Differences Among Types of Life Plans
There’s such a variety of plans because each type of insurance helps covers end-of-life expenses in different ways. Your situation and wishes determine which plan will work best to secure your financial future — and your family’s financial future. You’ll want to consider your health, income, and what you want the policy to do. Do you only want to cover your funeral, or are you looking for more comprehensive protection?
To help you decide which plan is best for you, let’s walk through definitions of Pre-need Planning vs. A Final Expense plan
What is a Pre-need Funeral Plan?
A Pre-need Funeral plan is a type of contract that only covers your funeral expenses. It’s purchased through a funeral home, which becomes your contract servicer. You attend a preplanning appointment with your Pre-need counselor, where you choose every element you want included in your funeral service. Pre-need counselor director totals the costs, and that amount is the basis for your Pre-need Funeral plan. Upon your death, the funds are given to the funeral home to pay for your funeral to pay for your funeral.
What is a Final Expense Plan?
A Final Expense Plan is a type of Whole Life Insurance that alleviates the burden on your family by covering funeral costs — and an array of other expenses. Your family can decide how to dispense the money, which can be used for unpaid bills, medical expenses, and even college tuition for children or grandchildren. If they choose to use it for your funeral, they can make arrangements with any funeral home.
Pre-need Funeral Plan vs. Final Expense Plan
Pre-need covers your funeral expenses. Final expense pays funeral costs and bills left behind after your death.
Pre-need holds funeral costs at present day prices. Final Expense does not but it allows your family to work with any funeral home.
Pre-need thoroughly outlines your final wishes. Final Expense leaves decisions to your family.
The Pre-need beneficiary is your funeral home. The Final Expense beneficiary is your primary beneficiary.