Final Expense

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We specialize in getting you the best Final Expense policies possible.

Many people don't know or understand the full options out there, and of course, these options are also changing all the time. 

See below for a full Q&A on Final Expense policies.


Frequently Asked Questions About Final Expense Policies

 

 1) Why do people buy them?

To provide security and peace of mind that you are not leaving a financial burden on your family.

2) Who is the beneficiary?

Usually a spouse or child or other living relative who will handle the final wishes of the deceased. 

3) What if there is money left over?

The family can use these funds as needed for funerals and medical bills.  If there is more than is needed they can keep the funds. 

4) Is there a limit to how much I can buy?

Because of the simplified issue of these products they usually max out at around 30k.  Several policies can be purchased however to increase the benefit to fit the need.  

5) Is a final expense policy a pre-paid funeral?

No.  A final expense policy can be used to fund a funeral but it is not the mechanism behind a prepaid funeral. 

6) Why buy a final expense if I have a pre-paid funeral?

To increase the estate size and to leave more to your family if these are your wishes. 

7) Can I spend the cash value in a final expense policy?

Yes you can get access to the cash value which will then decrease the death benefit.  Because of this access the cash value is also naked to a Medicaid spend down.

8) How do I avoid losing my cash value in a Medicaid spend down?

You must be aware of this situation and you must be aware of the laws that allow you to 1035 exchange your cash value into a funeral trust.

9) What is a federal trust?

A funeral trust is a legal document that currently allows 15k per person to be funded.  This immediately protects the cash value from a spend down. 

10) Will a Medicare Spend down affect my Final Expense Policy?

You must be aware of this situation and you must be aware of the laws that allow you to 1035 exchange your cash value into a funeral trust.

11) What is the difference between Final Expense Insurance and a Funeral Trust? 

Final Expense is a loosely or non-underwritten Whole Life policy that is usually only up to 25 to 30k in death benefit.  They accumulate cash.  That Cash is not protected from Medicaid.  A Funeral Trust is basically a protected savings account where the funds are paid direct to the funeral home.  They can be written on any individual with up to 15k per person protected from debtors as well as the Medicaid system.  It is not life insurance.  Both are used to fund funerals.  That is where the confusion comes.  We like people to have Final Expense policies as they create more value for the family. However we sometimes find them with cash value in them at a time when the family may need to consider getting rid of them because of Medicaid Spend Down rules.  When we find these situations we do a 1035 exchange from the Final Expense Cash value into the Funeral Trust to protect the cash.  What happens to the death benefit of the life policy at that point varies.  Kids or other family members can take it over or it can be left to collapse and it just goes away.  

12) What is the benefit for me to buy a Final Expense Policy?

To provide security and peace of mind that you are not leaving a financial burden on your family. 

13) What is a funeral trust?

A funeral trust is a legal document that allows a specific amount per person to be funded.  This immediately protects the cash value from a spend down.  See our other FAQ