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  • The Complete Guide to Burial & Funeral Insurance

    Burial Insurance GuideWhat is Burial or Funeral Insurance & How Does it Work?

    Burial insurance, also called funeral or final expense insurance, is a helpful tool for loved ones paying for a departed family member or friend’s funeral, memorial service, headstone, urn, and other final expenses. It is essentially a life insurance policy, but with a much smaller benefit amount than traditional life insurance. It’s usually purchased to cover final arrangements, but can also be used to pay the deceased’s debts, including medical bills, credit card bills, mortgage loans, and personal loans. If you think you and your family may benefit from burial insurance, it’s easy and quick to get a free quote for a final expense life insurance policy.

    Burial Insurance for Seniors

    Coverage is usually best suited for people ages 50 to 85, although most companies offer plans to those as young as 30 days of age. Most burial insurance policies are a type of life insurance called “whole life insurance.” This type of insurance has no term to it and is considered paid-up at age 100 in many cases.

    Researching this type of plan should be part of every senior’s end-of-life financial planning, but you may not want to wait until you’re retired to start preparing. Plans get more expensive the older you are, and most providers have a maximum age limit for buying one, so it’s a good idea to look into getting one as early as possible. The younger you are, the cheaper your rates will be. If you’re over 50 and think you will benefit from this type of coverage, look into your options when you’re drawing up a will, updating your power of attorney (POA) and other guardianship documents, and assigning beneficiaries to your financial accounts. Learn more about affordable life insurance over 50.

    Funeral Insurance Costs & Premiums

    Insurance premiums are based on your age, sex, the size of your policy, and your current health. Everyone that seeks coverage — and every company that provides it — is different, so be sure to ask for a personalized quote from any provider you’re considering. Learn more about how much a funeral costs to estimate how much coverage you’ll want.

    Here is a summary of what you can expect to pay in premiums based on your age and sex.

     

    Monthly Premium Rates for Men*

    $5,000 Death Benefit
    Age Determined ‘In Good Health’ by Insurer No Health Questions Asked
    50 $16 $20
    55 $19 $24
    60 $23 $29
    65 $29 $35
    70 $38 $44
    75 $51 $63
    80 $65 $82

    * Estimated rates do not reflect the rates of any particular life insurance company.

    $10,000 Death Benefit
    Age Determined ‘In Good Health’ by Insurer No Health Questions Asked
    50 $30 $40
    55 $35 $46
    60 $43 $57
    65 $56 $68
    70 $74 $88
    75 $100 $125
    80 $126 $162

    * Estimated rates do not reflect the rates of any particular life insurance company.

     

    Monthly Premium Rates for Women*

    $5,000 Death Benefit
    Age Determined ‘In Good Health’ by Insurer No Health Questions Asked
    50 $14 $15
    55 $16 $18
    60 $18 $24
    65 $22 $28
    70 $28 $35
    75 $38 $46
    80 $48 $64

    * Estimated rates do not reflect the rates of any particular life insurance company.

    $10,000 Death Benefit
    Age Determined ‘In Good Health’ by Insurer No Health Questions Asked
    50 $25 $28
    55 $28 $36
    60 $33 $45
    65 $41 $55
    70 $53 $69
    75 $72 $90
    80 $93 $126

    * Estimated rates do not reflect the rates of any particular life insurance company.

     

    As you can see, women usually pay less than men for the same coverage. Rates for both men and women increase with age, and you can save a significant amount of money by answering health questions on your application.

    Average Funeral Expense Coverage

    Coverage can range anywhere between $5,000 and $20,000, with most policies falling around $10,000 for both men and women. When deciding on the amount you’ll need, it’s important to consider what kinds of final arrangements you want, as well as if you want enough left over to cover bills and other debts.

    GET MY FREE BURIAL INSURANCE QUOTE

    Pros & Cons of Burial Insurance Policies

    As with anything you buy, there are pros and cons to this kind of investment.

     

    Pros Cons
    Easier to qualify for than most life insurance plans Lower benefit than most life insurance plans
    Few, if any, health questions to answer If no health questions, you won’t receive a discount for being in good health
    No medical exam needed Rates are slightly higher
    Options for pre-arranging services & paying for them ahead of time Amount paid in premiums may be more than the funeral cost
    Usually accumulates cash value that can be used while the policy is activeTypically little to no extra funds after funeral expenses have been paid

     

    The best way to decide if one of these plans is right for you is to do a little research. Reach out to a few companies for quotes and weigh your options after you’ve written out your needs and your budget.

    2 Types of Funeral Insurance Plans

    There are two basic kinds of funeral insurance: standard and pre-need. Both will help you plan and set aside the funds for all of your final arrangements.

    Standard Funeral Insurance

    Offered by life insurance companies as a whole life policy, these are paid out to beneficiaries upon the death of a loved one to pay for final arrangements, which may include:

    • Funeral 永续合约|合约交易所_永续合约home services
    • Transportation
    • Opening and closing of grave
    • Casket
    • Headstone, grave vault, flowers, obituary notices
    • Cremation (learn more: How Does Cremation Work?)
    • Urn

    Your loved one is also able to work with any service providers they wish. The beneficiary may choose to apply some or all of the funds to other expenses or debts owed by the deceased, including:

    • Legal services
    • Medical bills
    • Credit card debt
    • Mortgage, car, personal, or other loans

    Pre-need Funeral Insurance

    Pre-need agreements are offered by life insurance companies and, in some cases, funeral 永续合约|合约交易所_永续合约homes. However, these funds are given directly to the funeral 永续合约|合约交易所_永续合约home you’ve chosen to work with instead of a designated loved one. They are paid out almost immediately after one’s passing.

    Pre-need insurance can help people save money by allowing them to pay for services that may be cheaper today than they will be in the future. However, if you pay more for your plan than you do for your funeral, your loved ones won’t receive the difference (the same is true for burial insurance). That means that if you take out a $10,000 plan but your final arrangements are only valued at $9,000, the funeral 永续合约|合约交易所_永续合约home won’t give your loved ones the leftover $1,000. Learn more about what to do when a loved one dies.

    How to Choose the Best Burial Insurance Plan for You

    Choosing the right plan is a very personal decision, and there are many important factors you should consider when making your decision, including:

    • How much coverage you need
    • Whether or not the insurance provider has support services for your family
    • Whether or not you want to take a medical exam
    • How much the average cost of a funeral is in your area

    Shopping for burial insurance is like shopping for a car. Every policy will have the same basic features, but the finer details will separate one policy from another. Make sure you choose a policy that supports the specific reason you’re insuring yourself.

    4 Types of Funeral Insurance Premiums

    A premium is the amount you will pay for your policy each period. In most cases, you’ll make monthly payments. Funeral insurance premiums come in a few different forms.

    Stepped Premiums

    These are calculated each year you renew your policy using your sex, age, and the size of your death benefit. You will pay a lower premium in the beginning, but you’ll pay more each year as you get older.

    Leveled Premiums

    These rates are also established using your sex, age, and the size of your policy. Your rates are usually locked in for life as long as they’re paid. They can’t be increased due to changes in age or health.

    Capped Premiums

    These plans have a set monetary or age limit. Once you’ve reached it, you’ll keep your coverage, but will no longer have to pay premiums. For example, if you’re capped at $10,000, you won’t have to pay any more premiums once you’ve paid that amount. If your policy has an age limit of 95, your coverage will continue once you hit that birthday, but you’ll be done paying any premiums.

    Payout Guarantee Premiums

    Your beneficiary is guaranteed to be paid whichever total is higher: the exact amount of premiums you’ve paid or the original insured amount.

    Burial Insurance with No Waiting Period & No Exam

    Many providers offer plans that are guaranteed to pay out the full death benefit amount as soon as the first payment is made and the application is approved. This means that if you make a single premium payment and then pass away, your beneficiary will receive the full amount you were covered for (as long as nothing was misrepresented to the insurer).

    These plans require you to answer basic health questions when you apply. You aren’t required to take a medical exam, give blood or urine samples, or provide your medical history. The coverage is based on your answers to the health questions on the insurance application. It’s important to answer these questions honestly. If there are any discrepencies, your policy’s claim may be denied.

    How to Get Quotes & Buy Online

    Many companies that provide final expense insurance offer a free online quote and allow you to sign up on their websites. You can compare multiple policies from several companies to help you narrow down which plan is best for you.

    Whether you conduct research on your own or work with a life insurance agent, it’s a good idea to get multiple quotes so you can weigh your options. Everyone has different needs, and by signing up for the first or cheapest plan you find, your loved ones may not have all of the funds they need to carry out your final wishes.

    Burial Insurance Plans for Families

    For the most part, there aren’t family plans for burial insurance. Remember, policies are determined by age and sex, and sometimes the applicant’s health. This makes it difficult for companies to bundle individuals together in a family plan.

    If you, your partner, and/or other family members are all considering getting one of these policies, it’s worth calling a few companies to see what options are available. People also often ask if they can buy life insurance for their parents.

    Alternatives to Traditional Burial Insurance

    Many people rely on life insurance to cover their final expenses. This can be a good option, especially if you have a large policy that will cover your final arrangements in addition to other debts and expenses your family will be responsible for after your passing. However, these types of policies have different requirements, rules, and focuses than burial or funeral insurance.

    Term Life Insurance

    Term life insurance covers you for only a set period of time. Once that period of time is up, you will need to purchase another policy – usually at a much higher rate – to stay covered. If you don’t renew your policy and pass away, there is no policy protection. Because we don’t know when we’re going to die and can’t predict if it will happen within the policy’s term, this isn’t a good option for paying for final expenses.

    While you can renew this type of plan, they cost more the older you get, so you may end up paying more money than you would if you signed up for burial insurance. If you’re counting on using term life insurance to pay for your final arrangements, take a look at your policy to see if it can be converted to a whole life or other permanent plan. Exercising this option gets more expensive as you age, so the sooner you do it the better.

    Universal Life Insurance

    In most cases, universal life insurance isn’t a good option because it relies on interest rates. When interest rates increase, these policies grow in value, but as they fall, it takes more money — in the form of higher premiums — to keep them beneficial to consumers. If you have one of these policies, you may be able to transfer its value to a whole life policy.

    Guaranteed Issued Whole Life Insurance

    These aren’t usually an ideal option simply because they are expensive. There is no underwriting involved, which means the provider doesn’t assess the risk of offering coverage to applicants. This usually means everyone pays a much higher premium than they would with traditional whole life insurance to compensate for the risk the insurer is accepting. Because these are often appealing options to individuals who have issues finding life insurance coverage — for example, an 80-year-old man who has suffered three heart attacks — these policies can cost much more than other options.

    Burial Insurance vs. Life Insurance

    Burial insurance is a type of life insurance, but it has a much smaller benefit amount than traditional life insurance policies. This is because burial policies are meant for taking care of final arrangements only, while life policies are taken out to cover a wide array of needs such as income replacement.

    Although payouts from burial insurance can be used for other expenses at the beneficiary’s discretion, benefit amounts are tailored to cover only final arrangements. That’s why they’re usually offered in amounts of $5,000 to $20,000, whereas traditional life insurance can offer benefits of hundreds of thousands of dollars.

    $255 for survivors of individuals who received to help cover final expenses, but only if they meet certain requirements

    How Do I Convert a Life Insurance Policy into a Burial Policy?

    You can’t convert a life insurance policy into a burial policy. Many people believe you can because life insurance policies are often used to pay for funerals, but you can’t make this change. The easiest way to make sure your life insurance policy covers your funeral expenses is to document your final wishes and share them with your loved ones in advance.

    19 Best Burial & Funeral Insurance Companies

    You have a lot of options when it comes to choosing funeral insurance. These companies are frequently rated by consumers as being trustworthy providers. It’s important to note that only Lincoln Heritage Life Insurance Company includes free funeral planning with their final expense product Funeral Advantage.

      • American Continental Insurance Company (Aetna)
      • American International Group (AIG)
      • American Memorial Life Insurance
      • American National
      • Americo
      • Assurity
      • Baltimore Life
      • Fidelity
      • Foresters Financial
      • Gerber Life Insurance
      • Kemper Senior Solutions
      • Liberty Bankers Life
      • Lincoln Heritage Life Insurance Company
      • Mutual of Omaha
      • Royal Neighbors of America
      • Sagicor Life Insurance Company
      • Sentinel Security Life
      • Transamerica
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