How To Buy Final Expense Insurance For Your Parents

Learn what’s required, how final expense policies work, the cost, and how to get no waiting period coverage.

The Requirements For Buying Burial Insurance For Your Parents

Buying life insurance for a parent is allowed by most final expense insurance companies. The requirements are generally:

• They agree to the policy being issued.
• They answer the health questions unless you’re applying for a guaranteed acceptance policy (no health questions).
• They sign the application (there are various ways to sign).

Those requirements cannot be waived under any circumstances.

If your mom or dad is unwilling to participate in the application process, there is no way to insure them. Check into a pre-paid burial directly with a funeral home if they won’t let you buy life insurance coverage for them.

Buying life insurance for someone else generally requires an “insurable interest.” Insurable interest is when you, the beneficiary, would endure a financial setback due to the insured’s death (your parents). Fortunately, your parent’s final expenses will satisfy the insurable interest requirement.

So when buying final expense insurance for your parents, no insurance company will ask you why you want the policy or require you to provide documents proving you have insurable interest.

It would be best if you were the owner

Ideally, you should be the owner, payor, and beneficiary (unless you want someone else to be). That way, you’re the only one who can inquire about the policy or make changes to it.

With a life insurance policy, there are generally four parties:

• Insured (your parents)
• Owner (the person in control of the policy and owns any cash value that has accumulated)
• Beneficiaries (to whom the death benefit is paid to upon the passing of the insured)
• Payor (whomever pays the premiums)

Ownership establishment can be done in the application or transferred after the policy has been issued.

Be very wary of buying funeral insurance online because online applications are not meant to be submitted by anyone other than the insured.

If you use those online forms from companies such as AAA or Colonial Penn, the insured (your parent) is automatically the owner. You’d be paying for a policy and have no control over it. To make any inquires or changes to the policy (even to cancel it), the insurance company would only speak to your parent, and only they could execute changes.

How Does Burial Life Insurance Work?

Burial insurance for seniors is a small whole life insurance policy meant to pay for all funeral expenses. It provides immediate peace of mind knowing that family members won’t be stuck with the financial burden of unpaid end-of-life costs. Upon your parent’s death, the insurance company will give a tax-free check directly to you or your loved ones so they can pay for their final expenses.

Technically, the payout money can be used for anything, such as funeral services, medical bills, credit card or other outstanding debts, or anything else. Any money left over stays with the beneficiary(s).

The monthly premiums are affordable, medical exams aren’t required, and the underwriting is very lenient so that people with health issues still qualify. Most companies will offer coverage from $2,000-$50,000 and are available from ages 18-90.

Some burial policies have health questions, and some do not. Both options have their pros and cons, so it’s essential to understand the differences.

First, plans with health questions generally cost less and have no waiting period (if you’re approved). On the other hand, plans without health questions (aka guaranteed acceptance life insurance) will not deny you because of pre-existing health conditions.

The guaranteed approval provision does come with drawbacks. They are more expensive since the insurer takes on much risk knowing nothing about your health. Also, they have a two-year waiting period. The insurer will only refund your premiums if you die during the waiting period for any non-accidental death.

The payments on a burial insurance policy will never increase, the death benefit won’t decrease, and it will never terminate due to age. Additionally, they build cash value that the policy owner can withdraw and use as they see fit.

It’s important to remember that you will also hear “burial insurance,” commonly referred to as “final expense insurance” or “funeral insurance.” All three of these terms have the same meaning.

How Much Does Final Expense Insurance For A Parent Cost?

The cost of final expense insurance for parents is usually between $50-$100 monthly for a $10,000 death benefit.

Remember, life insurance rates for your parents are based on exact age, gender, health, tobacco usage, state of residence, and the amount of coverage you want.

Age is the most significant factor that determines the price. Life insurance for seniors over 70 costs nearly double what it does in your 60s.

Like the one below, a whole life rates chart by age is an excellent way to estimate how much final expense insurance costs.

Funeral Insurance For Parents Over 80

Buying funeral insurance for parents over 80 isn’t any different than for other ages. Granted, the options at this age are limited, but it can still be done (even after 85).

Below are some of the best companies that offer life insurance for seniors over 80. Please note that these providers may only be available in some states. For example, these companies (except Transamerica) don’t offer coverage in New York.

Insurance Company	Coverage Options Above 75	Max Age For New Applicants	Policy Type	When Policy Can Pay Out
	$2,000-$40,000	85	Whole Life Insurance	No waiting period
	$1,000-$30,000*	85	Whole Life Insurance	No waiting period
	$2,000-$25,000	89	Whole Life Insurance	No waiting period
	$2,500-$25,000	89	Whole Life Insurance	No waiting period
	$2,500-$15,000*	90	Whole Life Insurance	No waiting period
	$2,000-$20,000*	90	Whole Life Insurance	Refund of premiums in first 12 months, 50% payout in 2nd year, then full benefits after 2 years
*Maximum coverage varies by age

How To Find The Best Funeral Policy For Parents

Whether you want life insurance for parents or grandparents, it’s vitally important to compare various policies side by side to find the best burial insurance plan. That’s because each company’s final expense policies vary significantly in price, underwriting, and waiting periods.

The best thing you can do is to work with an independent agency like Choice Mutual. Independent agencies represent multiple insurance providers rather than just one. An agency’s job is to analyze each carrier to find the best life insurance option without granting favor to one company or another.

In contrast, captive insurance companies do not allow their insurance agents to represent other providers. For example, State Farm is a captive life insurance company. Their agents can only offer State Farm. If you don’t like State Farm’s offer, the agent cannot recommend another insurer that might give you a better deal.

Remember, when you buy through a broker like Choice Mutual, there is never a cost, fee, or upcharge to the insurance. An independent agency will answer all your questions and find you the best, least expensive policy possible.

If you’re trying to purchase burial insurance for a parent, call us at 1-800-644-2926.

We partner with over 15 different insurance companies. We’ll find you the best price possible and hold your hand throughout the process.

How Much Does A Funeral Cost?

The cost of a funeral varies greatly depending on your preferences. According to the NFDA, the average funeral (with a burial, viewing, and vault) costs about $9,420. Cremation is less expensive, but not a significant amount. The average cost of cremation is $6,970.

But you can save considerable money if you opt for direct burial or direct cremation. A direct funeral has no memorial services of any kind. The average direct burial costs $2,597, and the average direct cremation costs $2,183.

Shopping around saves you a lot of money on burial expenses. For example, call multiple cemeteries to see which has the least expensive burial plot. Also, you can buy caskets online from companies like Costco. Just know that you don’t have to accept what the funeral home initially offers you.

Frequently Asked Questions