Final Expense Sales Increase: Demand Rises Among Seniors

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Author

Nancy Moussa, ALMI
Associate Research Director Insurance Product Research
LIMRA and LOMA

September 2025

The final expense insurance market experienced robust growth in 2024, as reported in the latest LIMRA/Life Insurance Council (LIC) Final Expense Survey. With 28 participating companies reporting a combined $1.046 billion in annualized premium and over 1 million policies issued, the sector continues to demonstrate resilience and relevance in serving the needs of lower-income seniors seeking coverage for end-of-life expenses. “Final expense addresses the insurance needs of some of America’s most vulnerable and underserved people — including low-income seniors,” according to Karen Terry, corporate vice president, insurance research at LIMRA and LOMA.

Strong Year-Over-Year Growth

The final expense market saw a 16 percent increase in new premiums from 2023 to 2024, rising from $900 million to over $1.045 billion. The number of policies issued also grew by 10 percent, from 966,377 to 1,060,947. The average annual premium per policy increased by 6 percent, reaching $986. These gains reflect the importance of this product to consumers. Carriers report that they have 7.7 million final expense policies in force – nearly 1 for every 10 consumers age 60 and older.

Figure 1

	2023	2024	Companies	Percent Change
Sales by Premium	$900,256,255	$1,045,591,394	28	+16.14%
Policies Issued	966,377	1,060,947	28	+9.79%
Average Premium per Policy	$932	$986	28	+5.79%

Independent Distribution Dominates

Independent agents and brokers continue to be the backbone of final expense sales, accounting for nearly 90 percent of total premium. Affiliated agents contributed 7 percent, while direct-to-consumer channels made up just 4 percent. This distribution pattern underscores the importance of personal relationships and agent-driven sales in this market, particularly when serving older clients who may prefer face-to-face or phone-based interactions.

The average premium and policy size are low for these products, regardless of channel, as they are designed to provide affordable coverage to cover basic final expense costs.

Simplified Issue Policies

With an older consumer in mind, final expense policies are designed to be easy to apply for and accessible to those who may have age-related medical issues. Simplified issue policies, which require minimal underwriting and no medical exams, made up 85 percent of total premium sales. Guaranteed issue policies, which are issued without any health questions, accounted for the remainder. The average face amount for simplified issue policies was $14,535, compared to $9,786 for guaranteed issue.

This preference for simplified underwriting reflects the market’s focus on accessibility and speed. Many companies now offer point-of-sale decisions using prescription drug databases and identity verification tools, streamlining the application process for both agents and consumers. Unlike the overall life market, most carriers turn these policies around for issue within two or fewer business days.

Policy Type Preferences and Placement Ratios

Benefits paid vary among final expense policies. Full death benefit policies, which pay out the full face amount without conditions, were the most common, representing 72 percent of total premium. Other types, which limit the payout for the first two years, hold a smaller share. Limited or modified death benefit policies, which return the premium paid during the first two years after issue, accounted for 17 percent. Graded death benefit policies, which initially pay a percentage of the face amount, made up 11 percent.

Companies remain divided on whether to maintain a balance between full and modified benefit policies. Some aim for a specific mix to manage risk and pricing assumptions, while others allow the market to dictate the distribution.

Geographic Trends

Texas, Florida and North Carolina — three of the most populous states — led in raw premium basis sales, collectively accounting for 26 percent of the total. On a per capita basis, these products are focused primarily in the Southeast and South Central U.S. Louisiana, Mississippi and South Carolina led the nation, highlighting regional differences in demand and agent penetration.

Looking Ahead

The outlook for 2025 is optimistic. While 71 percent of participating companies expect moderate industry growth (2–10 percent), 46 percent anticipate significant growth (over 10 percent) in their own final expense sales.

Figure 2a. Industry Final Expense Sales Expectations

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Figure 2b. Company Final Expense Sales Expectations

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This confidence is supported by continued investment in technology, agent recruitment, and product innovation. Automated underwriting is now used by more than two-thirds of carriers, and 89 percent of new business is submitted electronically. These efficiencies are helping companies scale while maintaining service quality. Industry organizations like LIC play a key role in supporting carriers as they navigate the evolving final expense marketplace. “The LIC is proud to serve as a resource to help carriers succeed in the final expense marketplace,” said Dean Lambert, executive director, LIC.

Conclusion

Final expense insurance is a dynamic and growing market. Independent agents remain central to distribution, simplified issue policies dominate product offerings, and technology is enhancing both underwriting and application processes. With strong year-over-year growth and a positive outlook for 2025, the final expense market is well positioned to continue meeting the needs of underserved consumers seeking affordable, accessible life insurance coverage.

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