The world population is increasing at a rate of over 1% a year and climbing steadily with projections of reaching 90 million by the year 2050. As a consequence of this, more births than deaths mean that the population is aging ? a phenomenon that is particularly noticeable in more economically developed countries.

When it comes to life insurance, an aging population means that an increasing number of older people are without cover at a time when it seems most important to have it ? and, consequently, companies are beginning to offer specialist policies for these prospective customers.

Final expense insurance is one type of policy that is increasingly being offered to older people. It is generally accepted (and endorsed by companies offering traditional life insurance) that the younger you are when you apply, then the cheaper your policy will be. Although this is great for young people, it does mean that older people tend to get a raw deal if they have not yet purchased life insurance by retirement age. Therefore, final expense insurance is an alternative to standard policies ? and is aimed at older people only.

As might be expected, final expense insurance policies might come with their own stipulations or suggestions as to how the payout must be spent. Subsequently, the payout from final expense insurance policies is usually used to pay for funeral expenses, such as hearse hire, wake costs, and travel for friends and family members. Final expense life insurance can be purchased at a small face value cost and premiums remain level until payout ? additionally, unlike term life insurance they do not expire after a certain time.

Whilst some final expense policies might offer cover immediately, many policies also give a vesting period instead of health questions as associated for regular life insurance. If the insured person lives longer than this waiting period then the beneficiaries receive the full face value of the payout. However if they do not, they will receive their premiums with an interest rate negotiated at the outset.

Another option for senior citizens (although offered to people of any age) are preneed or prepaid insurance policies. These are purchased specifically for funeral expenses. At the time the policy is applied for, the insured will sign an agreement with a chosen funeral home ? which will receive most of the payout once the claim is made.

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