The Regional Municipality of York – Aurora, East Gwilimbury, Newmarket, Markham, Richmond Hill, King, Georgina, Vaughan, and Whitchurch Stouffville, has a senior population of 146,465 seniors aged 55 to 64 years old as of 2016.
This senior population can take advantage of a very smart insurance product called final expense insurance. This type of coverage is a tool that can be used to set aside money to pay for funeral and burial costs.
We know that this is not an attractive topic for discussion. Unfortunately, we all need to think about how to pay for these expenses because they are inevitable.
Did you know that the average cost of a modest funeral in Ontario can range from $9,000 to $20,000? It is definitely no small amount and any family can be at a loss on how to pay for this cost upfront.
Final expense insurance is easy to obtain and offers affordable premiums for coverage that can pay for funeral or burial expenses.
Find out more and compare prices using our short online form on this page. Receive FREE and NO-OBLIGATION quotes from our reliable insurance partners!
To know whether you need final expense insurance, it is important to understand its many benefits for seniors.
Final expense insurance is a type of life insurance that is specifically designed to pay for final expenses – funeral, burial, cremation, etc.
Thus, it is also known as funeral insurance or burial insurance. Unlike funeral plans which are purchased directly from funeral homes, final expense insurance is offered by insurance companies. The cash benefits are paid to a designated beneficiary who is free to use the money based on your final wishes.
You must be wondering what is the difference between final expense insurance and life insurance? Do you need it if you already have life insurance coverage?
There is no one-size-fits-all answer for this question so we will try to cover several scenarios to help you understand.
Who benefits from final expense insurance?
If you are a senior and have no money set aside for funeral expenses or burial costs, taking out a final expense insurance policy is a good call. The benefits can be used by your family to pay for funeral expenses. By providing for this expense, you reduce the financial strain on your loved one when you pass away.
Life insurance is generally meant to replace lost income so that family members will not suffer financially if you should pass. And while life insurance proceeds can also pay for final expenses, especially if the insured benefit is more than adequate, getting a separate final expense insurance coverage will be useful if you want your financial legacy to be solely for the benefit of your dependents.
Both final expense insurance and life insurance benefits are tax-free.
How about if you have no life insurance coverage and don’t qualify for coverage because of your advanced age or poor health?
Final expense insurance is an ideal solution for older individuals and seniors with no life insurance or inadequate coverage but who find it difficult to qualify for standard insurance.
If you have medical pre-conditions that make you ineligible for term life insurance, you can still qualify for final expense insurance.
Final expense insurance is easier to obtain because it offers two options – simplified issue and guaranteed issue.
Under simplified issue, you only need to answer a short health questionnaire (5 to 8 health questions) and many pre-conditions are still accepted.
Under guaranteed issue policies, approval is almost 100% and no health questions or medical check is required.
Due to the ease of application and approval, final expense insurance coverage is limited in terms of maximum insured benefits. Most insurers offer from $5,000 to $25,000 although a few insurers offer as high as $50,000.
The premiums for final expense insurance policies are also more expensive than standard life insurance.
To shop for final expense insurance coverage, it is best to connect with a licensed and reputable insurance broker. Unlike life insurance agents, brokers work with a variety of insurers and can offer you the widest choice to find the right policy that suits your needs.
Our network of insurance brokers can shop for the best offer for you in terms of pricing and benefits. Receive FREE and NO COMMITMENT quotes to compare when you fill out our short online form!
Final expense insurance is also no-medical life insurance.
Unlike standard life insurance policies that need a medical examination to set your premiums, no-medical life insurance is fast and provides easy coverage to benefit your dependents.
In the event of your death, your designated beneficiary will receive tax-free benefits that can be used to pay for:
Sometimes, no-medical life insurance is the only choice for seniors or older adults due to their age and health conditions.
When you apply for life insurance, the insurer usually wants an extensive examination of your health to assess the risks you present. This information is used to determine the cost of your coverage. If you have certain pre-existing health conditions, you can be denied.
With no-medical life insurance, the insurer agrees to provide you with protection so that beneficiaries can collect cash benefits at your passing. But due to the higher risks, your premiums will be much more expensive for lower insurance benefits.
While it is less desirable than standard life insurance, it is far better than no coverage at all.
Many seniors want to ensure that their families have enough funds to pay for a funeral service or other debts left behind after their death. No-medical life insurance is a hassle-free and quick option to meet these goals.
If you have been previously denied coverage by an insurance company, you can still qualify for no-medical or final expense insurance.
Most final expense insurance policies offer benefits less than $50,000 with average insurance coverage of $10,000 to $20,000. The approved benefit varies based on health status, type of policy (simplified or guaranteed issue), age, and other factors.
There are actually 4 types of final expense insurance, namely:
Below you will find comparisons to help you understand how they differ:
|Health Status||Very good||Minor health issues||Serious health issues||not considered|
|Eligibility for payout||Immediate at death||waiting period|
(2 or 3 years)
Level policies are for individuals in relatively good health. Insurers check whether you are taking prescriptions, have had surgeries, or have health conditions. These policies go through underwriting and their cost is the lowest among final expense insurance policies. Death benefits are also paid immediately after the insured dies.
Graded policies have a 2-year waiting period before complete death benefits are paid. Most insurers only pay a refund of premiums within the waiting period.
Modified policies work like graded policies and have a waiting period. Health conditions of the applicant determine if they qualify for a graded or modified policy.
These plans are provided to individuals with high health risks and have a waiting period of 2-3 years. Individuals with a modified plan are usually taking prescriptions for one or more health conditions. If the insured individual should die within the waiting period, beneficiaries only receive the premiums paid and a small percentage.
If you get approved for a modified plan, the coverage will be lower.
Guaranteed issue policies accept all individuals because the insurer does not check on your health as long as you meet their age requirements. They are the most expensive and carry a 2-year waiting period.
Health conditions that insurers consider
To give you an idea of what health conditions are considered by insurers when classifying applicants for graded or modified policies, refer to the list below:
|Moderate risk (Graded)||High Risk (Modified)|
|Diabetes (minimum insulin intake)||Alzheimer’s|
|Heart attack (not recent)||HIV, AIDS|
|Hypertension||ALS, Lou Gehrig’s disease|
(depending on certain criteria)
** May vary among insurers. This is not a comprehensive list.
The average cost paid by seniors in the York region for a final expense insurance policy is anywhere from $30 to $70 a month. The price depends on gender, age, health status, and insured amount.
Younger adults may pay as little as $20 to $50 for a $20,000 coverage while seniors 70 years or older may pay from $70 to $120 monthly.
Keep in mind, though, that a cheaper premium does not always make the policy the best choice for you. A slight increase in the price can mean a higher benefit and more support for your beneficiaries when you pass.
More often than not, people focus on the price as the deciding factor when buying insurance. Instead of looking at the cost, though, it is smarter to think about the price your family will have to pay when you leave them behind. Make sure that you are buying final expense insurance that will be a big help to them in paying for your final expenses.
The cost of funerals has been rising steadily over the years. As of 2019, the average price of a funeral in Ontario costs from $9,000 to $20,000.
Although direct cremation can cost only $1,500 or so, add in the price of a casket, vault, grave marker, ceremony, obituary, and other miscellaneous costs, the final bill can easily approach $10,000.
The cost of a funeral really depends on what you want. Below is a list of standard expenses to help you determine how much you need. Professionals often recommend coverage of $10,000 to $15,000 for final expenses.
|Death certificate||$55 or higher|
|Body transfer||$150 or higher|
|Casket or urn||$100 to $3,000|
|Body preparation||$150 to $500|
|Memorial, visitation, funeral service||$2,000 or higher|
|Niche or plot||$1,000 minimum|
|Cremation or burial||$1,000 or higher|
Funeral homes or chapels allow many options when it comes to funeral services and ceremonies. Families can request music, flowers, food, and even a broadcast of the service over the internet.
Prices can also vary by province or city.
What does final expense insurance pay for?
Final expense insurance can pay for end-of-life expenses such as cremation, funeral services, burial, or medical, credit card bills, and other final expenses. The beneficiary has the discretion to use the funds for any purpose.
Why are rates different for life insurance?
Insurers have different rates because people are not all the same and need different amounts or types of coverage, too. Insurers also consider factors such as age, weight, health conditions, and lifestyle so that those with lower risks don’t pay as much for premiums as higher-risk individuals.
Why do I need final expense insurance if I have group life insurance?
Group life insurance is coverage provided by a company or association that you belong to. The insured amount from group life insurance is usually not sufficient to replace income or settle final expenses.
Further, when you cease to be a member- quit, retire, or terminated, you lose coverage. For these reasons, many individuals decide to get a personal life insurance policy that will be available to their beneficiaries when they pass.
If you still qualify for standard insurance coverage, you can buy a small policy to cover your final expenses. If you are older or a senior, you also have the choice of buying final expense insurance or no medical life insurance. They will not expire and will be active regardless of your age at death.
How does funeral insurance work?
Funeral insurance or final expense insurance works like life insurance – death benefits are paid to a beneficiary once a claim is approved by the insurer. The application process is faster and easier but the insured amount is much lower.
What is the maximum age to get final expense insurance?
It varies among insurers but generally 70 to 80. The higher the age, the more expensive the premiums.
Are death benefits immediately paid out after the insured dies?
Each insurer has a claims process. Most insurers have a processing time in weeks. There are a few companies that boast 24-hour processing for final expense insurance benefits. It is best to check with the insurer to be sure.
How much does final expense insurance cost?
It is difficult to say for certain what the cost of your premium will be without knowing specifics such as age and gender. However, if your health is not a high risk, you can expect to pay from $30 to $70 monthly for a policy with $10,000 in coverage.
What features can be found in a final expense insurance policy?
Not all policies are the same and insurers may offer unique features. All of them have one thing in common – a guaranteed death benefit for your loved ones. Others may offer funeral planning assistance, accidental death and dismemberment, or child riders. It is important to read the fine print of the policy and review the terms and conditions.
Does a final expense insurance policy expire?
No, final expense insurance coverage is like permanent life insurance; it does not expire. As long as premiums are paid and up to date, death benefits are paid to beneficiaries regardless of when death occurs as long as it is not within the waiting period.
Is final expense insurance the same as life insurance?
Yes and no. They both provide cash benefits which can be used to pay for expenses after death. However, standard life insurance has higher benefits because it is meant to replace income. Final expense insurance has lower insured amounts because they are obtained usually by seniors to pay for funeral or burial expenses.
What final expenses should you plan for?
Most seniors include medical bills, funeral or burial costs, and other small loans or bills when planning to buy final expense insurance. The average insured amount is from $10,000 to $25,000.
Each insurance company sets its own prices for final expense insurance. To find the best price for final expense insurance, it is important to compare multiple quotes from insurers in your area,
The best way to find the best policy and coverage is to work with reputable and licensed brokers who can shop for insurance on your behalf, free of charge.
Their services are free and you can have more options to choose from to make sure that you get the right coverage within your budget.
There are many final expense insurance policies out there but which one is the best for your needs? Which policy can give more benefits to your family? These are questions that you must consider when shopping for final expense insurance.
Fill out the form on this page to receive FREE and NO-OBLIGATION quotes from our partner insurers and brokers.
Get peace of mind and give your loved ones a final gift of love
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