Although it's hard to start a conversation about death and dying, providing employees with a benefit option that will help them ensure their end-of-life affairs are in order can not only provide peace of mind, but also can keep loved ones from paying a heavy price both emotionally and financially for a funeral they were not prepared to plan.

There are two types of end-of-life insurance for funeral planning - final expense and pre-need, says Mark Duffey, co-founder and president of Houston-based Everest Funeral Package. Final expense insurance is a whole life policy that pays for the funeral and unpaid medical bills, while pre-need insurance is sold by funeral homes and resembles a bill of sale through the home, but is funded through an insurance company.

The main difference between final expense and pre-need is that the beneficiary of the pre-need policy is the funeral home - which can pose a major problem, Duffey believes. Since 85% of funeral homes in the U.S. are independently owned, if the policyholder dies and is buried through another funeral home the policy will not allow all of the money to be returned, just a portion, he says.

Consumers want a clear policy

According to Duffey, people think in "buckets." Meaning, "individuals might have different financial instruments for each of those buckets such as to pay off their home [or] their kids' education," he says, "but funeral planning and end-of-life issues is a bucket out there. [They] want something set aside so they can use it just for funeral expenses."

From an insurance company standpoint, Howard Koransky, vice president of group life for MetLife, shares how the company has aligned its products. Services within a group life portfolio include face-to-face will preparation and estate resolution services through Hyatt Legal Plans, as well as a funeral planning guide and services to help beneficiaries with claims.

A growing need

Between two and three million people a year will buy a final expense life insurance policy, and it's one of the fastest growing areas in life insurance, says Duffey. "More than a million people a year go into funeral homes and buy pre-need [coverage] because they just want it done."

The AARP supports pre-planning for end-of-life needs, but not buying ahead of time. The organization urges consumers to have a plan and financing in place such as a whole life policy or a specialty trust fund from which their family can extract immediately.

With more baby boomers remaining in the workplace and older plan participants enrolling in benefits, end-of-life coverage is going to continue to grow, Duffey says - especially if it's packaged correctly.

Koransky looks at end-of-life coverage from a holistic prospective. In the workplace individuals have a diversity of needs and a broker must help to assess their life insurance needs accordingly, he says.

"By aligning the services [it can] help them through each stage of life. There's no one subscription for any individual," Koransky adds.

Participants have to plan early

End-of-life products and services are something an employee should start thinking about early and holistically. "Will preparation ties nicely with supplemental group life coverage as employees are thinking about life coverage," says Koransky. "The ability to have an individual meet with them face to face to discuss and establish the will we feel really fits nicely."

MetLife offers a service which helps beneficiaries sort through details and questions after a death. It's supported through financial service representatives that help individuals file insurance claims and work with government benefits, while also helping them to sort through documents, locate grief counseling and support services with the beneficiary.

Everest's Duffey says that although brokers may have a hard time talking about death, dying and funeral expenses because it's depressing, it's a must. "This is an issue a broker has, it's not an issue the client has," he adds.

Duffey says most veteran brokers have gotten past the issue and have learned how to engage employees through important information while making a sale. "One of the ways to do that is [for brokers] to just ask [an employee] a scenario," he says.

This could be one where their spouse's life would be at risk and it really makes them think what happens when the unexpected takes place.

Says Duffey: "It's going to happen, so what is your plan?"

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