How to choose a final expense policy

1. Decide how much coverage you need

Add up what you expect your funeral and final bills to cost, then subtract what's already set aside, such as savings, a prepaid plan or the CPP death benefit. The difference is a reasonable starting point.

2. Ask these questions

• Is there a waiting period? What is paid if death happens during it?
• Does the premium stay the same, or does it change as I age? By how much?
• Does the coverage end at a certain age?
• What is excluded?
• What happens if I miss a payment?
• Can I cancel, and is there a free-look period with a full refund?
• Who is the insurer, and is the person selling it licensed in my province?

3. Compare the total cost

Multiply the monthly premium by the number of years you might pay it. For some people, total premiums can end up higher than the benefit, so it's worth checking.

4. Answer health questions accurately

The insurer decides based on your answers. An inaccurate answer can lead to a claim being denied, which defeats the purpose.

Red flags

• Pressure to decide on the spot
• Promises that you're "guaranteed" the lowest price
• Someone who won't name the insurer or show you the policy wording

You can check that an agent is licensed with your provincial insurance regulator, for example FSRA in Ontario.

This guide is general information, not insurance, financial, legal or tax advice.