Know Before You Go — Four Benefits Of Final Expense Insurance

07/08/2015 04:45 pm ET Updated Dec 06, 2017 Michael Lazar, Contributor

It’s a fact, we are all going to pass away some day. How much that affects our family’s budget at the time of our passing is up in the air, however. Know before you go about these four benefits of final expense insurance.

Choose Your Own Funeral Home and Funeral Type

Dependent upon what final expense insurance plan that you take out, there may be options to choose the funeral home and funeral type of your choice. A quick look around online finds that most major providers of this insurance type allow for the policy holder to determine where the funeral is held and where the body is buried. If you are shopping for this type of insurance, be sure that you are aware of what your options are in this regard before choosing a provider.

Not Based On Medical History

Unlike some other insurance types, final expense insurance is not based upon your medical history. It’s one of the main perks that Bankrate lists as reasons to consider adding such protection to your portfolio. Premiums are typically determined by the age of the applicant, and can and do vary between providers.

Pays Funeral Home Directly

Let’s say that the unthinkable does occur resulting in the loss of a loved one. With the proper final expense insurance, you can arrange for payment — up to the covered amount — to be tendered directly to the funeral home of your choosing. Most insurance companies offer a plan such as this, so you can focus on making arrangements and planning for the memorial service and wake instead of worrying about cutting checks to a funeral home.

Offsets Average Funeral Cost

According to Funeral Tips, the average cost of a funeral is $7,000, but can go as high as $10,000. This includes things like the cost of the headstone, paying a funeral director, casket, embalming, service, grave digging and grave site, grave liner and burial container and other associated costs. Adequate burial insurance can offset some or most of these costs, depending upon the plan that you take out. In some cases, the premium can also gain in value over time, like other insurances, and can be cashed out (varies between providers).

Being as prepared as you can be for any unforeseeable expenses is the primary reason to assure that you have adequate insurance. Before you decide to take out a policy with any insurance provider, good advice consists of conducting ample research, comparing policies and premiums, and even requesting a referral to an insurance agent from a trusted family member or friends.

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