As Americans age, their financial planning needs can change. The focus may shift from building wealth to protecting their legacy and planning final expenses. Many seniors are preoccupied with the question, “How much do funerals cost?” However, they may be uncertain about how different financial products can address their needs. Two popular options are whole life insurance and final expense insurance. While both offer lifelong coverage and a guaranteed payout, they differ in purpose, cost, and flexibility. Let’s take a closer look to help you decide which one might be a better fit for your needs.
What is whole life insurance?
Whole life insurance is a permanent life insurance policy that provides coverage for your entire lifetime as long as you keep up with the premiums. Insurers usually offer whole life insurance to seniors up to age 85 or 90, though your health and other factors may impact your eligibility.1 Premiums can be determined by your age, health, gender, and desired coverage. Coverage requires comprehensive medical testing and can be flexible based on your needs.
Traditional whole life insurance is designed to provide financial support to your family. Insurance payouts can help loved ones pay off debt or replace lost income. These policies may be a key component of estate planning for policyholders. Whole life policies also have a cash value component that grows over time on a tax-deferred basis. Policyholders can borrow against these policies as needed.
Features of whole life insurance
Let’s explore the features and advantages of traditional whole life insurance policies:
- Lifelong coverage: Your beneficiaries are guaranteed a death benefit as long as premiums are paid.
- Cash value: You can borrow from or even withdraw some of the accumulated cash value during your lifetime.
- Stable premiums: The premiums typically stay the same for the life of the policy.
- Larger death benefits: These policies offer better coverage since they are designed to replace income and support beneficiaries. They also have higher premiums.
- Flexible use of benefits: The death benefit can be used by your family however they choose. Payouts can be used for funeral costs, debts, or ongoing support.
- Medical exam: Some policies involve underwriting and medical tests, which can be a barrier if you have health concerns.
What is final expense insurance?
Final expense insurance is a type of permanent life insurance specifically designed to cover end-of-life costs. Death benefits can go towards funeral expenses, medical bills, and other outstanding debts. Final expense insurance coverage amounts are typically smaller than traditional whole life policies. This makes premiums more reasonable and often more accessible to seniors over 65. Final expense insurance is also less likely to require medical exams.
Features of final expense insurance
Below, we’ve rounded up some important features of final expense insurance:
- Designed for end-of-life costs: These policies are created with funeral and burial expenses in mind. They’re a solution for seniors wanting to ease the financial burden on their loved ones.
- Smaller death benefit: Death benefits usually don’t exceed $50,000.2 While this may be enough to cover funeral costs and memorial expenses, it can’t replace lost income or cover extensive debt.
- Lower premiums: Because the coverage amount is lower, monthly premiums are generally lower as well.
- No medical exam needed: Many final expense policies don’t have a complex underwriting process. Many applicants can qualify without undergoing a medical exam. Note that insurers may differ in underwriting processes.
- Fixed premiums: As with traditional whole life insurance policies, your insurance premiums stay the same throughout the life of your policy.
- Waiting period: Some final expense insurance policies may have a waiting period during which you don’t have coverage. This is an important consideration for policyholders with poor health.
How to choose the right type of life insurance
When choosing between traditional whole life insurance and final expense insurance, you’ll want to consider your coverage needs, whether the premiums would fit your budget, and your overall eligibility. Whole life insurance may make sense for people in good health, who want to leave a larger financial legacy, or are interested in building cash value.
Final expense insurance may be the better choice if you’re focused on covering funeral costs, have a fixed income, or want a policy that’s quick and easy to qualify for without medical exams. Remember to consider the pros and cons of final expense insurance and compare it to other policies or end-of-life financial products before making your decision.
Sources:
1 Experian – When Is It Too Late to Buy Life Insurance? Updated February 21, 2024. https://www.experian.com/blogs/ask-experian/when-is-it-too-late-to-buy-life-insurance/. Accessed June 17, 2025.
2 Investopedia – What Is Final Expense Insurance? Updated April 23, 2025. https://www.investopedia.com/final-expense-insurance-4801018. Accessed June 17, 2025.
Content within this article is provided for general informational purposes and is not provided as tax, legal, health, or financial advice for any person or for any specific situation. Employers, employees, and other individuals should contact their own advisers about their situations. For complete details, including availability and costs of Aflac insurance, please contact your local Aflac agent.
Aflac coverage is underwritten by American Family Life Assurance Company of Columbus. In New York, Aflac coverage is underwritten by American Family Life Assurance Company of New York.
Aflac life plans – A68000 series: Term Life Policies: In Arkansas, Idaho, Oklahoma, Oregon, Texas, Pennsylvania & Virginia, Policies: ICC1368200, ICC1368300, ICC1368400. In Delaware, Policies A68200, A68300 & A68400. In New York, Policies NY68200, NY68300 and NY68400. Whole Life Policies: In Arkansas, Idaho, Oklahoma, Oregon, Texas, Pennsylvania & Virginia, Policies: ICC1368100. In Delaware, Policy A68100. In New York, Policy NYR68100. B60000 series: In Arkansas, Idaho, Oklahoma & Virginia, Policies: ICC18B60C10, ICC18B60100, ICC18B60200, ICC18B60300, & ICC18B60400. Not available in Delaware. Q60000 series/Whole: In Arkansas & Delaware, Policy Q60100M. In Idaho, Policy Q60100MID. In Oklahoma, Policy Q60100MOK. Not available in Virginia. Q60000 series/Term: In Delaware, Policies Q60200CM. In Arkansas, Idaho, Oklahoma, Policies ICC18Q60200C, ICC18Q60300C, ICC18Q60400C. Not available in Virginia.
Coverage may not be available in all states, including but not limited to DE, ID, NJ, NM, NY, VA or VT. Benefits/premium rates may vary based on state and plan levels. Optional riders may be available at an additional cost. Policies and riders may also contain a waiting period. Refer to the exact policy and rider forms for benefit details, definitions, limitations, and exclusions.
Aflac WWHQ | 1932 Wynnton Road | Columbus, GA 31999
Aflac New York | 22 Corporate Woods Boulevard, Suite 2 | Albany, NY 12211
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