final expense insurance is a type of whole life insurance

Final Expense vs. Whole Life Insurance

Final expense and whole life insurance are similar, but there’s a difference that makes them ideal for separate demographics. We will look at what you can do with the death benefit, how to get the most out of your policy and examine how a final expense candidate might not be right for a whole life insurance policy.

They’re Closely Related

Final expense and whole life insurance are similar – join the policy, pay the premiums, and your beneficiaries receive an untaxed death benefit. Both last a lifetime and don’t require renewal.

This is why final expense insurance is considered a type of whole life insurance. But given these similarities, we will see how they are not one in the same.

Different Target Audiences

Final expense focuses on seniors. They’re at the point where they are not just thinking about the money passed onto their loved ones, but how other arrangements will be carried out. The death benefit amount is relatively close to the average funeral cost. Death benefits tend to be between $5,000 and $20,000. Funerals are usually in the neighborhood of $9,000.

Whole life insurance has a broader audience because of how it can be used for when the policyholder is still alive. This type of insurance enables policyholders to have a separate account where money accumulates – this money is referred to as the cash value.

Making Use While You’re Still Alive

Final expense insurance can accrue in value, too. You can make use of it by adding an accelerated death benefit, which gives you a percentage of your death benefit when you’re diagnosed with a terminal illness. You decide how much of the death benefit you want to be accelerated. For instance, you opt to accelerate half of your death benefit. Once you contract a serious illness, you contact your insurance company. They offer a lump sum amount, and you receive that payment, and your premiums are lowered as if your death benefit had been reduced by half.

For whole life insurance, the cash value in the separate account can be borrowed against and paid back. If it isn’t paid back, then that amount is deducted from the death benefit. Your cash value is also invested, but your insurance company decides how it will be invested.


Final expense insurance is less discriminatory, giving an option for those with conditions that would cause other insurance policies to reject them – the guaranteed issue policy. Whole life insurance has no such option.

Whole life insurance is prone to rejecting applicants because as in the world of insurance in general, the insurance company is taking a chance on insuring individuals. If they insure someone with a terminal disease, then they will not be paying premiums long enough in order for the company to release funds and remain profitable.

We Have You Set for Life

At Final Expense Direct, we’re used to helping our customers to be set for life. As our customer, we will help you get a final expense insurance plan that will be worth it. To learn more, call us today at 1-877-674-0236.


Final Expense Direct’s utmost concern is the safety of our clients, their families, and our employees and agents. Our hearts, thoughts, and prayers go out to all that the Coronavirus outbreak has touched and those whose lives have been disrupted. While 98% of our workforce is working remotely, we are here if you need assistance. If you are a client, please contact Customer Support at 800-538-3610, Ext 2, with any questions in regards to your policy. You may also contact us via email at We will continue to monitor this situation and keep you updated.