CNN underscored recently posted a good article about final expense life insurance.  Death care clients have been contacting us more frequently about this type of policy, and we will share some of their issues.

Funeral homes are backing away from the conventional life insurance policy for some of the same reasons.  Large life insurance companies are often slow to pay policy proceeds, leaving the funeral home waiting for months.   Some insurers would prefer to deal with individuals rather than funeral directors, and require additional documentation.   These additional requirements are frequently made known weeks after the funeral, forcing the funeral director to chase down family members for the requirements.  These issues have led to some funeral directors rejecting insurance policies or charging administrative fees for insurance assignments.

If the consumer intends to purchase a final expense policy for funeral and burial expenses, the following questions should be asked when shopping for a policy:

  1. What are your requirements for proceeds assignments to a funeral home or cemetery?
  2. What is the average waiting period for payment of the policy proceeds?

If you have picked out a funeral home and/or cemetery for your funeral and burial, share the insurer’s responses with them to ensure your family will be able to use the policy without one of the problems discussed above.