Who Should Consider Buying Whole Life Insurance?
Since whole life insurance premiums are relatively expensive, it is wise to consider it only if you have enough money to buy a policy with an adequate face value.
The younger you are when you buy your policy, the lower your premiums will be, so it may be a good choice if you are very young and healthy.
Whole life insurance can also be a good estate-planning tool for older people and a good choice for individuals who want the security of knowing that their policy will not expire and that they will never have to reapply for life insurance. This can be important if you are concerned that your health may make you uninsurable in the future.
Features & Benefits
Protection for life
Payments that stay the same each year
To be able to put additional money into the policy on a tax-favored basis
Cash value you can use while you are living
The goal in purchasing this form of life insurance is that the people you list as beneficiaries of the policy will use the proceeds from a death benefit to pay for your burial, final medical costs and funeral costs. It is not a policy that has a design to provide your family with thousands and thousands of dollars to live off. This is why it is so important for those that are older. Seniors will benefit from these policies because of the lower face value of them. They are just enough to pay immediate costs.
With this reduced face value comes an additional benefit that most seniors will appreciate. That is a lower cost. Most policies require much smaller premiums, which means that you can make affordable monthly payments to obtain and keep this insurance. This is considerably different from larger, traditional life insurance policies where the premiums are expensive.
Although the policy is called "final expense insurance," it is no different than a traditional life insurance policy with a small monetary value.
Final expense insurance allows the named insured to feel safe knowing that funeral-related expenses are covered regardless of the statutes of their estate at the time of death.