In today’s article we want to focus on finding the best final expense and burial life insurance quotes and discuss what we feel are some of the most common mistakes made by folks purchasing burial life insurance policies today.
So with that said, let’s first define what we mean by the term “burial insurance or final expense life insurance policy”.
JustBuryMe’s definition of a burial life insurance policy:
A burial insurance or final expense insurance policy is a basic cash value whole life insurance policy that will provide enough coverage to pay for a burial or cremation ceremony.
Pretty simple right?
You see, for us at JustBuryMe, when someone is looking the best burial insurance and final expense life insurance companies, they’re basically looking to get a quote on a policy that will provide enough coverage so that when they die, their family won’t have to worry about how much it’s going to cost to bury them.
You might even ask,
“If burial life insurance policies are so simple, what could possibly go WRONG?”
Comparing Burial Insurance Quotes: Five Pitfalls to Avoid!
It’s true that on the surface the idea of requesting a burial life insurance quote and/or purchasing a burial life insurance policy should be a simple process, but as we all know, usually the “devil is in the details!”
So buyer beware… the most common mistake someone makes when purchasing a burial life insurance policy is that the first look at which company is the CHEAPEST!
For this reason, we’re going to focus first on price first and then we’ll move on to some of the other common mistakes people make when requesting a burial life insurance quote.
Price: if it sounds too good to be true, it PROBABLY is!
Importance of a Fixed Premium
When shopping for life insurance, one of the first questions people ask is:
“How much is burial insurance going to cost?”
After all, price is an important factor, but what many people fail to ask, is the all-important “follow up question”, which is…
“Is this price fixed for the life of the policy, or will it change as I get older?”
You see, there are a lot of really good burial life insurance policies out there, offered by some of the most reputable burial insurance companies that start off with a really low cost, only to have that cost increase every 5 years or so until one day it may become way too expensive for the average fixed income consumer to be able to afford any longer.
Which means, after years and years of paying into a burial life insurance policy, the insured is forced to give up their policy simply because they can’t afford it any longer!
And guess what? These are the same folks who chose these types of policies to begin with because they “thought” they were getting a good deal for their money.
When it comes time to determine which burial life insurance quote is best for you, you’ll need to ask yourself these three important questions:
- What is the price I have to pay to get the policy started today?
- What will be the price for this policy 10 years from now? 20 years from now?
- And is there any possibility that the price of this policy will change between now and the day that you die?
“So let me get this straight, if I die tomorrow my family will get $25,000 but if I die 20 years from now they only get $10,000?”
Importance of a fixed death benefit
We like to keep things simple which is why, in our opinion, a good burial life insurance quote is going to focus on policies that contain fixed benefits
Which means that if you decide to buy a $25,000 burial insurance policy at age 45, you should still have $25,000 burial life insurance policy at:
And age 114!
The last thing you want to learn about 5 years from now (after paying for a policy for 5 years) is that the $25,000 burial life insurance policy that you purchased has some type of “depreciating death benefit” that goes in effect as you age.
Or put another way, what was once worth $25,000 in coverage, is now only worth $20,000 or even $10,000!
This is why when it comes to your burial life insurance coverage amount, you’ll want to ask these 2 questions:
- How much coverage am I purchasing today?
- Will this coverage amount ever change during the life of the policy?
Since I don’t know when I’m going to die, I would prefer that my burial life insurance policy not have an expiration date!
Importance of “No Expiration Date”
Going back to our simple definition of what we consider a true burial life insurance policy:
“A basic cash value whole life insurance policy that will provide enough coverage to pay for a burial or cremation ceremony.”
If you’re like us, you’re probably going to want your burial policy to stay inforce for as long as you live!
Meaning you probably don’t want the policy to expire at age 80 like so many so-called “burial” life insurance policies do!
When it comes time to comparing one burial life insurance quote vs another, an important question you really need to as is:
“Is it possible for me to outlive this burial insurance coverage?”
Graded Death Benefit vs Simplified Issue
Now before we describe what we mean when we compare a Graded Death Benefit policy vs Simplified Issue life insurance policy, we need to first define what a Graded death benefit is so that you’ll fully understand the difference between these two different types of burial life insurance policies.
Graded Death Benefit
The “Graded Death Benefit” is a clause built into most, if not all, guaranteed issue life insurance policies, that states that, should you die within the first two years of owning your life insurance policy (sometimes 3 years depending on which carrier you choose), your life insurance policy will only cover you for accidental causes of death (slip and fall, motor vehicle accident, victim of crime, etc.).
Then after the policy has been inforce for over 2 years (sometimes 3 years depending on which carrier you choose), your policy will then cover you for both accidental and natural causes of death.
Yes, we know we said we were going to keep things simple.
And yes we understand that this “Graded Death Benefit” clause sounds like a terrible idea.
But give us a chance to explain:
You see Graded Death Benefit clauses are typically attached to what are called Guaranteed Issue Life Insurance Policies.
Guaranteed Issue Life Insurance Policies
Guaranteed issue life insurance policies are life insurance policies that are basically going to have 2 requirements for approval.
- You’re going to need to meet the age requirement (typically 45-80 years of age).
- And you’re going to need to be a US citizen.
Now there may be some additional payment type requirements depending on the life insurance carrier (some require a direct deposit, others require check payments, and some may refuse to take cash, etc.). But in general, if you’re a US citizen and you meet the age requirement, you’re approved.
The good news is that these types of policies ARE NOT going to require a medical exam or ask any medical questions.
It’s theoretically possible for you to purchase these types of policies, while literally laying on your death bed!
This is why the insurance companies include a Graded Death Benefit clause so that you’re required to live for at least 2 years before they’ll cover you for natural causes of death.
(Again, remember, they don’t ask any medical questions or any health related questions so the insurance company literally knows nothing about the health of the applicant.)
Now, should you happened to die from an auto accident 20 minutes after purchasing your guaranteed issue life insurance policy—while unexpected and tragic—it will qualify for a full benefit payoff by your insurance company.
Which brings us to why someone may want to buy a life insurance policy that contains a Graded Death Benefit:
If you have a serious pre-existing medical condition that would prevent you from qualifying for any other type of life insurance policy that will either require a medical exam or have medical questions that will disqualify you from being eligible, then a guaranteed issue life insurance policy may be best for you.
I’m pretty healthy, what type of medical questions are we talking about?
Generally speaking, the questions that you’ll likely encounter when applying for a burial life insurance policy that will go inforce immediately and thus not contain a Graded Death Benefit, will look something like this:
- Have you been medically diagnosed as having a life expectancy of 12 months or less?
- In the past 12 months have you:
- Been diagnosed with diabetes, or experienced any severe complications from your diabetes?
- Needed any assistance or personal supervision to perform any activities of daily living.
- Had or been advised to have brain, heart, or circulatory surgery,
- Had chronic respiratory disease such as COPD, emphysema or treated with oxygen.
- Been diagnosed with heart disease or myocardial infraction, leukemia, Hodgkin’s disease, a blood or bleeding disorder, connective tissue disorder, Parkinson’s disease, systemic lupus erythematosus, amyothrophic lateral sclerosis (ALS), cirrhosis, chronic hepatitis B, C or D, liver disease, kidney disease, Alzheimer’s disease, dementia, lymphoma, lymph node enlargement, malignant melanoma, a recipient of an organ transplant, cancer, sleep apnea, etc.
- Has the proposed insured tested positive for HIV?
- Has the proposed insured ever been confined to a psychiatric facility?
Now while answering “Yes” to any one of these questions does not necessarily mean that you’ll be denied coverage, it certainly will complicate the application process.
It may also be the reason why you’ll end up applying for a Guaranteed Issue Life Insurance Policy.
Now some important takeaways:
- Guaranteed issue life insurance policies:
- Will have a Graded Death Benefit.
- Will generally be more expensive.
- And should be considered after all other options have been exhausted.
So important questions you need to ask yourself:
- Does the agent I’m working with offer both types of burial life insurance options, i.e. policies that contain a graded death benefit and those that don’t?
- Has my agent explained why I can’t qualify for a policy that does not contain a graded death benefit?
Our goal at JustBuryMe is to, not only help you get the best possible life insurance policy out there, but also explain to you why the policy that you are choosing to get really is your best option!
A Reputable Company
At the end of the day, you want to make sure that when you do make your final decision, you’re choosing a quality company to place your trust in. Which means that before you make any final decision, shop around a bit!
Now we only work with companies we feel are the most reputable companies out there which is why we rely on both AM Best and Moody’s Life insurance review services to help guide us on who they feel are the most financially stable and reputable companies out there.
AM Best and Moody’s are two of the largest 3rd party review services for the life insurance industry and are largely considered the “Gold Standard” when it comes to reviewing individual insurance companies.
For this reason, we would recommend that once you’ve narrowed down your search, run your choice by AM Best or Moody’s to confirm that they are a quality option, or you could simply ask us!
And there you have it! The 5 pitfalls you need to avoid when comparing burial life insurance quotes.