our team explains how burial insurance works

How Does Burial Insurance Work?

You’ve heard of final expense/funeral/burial insurance, but how does it work, exactly? The team at Final Expense Direct has you covered. Today, we explain how it works, as well as some important things to know. 

How Does Final Expense Insurance Work?

Generally, burial and funeral insurance policies don’t require a medical exam. The application might ask you just a few health questions, or no questions at all. The rates are based mainly on gender and age. Funeral insurance is usually one of these two types of whole life insurance:   

  • Simplified issue life insurance: This application has no medical exam and only some health questions. But answering “yes” to any of the questions could disqualify you. For example, applications usually ask if you’re living in a nursing home or if you currently have HIV.
  • Guaranteed issue life insurance: There’s no medical exam and no health questions when you apply for guaranteed issue life insurance. You can’t be denied. 

The drawback of these easy applications is that the policy will typically have “graded death benefits.” If you pass away within two or three years after purchasing the policy, your beneficiaries will get only a refund of the premiums you paid (plus some interest), or a small portion of the policy’s coverage amount. But accidental deaths, like in a plane crash, are normally covered in full from the start of the policy.

What Else Should I Know?

Final expense insurance lets you choose your beneficiary, and the benefit goes straight to him or her. The beneficiary, usually a partner or relative, will make sure that instructions are followed and funds are properly dispersed. 

Here are some other things you should know about final expense insurance:

  • It’s available to folks in poor health with graded benefits. This means only a share of the policy will be accessible for the first few years of coverage. 
  • Additional benefits may be awarded if there’s an accidental death.
  • The value of this kind of policy can increase over time. It functions like a savings account, with the balance rising as you pay in.
  • The older you are, the higher your initial premium will be. However, your premium’s amount will not increase as you age.  
  • The specific final arrangements remain flexible, although you provide instructions.
  • You have flexibility when you choose service providers. So, you can allot funds without being bound to a certain provider, plan, or geographic area. Final expense insurance keeps your options open. The timeframe from when you choose a policy to when you use a policy can be lengthy, so this flexibility is a tremendous advantage.  
  • A $10,000 policy costs roughly $2 per day.
  • Many people think that final expense only covers burial costs, but this is not the case. The insurance can cover a multitude of expenses, which allows your family to use the benefits for whatever they need to pay. The coverage includes common final costs, like probate or legal fees, medical bills, and any debt.  
  • You may borrow against the tax-deferred value of your policy. Besides preparing for your family’s future, you’ll also have an available line of credit in case of an emergency.

For all your final expense questions, call 1 (877) 674-0236 or contact us online.


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 customerservice@finalexpensedirect.com. We will continue to monitor this situation and keep you updated.