How much final expense coverage is right for your client? There's no right answer to this question. It truly varies on a case-by-case basis. It is always possible that what your client needs is out of their reach financially, but the good news is that almost everyone qualifies for final expense coverage.
Unfortunately, funerals are time-sensitive events. Your client's family will have to handle finances and funeral plans in a short amount of time. This is almost impossible to do without sufficient funds. Your client's loved ones want to honor their wishes, but this is hard to do without the means to cover the expenses.
Ask Yourself These Two Questions When Selling Final Expense
There are two things to take into consideration when buying final expense. How much is your client able to pay on a monthly basis and how much can your client's loved ones cover, if any? This is an important conversation your client may need to have with their loved ones. Bringing
their loved ones or anyone who helps them make decisions to the appointment would be a good idea. We know it is a difficult conversation to have, but it will be worthwhile.
Final expense plans typically range from $2,000 to $25,000 depending on the carrier. The level of plan your client purchases will affect how much your client's monthly premiums are. The amount your client needs depends on their funeral wishes, any debts they have, and how much support their family needs after they pass.
While final expense plans can be used to pay for anything, the most common use is for funeral expenses. Most funeral providers have a basic service fee which is typically around $2,000. On top of that, expenses include transporting the remains, the viewing and burial, the casket, the vault, facilities and staff, and any other services your client requests. All of these costs can add up to around $10,000.
"More often than not, agents sell final expense plans with only commissions in mind, not their client. This comes back to haunt them when their client stops paying their premiums and they lose their commissions."
- Ronnie James
What Works Best for Your Client's Wallet?
Final expense is a sensitive topic, so it is important to have a strong agent-client relationship. It must be a judgement-free environment. It can be difficult to talk about expenses, especially when a large portion of individuals who buy final expense plans are on a fixed income where it is difficult to add extra monthly expenses.
More often than not, agents sell final expense plans with only commissions in mind, not their client. This comes back to haunt them when their client stops paying their premiums and they lose their commissions. It is important to keep in touch with your client in order to make sure this plan is still working for both of you. Your client will appreciate your concern and they will also be more likely to offer referrals.
Is It the Right Time to Purchase a Policy?
Another important thing to consider is when to buy a final expense plan. The older your clients get, the higher your client's monthly premium will be. However, once your clients purchase a final expense plan, the premium is locked in. The amount your client pays per month is determined based on gender, age, tobacco use, and the amount of coverage they want.
The average monthly premium costs for $10,000 dollars of coverage range from $25 to $152 for a female and $30 to $190 for a male per month depending on age. It is important to plan ahead because the older your client gets, the less options they will have, and the monthly premiums will be more expensive.
Everyone's premium will be different, so there isn't one straight answer for how much final expense coverage your client needs. However, it is important that they are aware of their situation and realize how much coverage they can afford. Remember that even if the client can't afford to cover the total need, any coverage is better than no coverage.
More Final Expense Resources
Read more about final expense coverage by checking out our other blog posts on selling final expense to your current book of business and final expense for veterans. Stop by our final expense corner for an in-depth look at this type of insurance. If you have any questions, feel free to give us a call at 888-622-9122. Our expert agent support team is always happy to help.