll need to answer health questions. You can't get a policy if you're older than 90, as that's the age limit for life insurance.

To apply for a policy, you'll need to be physically located in the USA and have either an SSN or TIN. You'll also need to provide basic information such as your name, DOB, mailing address, and beneficiary names.

Colonial Penn is a great option for seniors looking for life insurance, as they sell only life insurance and offer a guaranteed acceptance policy that can be used for burial costs.

These policies don't require medical exams or health questions, making them easy to obtain.

You can borrow against the cash value of the policy with Colonial Penn, and flexible payment options are available.

Colonial Penn also offers competitive rates and guaranteed prices.

However, keep in mind that they have a higher-than-average NAIC Complaint Index score.

Transamerica offers a flexible and convenient solution for burial insurance with its Final Expense Express Solution, which allows for instant approvals and electronic policy delivery.

Their policies are available without a medical exam, and coverage amounts range from $1,000 to $50,000.

For seniors over 75, coverage amounts with Transamerica are limited to $25,000.

Transamerica also offers helpful tools like the Concierge Planning Rider, which assists with funeral arrangements and legal documents at no extra cost.

AARP, in collaboration with New York Life, offers burial policies and life insurance specifically geared toward seniors.

AARP membership is required to qualify for these policies, and standard membership costs $16 a year.

AARP policies typically have guaranteed acceptance, and there is no health questionnaire required.

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Filing a claim for senior's funeral insurance is a relatively straightforward process. Your family members will need to notify the insurer of the insured's passing by making a phone call.

The process is exactly the same as a traditional life insurance policy. The insurer will send the beneficiary claim forms that need to be signed and returned with a copy of the death certificate.

You'll need to have the death certificate on hand to complete the claim process. This paperwork is essential for the insurer to process the claim and pay out the money.

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If you're considering purchasing burial insurance, it's essential to weigh your options carefully. If you have a pre-paid funeral, you may not need burial insurance.

Having a pre-paid funeral or cash set aside for final expenses can eliminate the need for burial insurance. This can also be a more cost-effective option in the long run.

Broaden your view: What Insurances Do I Need

To determine if burial insurance is right for you, consider your existing financial situation and insurance plans. If you have an existing permanent life insurance plan with a sufficient death benefit, you may not need burial insurance.

If you're unsure about your options, take a closer look at your financial situation and insurance plans to make an informed decision.

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Burial insurance is a good idea if you have no other means to pay for your funeral costs, and it can be a lifeline for families in difficult financial situations.

In fact, a burial expense policy can provide the funds necessary to cover your final bills whenever you die, giving your family peace of mind and ensuring they don't face unexpected financial burdens.

However, if you have a pre-paid funeral, cash set aside, or an existing permanent life insurance plan, burial insurance may not be necessary.

Here are some scenarios where burial insurance is worth considering:

It's also worth noting that burial insurance can be a valuable choice for those in better health, especially if they want to avoid graded death benefit periods.

To buy a final expense policy, you'll need to contact an insurer directly or work with a licensed insurance agency. This is the most straightforward way to get started.

You must be physically located in the USA and have either an SSN or TIN to apply for a policy. This is a basic requirement that most insurers will ask for.

You can expect the application process to be relatively quick, with approval typically taking less than 24 hours. Once approved, you'll receive a paper policy via US mail within two weeks.

To apply for a policy with no waiting period, you must complete a health questionnaire. This is an additional step that's required for certain types of policies.

You can work with an insurance agent to ask questions and get price estimates without your parents' participation. However, their consent is still needed to formally apply for the policy.

Here are the basic pieces of information that insurers will typically ask for during the application process:

Keep in mind that even if you have a power of attorney over your parent or grandparent, it doesn't empower you to answer the health questions and sign on their behalf.

When comparing a burial policy vs life insurance, it's helpful to remember that burial or funeral insurance is a type of life insurance.

Burial insurance plans are a particular type of permanent life insurance with small coverage options.