By OLPolicy | Licensed Insurance Specialists | Call (866) 757-5350
When it comes to protecting your loved ones financially, two types of life insurance often come up in the same conversation: final expense insurance and term life insurance. While both provide a death benefit to your beneficiaries, they serve very different purposes-and choosing the wrong one could leave your family under-protected or overpaying for coverage you don’t need.
This comprehensive guide from OLPolicy breaks down everything you need to know about final expense vs. term life insurance-from costs and eligibility to which one fits your age, budget and goals.
| Quick Answer
Final expense insurance is typically best for seniors aged 50–85 who want permanent, affordable coverage for burial and end-of-life costs. Term life insurance is usually better for younger individuals and families who need large coverage amounts to replace income or pay off major debts. |
Final expense insurance-also called burial insurance or funeral insurance-is a type of whole life insurance designed specifically for seniors. It provides a small death benefit, typically between $5,000 and $50,000, intended to cover end-of-life costs such as funeral expenses, medical bills and outstanding debts.
Unlike traditional life insurance, final expense policies are permanent-meaning the coverage does not expire as long as premiums are paid. The premiums are also fixed for life and never increase, regardless of age or health changes after issuance.
| OLPolicy Specialist Tip
If you’ve been denied life insurance before due to health conditions, you may still qualify for a final expense policy. Many carriers offer guaranteed issue options with no health questions at all. Call us at (866) 757-5350 to explore your options. |
The death benefit paid out from a final expense policy can be used for any purpose-there are no restrictions on how your beneficiary spends the funds. Most families use it for:
Term life insurance provides coverage for a specific period of time-typically 10, 20, or 30 years. If the insured person dies during the term, the beneficiaries receive the death benefit. If the policy expires before the insured’s death, the coverage simply ends with no payout.
Term life is generally the most affordable way to get a large amount of life insurance coverage. It’s commonly used by younger adults to protect their families during their highest financial vulnerability years-when mortgages, children’s education costs and income replacement are top priorities.
The death benefit from a term life insurance policy is typically used for larger financial obligations, such as:
Use this table to quickly see how these two types of coverage stack up against each other:
| Feature | Final Expense Insurance | Term Life Insurance |
| Coverage Amount | $5,000 – $50,000 | $100,000 – $2,000,000+ |
| Age at Application | 50 – 85 years old | 18 – 70 years old (varies) |
| Medical Exam Required? | No-simplified issue | Often yes for larger amounts |
| Coverage Duration | Permanent (whole life) | 10, 20, or 30-year terms |
| Premiums Over Time | Fixed-never increase | Fixed during term period |
| Cash Value Accumulation | Yes (small) | No |
| Approval Process | Fast-days to 1 week | Weeks (if medical exam needed) |
| Best For | Seniors covering end-of-life costs | Young families, income replacement |
| Typical Monthly Cost (age 65) | $30 – $100+ | $50 – $150+ (if still available) |
| Coverage After Age 80 | Yes, still available | Usually not available |
Cost is often the deciding factor for many seniors and families. Here’s what you can realistically expect to pay for each type of policy.
Final expense premiums are calculated based on your age, gender, health status and the coverage amount you choose. Because the benefit amounts are small and no medical exam is required, premiums are affordable even for seniors in their 70s and 80s.
Term life premiums are heavily influenced by your age and health at the time of application. Rates are very affordable when you’re young and in good health, but rise sharply with age-and by 65–70, many applicants find term life either unaffordable or completely unavailable.
| Important Consideration
By the time most seniors realize they need coverage for funeral costs, term life insurance has become either very expensive or completely unavailable. Final expense insurance was specifically designed to fill this gap-and OLPolicy specializes in finding the best rates for applicants of all ages and health backgrounds. |
Final expense insurance is the right choice if you identify with any of the following:
Term life insurance is the better fit if you fit the following profile:
Maria is 72, lives on Social Security and her biggest fear is becoming a financial burden to her children when she passes. She has Type 2 diabetes and mild hypertension-conditions that have made traditional life insurance unaffordable.
Best choice: Final expense insurance. Maria qualifies for a $15,000 policy at approximately $85/month, which will comfortably cover her funeral costs without requiring a medical exam. Her premiums are fixed and will never increase.
David and Jennifer just bought their first home and have two young children. David is the primary earner and if he were to pass away, Jennifer would struggle to pay the mortgage and raise the kids on her income alone.
Best choice: Term life insurance. A 20-year, $500,000 term policy on David would cost approximately $30/month-a small price for enormous peace of mind that covers the mortgage, childcare and college costs.
Robert is 58, recently widowed and his children have started their own families. He has some savings but wants to make sure his funeral doesn’t drain his estate. He has COPD and was declined by two carriers.
Best choice: A graded benefit final expense policy or guaranteed issue policy through OLPolicy. While a two-year waiting period may apply, Robert can still get coverage between $10,000 and $25,000 to protect his family. Call (866) 757-5350 to explore options.
Absolutely. Many families-particularly those in the 50–60 age range who still have dependents-choose to carry both types of coverage simultaneously. A term policy handles major financial obligations like a mortgage or income replacement, while a final expense policy guarantees that funeral costs are covered even after the term policy expires.
This layered approach is often recommended by licensed specialists at OLPolicy for clients who want comprehensive peace of mind without overpaying for a single large policy.
Yes-final expense insurance is a type of whole life insurance. The key difference is that it features smaller benefit amounts (typically $5,000–$50,000), no medical exam and it is specifically marketed toward seniors who want to cover end-of-life costs. It operates under the same legal framework as traditional life insurance.
It’s possible but increasingly difficult and expensive. Most insurers cap term life applications at age 65–70 and premiums at this age are often prohibitively high. A final expense policy is usually the more practical and affordable solution for applicants over 65.
When a term policy expires, the coverage simply ends. There is no payout, no cash value and no residual benefit. Some policies offer a conversion option that allows you to convert your term policy to a permanent policy-but conversion deadlines and options vary by carrier. If you’re approaching the end of a term, call OLPolicy at (866) 757-5350 to explore your options.
For seniors who want to ensure their families aren’t burdened with funeral costs, yes-final expense insurance is absolutely worth it. The average funeral in the United States now costs between $7,000 and $12,000 and many families are forced to crowdfund or go into debt to cover these costs when no policy is in place.
Some final expense policies-particularly guaranteed issue policies that require no health questions-include a two-year graded benefit period. During this time, if the insured passes away from a non-accidental cause, the beneficiary receives a return of premiums plus interest rather than the full death benefit. After two years, the full benefit is paid regardless of cause of death. Many final expense policies with simplified underwriting (health questions but no exam) have no waiting period at all.
These terms are used interchangeably in the industry. Both refer to the same type of small whole life insurance policy designed to cover funeral, burial, or cremation costs. Some insurers prefer one term over the other, but there is no meaningful legal or functional distinction between them.
Choosing between final expense insurance and term life insurance doesn’t have to be complicated. At OLPolicy, our licensed specialists take the time to understand your situation, your budget and your goals-then walk you through the best options available from top-rated carriers.
Whether you’re a senior looking for affordable burial coverage or a parent wanting to protect your growing family, we have solutions that fit real life.
| Not Sure Which Policy Is Right for You?
Our licensed insurance specialists at OLPolicy are ready to walk you through your options-no pressure, no jargon. Call us today: (866) 757-5350 |
No pressure. No jargon. Just clear, honest guidance from licensed professionals who put your family first.
OLPolicy | Licensed Insurance Agency | (866) 757-5350 | www.olpolicy.com
This content is for informational purposes only. Coverage availability, rates and terms vary by state and insurer. Contact a licensed agent for personalized advice.
