- Final expense insurance is a small whole life policy — typically $5,000 to $25,000 — designed specifically to cover funeral, burial, and end-of-life costs without a medical exam
- The VA provides a burial allowance of up to $2,000 for service-connected deaths and up to $948 for non-service-connected deaths — far less than the national average funeral cost of roughly $8,000 to $12,000
- Veterans who can no longer qualify for term life insurance due to age or health conditions often find final expense policies the most accessible coverage available — approval is typically based on a few health questions, not an exam
- Premiums are fixed for life and the policy cannot be cancelled for health reasons once issued — making final expense policies predictable for veterans on fixed incomes
- Guaranteed issue policies accept all applicants regardless of health but typically include a 2-year graded benefit period — if the insured dies within 2 years of issue, beneficiaries receive premiums paid plus interest rather than the full face amount
- Veterans eligible for VA life insurance programs (VGLI, S-DVI) should compare those options before purchasing a private final expense policy — VA programs may offer better rates for eligible veterans
- What Is Final Expense Insurance
- VA Burial Benefits — What the VA Already Covers
- Who Needs Final Expense Insurance
- How Final Expense Policies Work
- Simplified Issue vs. Guaranteed Issue
- What Final Expense Insurance Costs
- VA Life Insurance Options to Consider First
- What to Look for When Comparing Policies
- Avoiding Predatory Sales Tactics
- Frequently Asked Questions
Funeral and burial costs catch many families unprepared. The national average cost of a funeral with burial now exceeds $8,000 — and that figure does not include a cemetery plot, monument, obituary, or the many additional costs that accompany end-of-life arrangements. For veterans on fixed incomes who have aged out of affordable term life insurance, final expense insurance fills the gap between what the VA provides and what a funeral actually costs.
This guide explains how final expense insurance works, what the VA already covers through its burial benefit program, when a private final expense policy makes sense for a veteran, and what to watch for when shopping for coverage.
What Is Final Expense Insurance
Final expense insurance — also called burial insurance or funeral insurance — is a type of whole life insurance with a small face amount, typically between $5,000 and $25,000, designed specifically to cover end-of-life costs. Like all whole life insurance, it does not expire as long as premiums are paid, builds a small cash value over time, and pays the face amount to the beneficiary upon the insured’s death.
The defining features that distinguish final expense policies from traditional life insurance:
- No medical exam required — approval is based on answers to a health questionnaire (simplified issue) or with no health questions at all (guaranteed issue)
- Small face amounts — coverage is sized for end-of-life costs, not income replacement
- Fixed premiums — the premium is set at issue and never increases, regardless of age or health changes
- Permanent coverage — the policy cannot be cancelled by the insurer due to health changes after issue
- Fast approval — most policies are approved within days, not weeks
- Simple beneficiary payout — beneficiaries receive a lump sum with no restrictions on how it is used
The death benefit can be used for any purpose — there is no requirement that the funds pay for funeral expenses specifically. Beneficiaries who already have funeral arrangements prepaid can use the proceeds for other needs.
VA Burial Benefits — What the VA Already Covers
Before purchasing a final expense policy, veterans and their families should understand what burial benefits the VA already provides. These benefits reduce — but typically do not eliminate — the out-of-pocket cost of a veteran’s funeral and burial.
VA Burial Allowance
The VA provides a burial allowance to help offset funeral and burial costs for eligible veterans. The amount depends on the circumstances of death:
| Circumstance | 2026 Burial Allowance |
|---|---|
| Service-connected death | $2,000 |
| Non-service-connected death — veteran receiving VA benefits at time of death | $948 burial + $948 interment = $1,896 |
| Death in a VA facility | $948 burial + reasonable transportation costs |
| Veteran receiving VA pension at time of death | Same as non-service-connected above |
The application for burial allowance (VA Form 21P-530EZ) must be filed within 2 years of the veteran’s burial. The person who paid for the funeral — typically a family member — is the one who applies. The VA reimburses the claimant rather than paying the funeral home directly.
National Cemetery Burial
Veterans who qualify for burial in a national cemetery receive the following at no cost to the family:
- Gravesite in a national or state veterans cemetery
- Opening and closing of the grave
- Liner for the casket or urn
- Government-furnished headstone, marker, or medallion
- Perpetual care of the gravesite
What national cemetery burial does not cover: the funeral service itself, the casket or cremation urn, transportation of remains to the cemetery, or any private cemetery costs if the veteran is not buried in a national cemetery. These uncovered costs — which often total $5,000 to $10,000 or more — are what final expense insurance is designed to address.
The Gap Between VA Benefits and Actual Costs
A veteran buried in a national cemetery with a non-service-connected death might receive $1,896 from the VA burial allowance and have the cemetery costs covered — but the funeral home service, preparation of remains, and transportation to the national cemetery can still cost $4,000 to $8,000 out of pocket. A veteran buried in a private cemetery with a non-service-connected death receives only the $1,896 VA allowance toward costs that may total $10,000 to $15,000. Final expense insurance addresses this gap directly.
Who Needs Final Expense Insurance
Final expense insurance is most appropriate for veterans in these situations:
- Older veterans on fixed incomes who do not have sufficient savings to cover funeral costs and whose families would struggle to absorb the expense
- Veterans who no longer qualify for affordable term life insurance due to age or health conditions, but who still have a need for a small amount of coverage
- Veterans who have outlived their VGLI coverage or whose VGLI premiums have become unaffordable at older ages
- Veterans who want to leave a specific amount to cover their final arrangements without burdening family members with the cost
- Veterans with health conditions that preclude traditional underwriting — guaranteed issue final expense policies accept applicants regardless of health history
Final expense insurance is generally not the right tool for younger veterans, veterans with dependents who need income replacement, or veterans who still qualify for affordable term life insurance. For those veterans, a term policy provides far more coverage per dollar of premium.
How Final Expense Policies Work
Final expense policies are whole life contracts. Once issued, they work as follows:
- Premiums are fixed at the rate established when the policy is issued — they do not increase as the insured ages or if health declines
- Coverage is permanent — as long as premiums are paid, the policy remains in force for the insured’s lifetime
- Cash value accumulates slowly over time — the policyholder can borrow against it or surrender the policy for its cash value, though doing so reduces or eliminates the death benefit
- The death benefit is paid tax-free to the designated beneficiary as a lump sum — the beneficiary can use it for any purpose
- No expiration date — unlike term insurance, a whole life policy does not expire after a set number of years
Simplified Issue vs. Guaranteed Issue
Final expense policies fall into two underwriting categories, and the difference matters significantly for veterans with serious health conditions.
Simplified Issue
Simplified issue policies require answers to a short health questionnaire — typically 10 to 20 yes/no questions about serious conditions such as cancer, heart disease, HIV, kidney dialysis, recent hospitalizations, and terminal illness. No medical exam is required. Applicants who answer no to all disqualifying questions are approved, usually within days.
Simplified issue policies offer immediate full coverage from the policy effective date — there is no waiting period. The premium is lower than guaranteed issue for applicants who qualify. Most veterans with controlled chronic conditions (diabetes, hypertension, COPD) qualify for simplified issue; those with recent serious diagnoses or terminal conditions may not.
Guaranteed Issue
Guaranteed issue policies ask no health questions and cannot decline any applicant within the eligible age range (typically 45 to 85). Every applicant is accepted regardless of health history, current conditions, or medications. The trade-offs are higher premiums and a graded benefit period.
The graded benefit period — typically 2 years — means that if the insured dies from natural causes within 2 years of the policy issue date, the beneficiary receives the premiums paid plus interest (often 10%) rather than the full face amount. Death from accidental causes typically pays the full face amount from day one. After the graded period ends, the full death benefit applies regardless of cause of death.
Guaranteed issue is the appropriate choice for veterans who cannot qualify for simplified issue due to serious health conditions and who need some coverage in place. It is not the right choice for veterans who can qualify for simplified issue — the lower premiums and immediate full coverage of simplified issue are clearly superior for eligible applicants.
What Final Expense Insurance Costs
Premiums vary by age, sex, health classification, and face amount. The table below shows approximate monthly premiums for a $10,000 simplified issue final expense policy for male applicants in standard health — actual quotes will vary by insurer and state:
| Age at Issue | Approximate Monthly Premium — $10,000 Policy | Approximate Monthly Premium — $20,000 Policy |
|---|---|---|
| 60 | $35–$45 | $65–$85 |
| 65 | $42–$55 | $80–$105 |
| 70 | $55–$70 | $105–$135 |
| 75 | $72–$92 | $140–$180 |
| 80 | $95–$120 | $185–$235 |
Female applicants generally pay 20–30% less than male applicants at the same age due to longer life expectancy. Guaranteed issue policies run 20–40% higher than simplified issue at the same face amount. Premiums are locked at issue and never increase — a veteran who purchases at 65 at $55 per month pays $55 per month at 85.
VA Life Insurance Options to Consider First
Before purchasing a private final expense policy, veterans should evaluate whether any VA life insurance programs are available to them — VA programs may offer better rates or more coverage for eligible veterans.
VGLI (Veterans’ Group Life Insurance)
VGLI is available to veterans who had SGLI coverage and separated within the last 240 days, or who converted from SGLI within the standard window. Coverage is available up to $500,000 in $10,000 increments, and VGLI can be increased in $25,000 increments every 5 years on the veteran’s birthday without a health statement until age 60. VGLI premiums are age-based and increase at 5-year intervals — at older ages, VGLI premiums can become significantly more expensive than private final expense policies for the same face amount. Veterans in their 70s and 80s with VGLI may find that reducing VGLI coverage to the minimum and adding a final expense policy produces better overall value. For a full breakdown of VGLI rates and how they compare to private options, see the VGLI vs. Private Life Insurance Guide.
S-DVI (Service-Disabled Veterans’ Insurance)
S-DVI, also known as RH Insurance, provides up to $10,000 of life insurance to veterans who received a new service-connected disability rating on or after April 25, 1951 — and who apply within 2 years of that rating. Veterans with a total disability rating may also be eligible for a premium waiver. S-DVI premiums are based on age at application and are generally competitive with private final expense rates for smaller face amounts. Veterans who qualify for S-DVI and have not yet applied should do so — coverage is limited to $10,000 but the VA underwriting is favorable and the premium waiver for totally disabled veterans makes it effectively free coverage for qualifying veterans. Apply through the VA’s life insurance portal.
What to Look for When Comparing Policies
Not all final expense policies are equal. When comparing options, evaluate each of these factors:
Financial Strength of the Insurer
A life insurance policy is only as good as the insurer’s ability to pay claims — potentially decades after the policy is issued. Check the insurer’s AM Best rating before purchasing. AM Best ratings of A- or better indicate financial stability sufficient to support long-term obligations. Avoid insurers with ratings below B+ or those without an AM Best rating.
Graded Benefit Period
Confirm whether the policy has a graded benefit period and exactly what is paid during that period. Standard graded benefit terms return premiums plus 10% interest for natural-cause death in years one and two. Some policies pay a percentage of the face amount instead — 25% in year one, 50% in year two, 100% in year three. The latter structure may be more advantageous depending on the face amount and premium level. Simplified issue policies typically have no graded period — confirm this when comparing.
Exclusions
Final expense policies are simple but not exclusion-free. Most policies exclude suicide within the first 2 years of issue. Some policies exclude death resulting from specific activities or drug/alcohol-related causes. Read the exclusion section of any policy before purchasing and confirm the policy pays for natural causes of death with no graded period (simplified issue) or a clearly defined graded period (guaranteed issue).
Funeral Home Assignment Option
Some final expense policies allow the beneficiary to assign the death benefit directly to a funeral home as payment — simplifying the financial process at the time of death and ensuring the funds go directly to the intended purpose. This is a convenience feature, not a requirement, and the absence of it does not make a policy inferior. Beneficiaries always retain the right to use the proceeds for any purpose.
Avoiding Predatory Sales Tactics
Final expense insurance is one of the most heavily marketed products to older veterans, and the marketing environment includes aggressive and sometimes deceptive practices. Common tactics to recognize and avoid:
- “No one can be turned down” — this phrase indicates a guaranteed issue product, which is legitimate, but the marketing often obscures the graded benefit period. Any policy that accepts all applicants without health questions will have a waiting period for natural-cause death — demand the full policy terms in writing before purchasing
- Mailers designed to look like government documents — official-looking envelopes with seals, government-adjacent language, and urgent deadlines are common in final expense direct mail. No government agency sells final expense insurance by mail
- Pressure to decide immediately — legitimate insurance can be purchased at any time. Any agent or company that pressures a veteran to decide on the spot or forfeit a “limited time offer” should be avoided
- Policies sold by unlicensed agents — verify that any agent selling insurance is licensed in your state. State insurance department websites allow consumers to verify agent licenses at no cost
- Excessive face amounts for the purpose — an agent selling a $50,000 final expense policy to an 80-year-old veteran with no dependents is almost certainly generating commission income rather than serving the veteran’s actual needs. Final expense coverage sized to actual end-of-life costs — typically $10,000 to $25,000 — is appropriate; larger amounts at final expense premiums are expensive coverage that may not serve the veteran’s goals
Veterans who feel they have been misled or subject to deceptive sales practices can file a complaint with their state insurance department. The National Association of Insurance Commissioners (NAIC) maintains a directory of state insurance departments at naic.org.
Frequently Asked Questions
Yes, through guaranteed issue policies. Guaranteed issue final expense insurance accepts all applicants within the eligible age range regardless of health history, current diagnoses, or medications. The trade-off is a 2-year graded benefit period for natural-cause death, during which the beneficiary receives premiums paid plus interest rather than the full face amount. After the graded period, the full benefit pays for any cause of death. Veterans with conditions such as cancer, heart failure, COPD on oxygen, or recent strokes who cannot qualify for simplified issue should look specifically at guaranteed issue policies from financially strong insurers.
No — they are different tools with different risks and benefits. Pre-paying a funeral (through a funeral home’s pre-need plan) locks in today’s prices for specific services at a specific funeral home. The funds are typically held in a state-regulated trust. Final expense insurance pays a death benefit to a beneficiary who then arranges and pays for the funeral — prices at the time of death apply. Pre-need plans lock in pricing but tie the arrangement to a specific funeral home that may change ownership, move, or close. Final expense insurance provides flexibility but does not lock in pricing. Some veterans choose both — a final expense policy for flexibility and a pre-need plan to lock in the specific arrangements they want.
No. VA disability compensation does not affect eligibility for private final expense insurance. The insurer evaluates the applicant’s health status, not their VA benefit income. A veteran receiving 100% P&T disability compensation applies for final expense coverage under the same process as any other applicant — their disability rating is not a factor. The disability rating may reflect health conditions that are relevant to simplified issue underwriting (answering health questions), but the compensation income itself has no bearing on eligibility or premiums.
If premiums lapse, the policy enters a grace period — typically 30 days — during which coverage remains in force and the veteran can pay the overdue premium to reinstate the policy without penalty. If the grace period passes without payment, the policy lapses. At that point, the insurer may apply any accumulated cash value to extend coverage for a period (automatic premium loan feature, if included in the policy) or convert the policy to a reduced paid-up policy with a lower face amount and no further premiums required. The specific options depend on the policy terms. Veterans on fixed incomes should set up automatic bank draft payments to prevent accidental lapses.
Yes. Final expense policies allow any person, organization, trust, or charity as a beneficiary — there is no restriction to family members. A veteran who wishes to direct the death benefit to a veterans’ charity, a church, or any other organization can do so by naming that entity on the beneficiary designation form. Veterans who name a non-person as beneficiary should confirm that the organization’s legal name and tax ID are correctly listed on the beneficiary form, and should notify the organization that they are named as beneficiary so the claim can be filed promptly after the veteran’s death.
Related Guides
- SGLI Complete Guide — life insurance coverage during active duty and what happens at separation
- VGLI vs. Private Life Insurance — comparing your options after leaving the military
- Surviving Spouse VA Benefits — the full range of benefits available to a surviving spouse beyond life insurance
- Lesser-Known VA Benefits — other programs veterans often miss, including burial benefits
This article is provided by MilitaryBenefitGuide.com, an independent educational resource. We are not affiliated with the Department of Veterans Affairs, Department of Defense, or any government agency. For official benefit information, please visit VA.gov or contact your local VA office.