PERSONAL FINANCE DFI 201

Last expense insurance

Last expense insurance is a whole life insurance policy that has a small death
benefit and its easier to get approved for, due to a less stricter application
process.
It is also known as funeral insurance or burial insurance.
Smaller policies are sold by insurers in order to make it more affordable.
The death benefits included in the last expense insurance are designed to cover
expenses like funeral services, cremation and a casket or embalming. Last
expense insurance beneficiaries can use the benefit in any way and for any reason
like taking a vacation or paying rent.
The policies are permanent and are available to any applicants with poor health.
The application process is not as strict compared to those of other insurance
premiums. It does not include a medical exam. It only requires a prescription
history and taking a questionnaire.
In some countries, the last expense premiums depend on one's age and gender. It
is said that men have a lower life expectancy than women, and so their premiums
are higher compared to that of women. The last expense insurance does not
expire once you reach a certain age.
Once a policy is acquired, premiums cannot increase and death benefits cannot
decrease.
Last expense insurance can accumulate value that you can borrow. If one dies
before paying the full amount of the loan, the money beneficiaries receive
reduces.
Insurers cannot decrease your policy’s death benefit unless you borrow against
the policy’s cash value or accelerated death benefits.
Death benefits are guaranteed as long as premiums are paid and there is no term
policy. Death benefit is also not taxable.