How life insurance can help with final expenses

5 Important facts to keep in mind

Planning for end of life is never pleasant. But neither is the thought of leaving loved ones with unexpected expenses or debts after you’re gone. In many cases, these financial obligations can hold up the settling of your estate. Consider these five facts about final expenses and how life insurance can help pay for them.

1. Funeral costs are expensive

Funeral costs have been on the rise for as long as there have been funerals. Caskets and cemetery plots are just the beginning. Ceremony fees, transportation, headstones, even clergy donations In 2023, the National Funeral Directors Association calculated that the typical cost of a funeral was $9,995.1

2. Funerals aren't the only final expenses

Funerals may be the most top-of-mind final expense, but many times, they’re not the only one. Household utility bills and outstanding car or home loans may have to be paid. Credit card balances, medical bills and other unplanned financial expenses are also factors that you may have to consider.

3. Final expenses can effect your will planning

You may have created a will or estate plan without considering final expense costs. Only now is it becoming apparent that final expenses can require a lot financially from loved ones. A life insurance policy may make sense and the cash benefit your beneficiary receives can help cover some financial costs left behind such as every day costs or even estate taxes.

4. You may be able to use life insurance funds in advance

There can be many medical costs in the final months or years of life that may not be covered by Medicare or supplemental insurance. If your life insurance is a permanent policy, also known as whole life insurance, that builds cash value over time, you may be able to access this cash value to help pay these bills. Keep in mind, though, that you might end up paying interest on loans you take from your policy, or decreasing the death benefit.

5. No-medical-exam life insurance is available

If you're between the ages of 50 and 80, you may qualify to purchase permanent life insurance with no medical exam. The applications are usually simple. Your acceptance is based on health information you provide or give a life insurance company permission to obtain.

In most cases, your rate will never increase and benefits won’t decrease as long as you pay your premium.

1 National Funeral Directors Association, 2023.



This article is provided by New York Life Insurance Company for informational purposes only. This article is not intended to provide tax, legal or accounting advice. Please consult your own tax or legal advisor for advice specific to your circumstances.