Final expense insurance, explained

A short, honest guide: what this coverage is, what it is not, and the questions worth asking.

What it pays for

Final expense insurance pays a cash benefit to your beneficiary. It is not tied to a funeral home, so your family decides how to use it: funeral or cremation, burial plot, headstone, medical bills, debts or simply time off work.

Who it is for

It is meant for people who want to make sure their family is not left with the bill. Many plans accept applicants between about 50 and 85. Younger people with a family to support often look at term life insurance instead; see life insurance basics.

Common types

• Simplified issue: no medical exam, but a few health questions. If you qualify, coverage usually starts right away.
• Guaranteed issue: no health questions. In exchange, there is usually a waiting period (often two to three years) before the full benefit is paid for death from natural causes.

Questions to ask the agent

• What is the monthly premium, and can it ever go up?
• Is there a waiting period? What happens if I pass away during it?
• Does the coverage ever end, for example at a certain age?
• Which insurer issues the policy?
• Can I cancel, and is there a free-look period?