If you’re over the age of 60, then you’ve probably started getting mailers from AARP and other insurance companies about arranging for the money to pay your “final expenses“. So what are they talking about and what do you need to know?
Final expenses are the costs that need to be paid when you die. These include the handling of your body by the mortuary, your casket or an urn for your ashes, the funeral or service, and your burial. You probably won’t be surprised to hear that there is an entire industry surrounding each of these options and there are many choices for everything. Prices for everything from flowers to funeral parlors can very widely, even if you’re comparing in a small area. Some people want to plan everything before they die and some don’t, but the question that always needs to be answered is – How do you want to pay for this?
None of us really likes to think or talk about these things. For many people who have reached retirement age, however, planning becomes a little more important. The cost of a funeral, a standard casket, and burial can exceed $8-10,000. If you’re able, you might set aside the money in an account for the person you want to handle things. Just make sure they will have access to the money when it’s needed.
Many of us expect our life insurance policies to pay for things but there is something you need to keep in mind. Most life insurance policies do not pay immediately. First, the life insurance company needs to see the death certificate. Then there is often some processing that takes more time. Keep this in mind when making plans. If your son or daughter will be arranging things, they may have to pay out of pocket and wait to be reimbursed.
One option that is becoming more popular is a Final Expense Life Insurance policy. This is a smaller life insurance policy that will provide the money to pay for your associated death expenses. This will cover the cost of the mortuary, the funeral, the burial, everything if the policy provides enough money. These policies typical range from $8,000 – 20,000.
One provider of Final Expense Life Insurance policies is a company called Lincoln Heritage Insurance Company (Lincoln Heritage), a 48 year old company located in Arizona. They offer a program with several advantages that is available in most states.
First of all, their agents do field underwriting and, unlike many companies, there is no two year waiting period before coverage begins.
Second, their policies pay direct to your beneficiary within 24-48 hours of death in most cases, without a death certificate.
Third, they can write coverage with payments as low as $15 a month.
Fourth, their policies typically include Accidental Death Benefits (including loss of life due to acts of war or terrorism) in units of $5,000 for just $1 a month in many cases.
Fifth, and this is extremely important, they provide a membership at no cost in the Funeral Consumer Guardian Society (FCGS) for all of their clients. FCGS is an organization that helps individuals and families with their funeral planning. Even more important, they will act as an advocate for their members to get the lowest prices. This membership costs $299 for an individual or $399 for a family, but it’s included at no cost when you get your Final Expense Policy from a Lincoln Heritage insurance agent.
I want you to think about something. Imagine that (hopefully some years in the future), you’ve become sick and you’ve been in the hospital for three weeks. Your son or daughter or the person most likely to handle things (let’s call her Mary) is sitting by your side at 3 am and the nurse comes in to tap Mary on the shoulder and tells them that you’ve passed away. They’ve done everything they can for you and they’re very sorry for Mary’s loss. But they need the room for another patient and would appreciate it if Mary would make arrangements for your body right away. Remember, it’s 3 am. What is Mary going to do? Who can she call? How does she make clear decisions when she’s feeling so bad?
If you’ve got a policy from Lincoln Heritage and a membership in FCGS, Mary would have a card in her purse that you’ve given to her. The card has a phone number that can be called 24/7 to activate your funeral plans. Mary just calls the phone number and gives the person your membership number and they start working on Mary’s behalf. Can you see how much easier FCGS makes things?
Without FCGS and immediate payment from Lincoln Heritage, Mary would probably call a local mortuary or funeral home and they would ask her how things will be paid. Mary would have to pay in advance from her own pocket or would be asked to assign the life insurance policy from most other companies (they would tell her they will refund any of the money that isn’t used). But, if the policy is for $10,000, how much do you think the mortuary costs will be?
With FCGS and immediate payment from Lincoln Heritage, Mary would get the lowest prices, would pay with the money from Lincoln Heritage, and could keep any money that is left over. Isn’t that better?
I am currently writing Final Expense policies for Lincoln Heritage. If you would like to take advantage of the Lincoln Heritage advantages mentioned above and get the no cost membership in FCGS, please let me know. If you’d like a quote, give me a call at 714-486-1589 or send an email with your name and phone number and the best time to call to EquityIndexLife@gmail.com.
Let’s face it; we all die someday and somebody is going to pay for the expenses. Isn’t it better to make arrangements in advance?