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The Purpose Of This Article Is To Differentiate Between Final Expense Life Insurance & Pre-need plan So You Can Decide Which Is Best For You
Many times my clients tell me they’re interested in getting a plan that will cover all funeral-related expenses. This is what we call a pre-need plan, and what I offer, in most cases, is totally different.
Final Expense Life Insurance essentially does the same thing as a pre-need funeral policy, but with some major differences.
Here’s An Overview Of Today’s Topics:
- Pre-Need Policies
- Whole Life Burial Insurance
- Pre-Need vs. Final Expense Whole Life
- And The Verdict Is
A pre-need policy is a specific policy sold by the funeral home. A pre-need policy does several things. First, it locks your pricing in place so you never
have a price increase on the cost of your funeral. But in exchange you either pay in one lump sum or you set up a payment plan. These payment plans can be for up to 10 years.
If something happens to you in the first few years of the payment plan, the pre-need plan might only cover a partial amount. After the first couple of years, you have full coverage if you die earlier than expected.
The beauty of these plans is they allow you to pick and choose exactly how you want your funeral to go. You talk with the funeral director and pick out the casket, the servicing, and how you want things. It really relieves the emotional burden from your family because it’s already prepared and planned.
However, the downside to this is the expense. The pre-need plans, generally speaking, are very expensive. The price for even a ten-year plan is $150 to $200 a month, all-inclusive. This makes for a dramatically expensive funeral, the cost of which is actually several times more than the value of the insurance.
Whole Life Burial Insurance
I sell final expense Whole Life Insurance. The way final expense whole life insurance works is very similar to your pre-need plan in a couple ways. First of all, our prices never go up. You pay a fixed price for the remainder of your life.
You also have the option of a life pay plan. This means you pay until you die no matter when that would occur. You can also do a paid-up plan. You pay it off in 5, 10, or even 20 years, but there is a definite payoff period.
Now, in addition to that, the coverage never cancels, so you don’t have to worry about outliving it. Also, the rates never go up, and you have full coverage, in many cases, from the first day. In other cases, you have partial coverage from the first day.
The point here is that the final expense plans I offer can do very much the same things as a pre-need plan. You can make the policy out to your beneficiary, or you can leave it to the funeral home. You’ve got a lot of options, and in many cases you can go to the local funeral home and plan out your funeral with the understanding that you’ve got a policy that you can leave to the funeral home. At the very least, you can let them know that they’re named as the beneficiary, and they’ll still go through the motions and give you a price guarantee.
Pre-Need vs. Final Expense Whole Life
What’s the biggest difference between a pre-need plan and a final expense plan? The main differences are, number one, most final expense plans
are life pay, and number two, the premiums for my final expense plans are dramatically less expensive than what one would find at a funeral home.
As I mentioned earlier in the pre-need section, the main reason people buy a final expense plan is because we can get a lower price that’s affordable for them. That’s really the key.
We all like the nicer things in life, but sometimes we have to sacrifice and get something that will do the job in a way that at least we can have some level of peace of mind. Many times the kind of plans that a funeral home will sell for $150+ we can get for $40-$50. The price difference is that dramatic.
A lot of fixed income seniors really like that because they’re on a limited budget. They don’t want to spend a dramatic amount of money every month for a pre-need plan they just can’t afford. It would be tragic to have to drop this plan halfway through and then not have anything to show for all those payments.
Burial Insurance Rates, Age 40 to 90*
Rates For $5,000 In Burial Insurance
Rates For $10,000 In Burial Insurance
Rates For $15,000 In Burial Insurance
Rates For $20,000 In Burial Insurance
Rates For $25,000 In Burial Insurance
*Burial insurance premiums are subject to underwriting, based on rates as of 8/20/2018, from state-regulated life insurance companies offering final expense burial whole life insurance protection. Understand that in order to potentially qualify, you must submit an application to see if you’re eligible. Rates are subject to change. Give Buy Life Insurance For Burial a call at 888-626-0439 now to see what program you may qualify for.
And The Verdict Is
I really advocate for those that have a very tight budget to get a Whole Life Final Expense plan. Now, in some cases, a paid-up plan may be actually a better compromise to a funeral home plan. If you’re looking at a funeral home plan and you’ve got a large budget, we can usually get you a much better deal in total premiums paid out versus what you can get through a pre-need plan with all the same benefits; you can name the funeral home and plan your arrangements.
If you would like to talk to somebody about the difference between pre-need policies and final expense policies, I would be happy to help. Just look over my website, and then give me a call or shoot me an email. I’ll be happy to give you a free, no-obligation quote to see what we can do for you.