How Much Does Final Expense Insurance Cost? What Drives the Price

Key takeaways

• Final expense insurance is a smaller life insurance policy meant to cover funeral costs, medical bills and other final costs.
• What final expense insurance costs depends mostly on your age, your health, the amount of coverage and whether the policy asks health questions.
• Policies with no health questions usually cost more and may pay a reduced benefit in the early years.

If you're asking how much final expense insurance costs, the honest answer is that it depends on you. Your age, your health, how much coverage you want and the type of policy all change the price. This guide walks through each of those factors so you know what to expect before you get a quote. It also shows what a funeral actually costs, so you can pick a coverage amount that fits.

What final expense insurance is

Final expense insurance (sometimes called burial insurance) is life insurance with a smaller death benefit. It's designed to help your family pay for your funeral, burial or cremation, and other bills that come up at the end of life.

Like any life insurance, it pays your beneficiary when you die. Your family can use the money however they need: funeral costs, medical bills, credit cards or anything else. According to the IRS, life insurance proceeds paid to a beneficiary because of a death generally aren't counted as taxable income.

What a funeral costs today

To choose a coverage amount, it helps to know what a funeral costs. The National Funeral Directors Association (NFDA) publishes a national study of funeral home prices. In its 2023 General Price List Study, the most recent it has released:

These are median costs. Half of funerals cost more and half cost less. NFDA also notes that costs vary by region.

Just as important is what these numbers leave out. The burial figure doesn't include a cemetery plot, a monument or grave marker, or cash-advance items like flowers or an obituary. If you plan to be buried, the full bill will likely be higher than the median shown.

Cremation is now the more common choice. NFDA projected a U.S. cremation rate of 63.4% for 2025, compared with 31.6% for burial.

What drives final expense insurance cost

Every insurance company sets its own rates. But the same few factors shape the price everywhere.

Your age

Age is one of the main inputs. As the NAIC points out, the risk of death rises each year, so the same coverage generally costs more the older you are when you buy it.

Your health

Unless you choose a guaranteed issue policy, you'll answer health questions. The NAIC notes that changes in your health can affect your ability to get a policy and the premium you'll pay. Being honest on the application matters. The NAIC warns that if an insurer finds false statements after it issues your policy, it could reduce or cancel your coverage.

How much coverage you buy

More coverage costs more. Start with what you want the policy to pay for: a burial or a cremation, a cemetery plot, a headstone, any medical bills or debts. Then subtract any savings your family could use. That gives you a coverage amount that fits your plans instead of a guess.

Simplified issue vs. guaranteed issue

This choice has the biggest effect on price and on how the policy pays.

• Simplified issue policies ask health questions on the application. Whether the policy is issued can depend on your answers.
• Guaranteed issue policies don't ask about your health. If you're in the age range the company accepts, you can get coverage.

That access comes at a cost. The NAIC's buyer's guide says a policy that doesn't require detailed health information will usually cost more and provide less coverage than one that does. In general, if you can qualify for a simplified issue policy, compare it before choosing guaranteed issue.

Graded benefits and waiting periods

According to the NAIC, many small burial-type policies are sold with simplified underwriting or on a guaranteed issue basis with lower death benefits in the early policy years. This is called a graded or modified death benefit. That means the policy pays a reduced benefit if you die during the first years. For some policies, the early-year benefit is a return of the premiums you paid, with or without interest. After that period, the full benefit applies.

The length of the reduced-benefit period and how it works are different from policy to policy. NAIC model rules require ads for these policies to clearly show any limits and the minimum death benefit. Before you buy, ask:

• How long is the reduced-benefit period?
• What does the policy pay if I die during that time?
• Are any causes of death, like accidents, paid in full from the start?

How to keep final expense insurance affordable

• Buy the amount you actually need. Price out the funeral you want and build from there.
• Answer the health questions. If you can qualify for a policy that asks about your health, it may cost less and offer more coverage than one that doesn't.
• Compare more than one carrier. Each company sets its own prices and rules, so quotes for the same person can differ.
• Make sure you can keep paying. The NAIC suggests asking whether the premium can go up later and what the highest premium could be.
• Use the review period. Most policies let you return them for a full refund within a short window after you receive them, usually about 10 days. The exact window is usually stated on the first page of the policy.

Final expense vs. other life insurance

Final expense is one option among several. If you also want to replace income or pay off a mortgage, a larger term or permanent policy may fit better. See how the main types compare in our guide to term vs. whole life insurance, or start on our life insurance page.

The bottom line

Final expense insurance cost isn't one number. It's set by your age, your health, the amount you choose and whether the policy asks health questions. Knowing the median cost of a funeral, and what that number leaves out, helps you pick a sensible amount.

A licensed agent can compare simplified issue and guaranteed issue options from several carriers and explain any waiting period before you sign.