TLTR: End-of-life expenses can burden your family long after you’re gone. Read on to find out what burial insurance covers and how it can relieve your loved ones of financial difficulties.
Contemplating our mortality is certainly something most of us like to avoid in general, let alone discussing it with an insurance agent. But from a practical point of view, it’s well worth doing. Passing on requires a lot more than a wake or a burial plot—consider the cost of the casket, auto rentals, memorial services, flowers, and more. Paying these bills out of pocket can add up to a small fortune.
Your family’s finances and well-being may depend on whether you invest in a comprehensive burial insurance policy. Luckily, burial insurance, also commonly referred to as funeral insurance or final expense life insurance, is affordable and easy to qualify for.
A burial policy isn’t a P&C policy; personal articles floaters insurance won’t cover your burial plot or urn. Rather, it’s widely considered a whole-life insurance policy with a smaller claim amount and a particular purpose—saving your loved ones the trouble of going through a financial crisis after you’ve passed on.
Burial Insurance Vs Life Insurance
Traditional life insurance is comprised of a multitude of insurance policies. Burial insurance is one of those policies included in life insurance. It covers all the funeral expenses of insureds after they pass away. In short, burial insurance is a life insurance policy with a more specific coverage than life insurance.
The maximum amount of a traditional life insurance policy you can purchase can come to millions, depending on your age and annual salary. However, Protective states that the maximum death-benefit amount of burial insurance is usually $50,000 (some insurers may offer higher amounts).
Your insurance provider will ask about your family history, health records, and annual salary before they qualify you for a life insurance policy. But burial insurance is much easier as well as faster to get, with little to no health-related questions or medical exams.
Burial insurance is best suited for people aged 50 and above. Whereas traditional life insurance is appropriate for individuals of all ages.
Is Burial Insurance Worth Buying?
For final expenses such as a funeral, burial plot costs, cremation, casket fee, and vehicle costs, the median total costs come to about $10,000 for an American family, as per the National Funeral Directors Association. But keep in mind that the Federal Trade Commission introduced the Funeral Rule, which gives you the right to:
- Compare funeral homes and their prices.
- Buy only the funeral items you want.
- Get a written price list for items as well as services provided by the funeral homes.
National Public Radio reports that most local funeral homes are extremely vague about their actual prices. Either you or a mourning family member is forced to get on call after call with several funeral homes negotiating prices in a world where costs of all other services and goods are available at the click of a button.
A funeral insurance policy takes care of all your funeral costs, without anyone having to worry about miscellaneous details.
How Does Burial Insurance Work?
Burial insurance policies are extremely easy to set up. You’re not required to get medical examinations, but you may be asked to fill out a questionnaire. Upon an insured’s death, their beneficiary only needs to contact the insurance provider with a copy of the policy, a copy of the death certificate, and a claims form to begin the claims process. You should receive your claim amount within the next 60 days.
Types of Burial Insurance
Burial insurance comes in many types, so you have the option to choose the coverage you need. Here are two common types of burial insurance policies that you can opt for:
- Guaranteed Issue Life Insurance: This policy is great for individuals who would otherwise not qualify for other life insurance policies. Guaranteed issue life insurance won’t ask pesky medical or health-related questions. Your terminal illness won’t stop you from getting a final expenses insurance policy. You pay a fixed minimum premium that won’t skyrocket due to your illnesses. As the name implies, you’re definitely guaranteed an insurance policy.
- Simplified Issue Life Insurance: A simplified issue life insurance is the same as a guaranteed issue life insurance in terms of rates and coverage. Nonetheless, you will have to answer health-related questions such as whether you’re diabetic or living in a nursing home. The answers can determine whether or not your provider will deny you coverage.
What Does Burial Insurance Cover?
Opting for burial insurance will pay out a benefit amount for the following expenses in case of accidental death, terminal illness, or death from natural causes:
- Funeral home expenses
- Gravedigging costs
- Crematorium costs
- A hearse or van costs
- Burial plot
Additionally, you or your beneficiaries can pay for any outstanding debts, medical fees, credit card payments, or legal fees with any leftover amount.
How to Apply for A Burial Insurance Policy?
Applying for and qualifying for burial insurance is relatively easy. Here are five simple steps you can follow:
Step 1: Look around for the policy that would suit you best. The biggest mistake most people make while purchasing insurance is that they settle for the minimum coverage. Your unique lifestyle begs for tailor-made policies that insurance companies are happy to cater to.
Step 2: Talk to an experienced insurance agent and consult them regarding coverage, endorsements, and discounts. The agent will ask you questions as well as offer you quotes from a few companies that best fit your needs.
Step 3: Complete the application online or over the phone. Burial insurance doesn’t require medical exams, questions, or physical tests. It’s that easy!
Step 4: You will qualify for the coverage in less than a week or so. Once your plan is approved, the insurance company will send a copy of your policy to you within two weeks. After payments are set up, you’ve successfully acquired a burial insurance policy.
Burial Policy with No Waiting Period
Most burial insurance policies have a waiting period of about two years. That means that in the event of death within the first 24 months of the policy, the beneficiary will only get 10% of the coverage amount. In some cases, they will get partial coverage in the event of the insured’s death in the first 12 months.
Burial insurance with no waiting period will guarantee that they get the full coverage amount regardless of when the insured passes away. Whether you’ve made only one premium payment or several, your insurance company will pay out the full benefit amount to your beneficiary.
Best Burial Insurance Companies of 2023
A lot of insurance providers sell burial coverage. Here’s a list of companies that have the best burial insurance policy in terms of ease, pricing, value, and waiting period, according to Investopedia:
How Much Does Burial Insurance Cost?
Nerd Wallet reports that the benefit amount for most burial insurance policies is between $5,000 and $25,000. Some factors that affect your premium are your age, gender, payout, as well as overall health. You can determine whether to pay your premiums on a weekly or a monthly basis.
Best Burial Insurance for Seniors
Naturally, final expense insurance policies or burial insurance for seniors, make sense for people over the age of 40 to purchase. The premiums for seniors vary depending on your age, gender, and health status. Most insurance companies will prepare a tailored quote according to your budget and desired coverage. Below is a list of gross premium amounts based on an individual’s age range and gender for a $10,000 death benefit with no waiting period.
Connect With a Burial Insurance Agent Near You
Do you require a dependable burial insurance policy? Are you sick of looking online for a final expense insurance quote?
Save yourself the trouble and use us to find a reputable burial insurance agent near you.
A good insurance agent will do more than sell you a policy. These agents are as distinct as the customers they serve. As a result, as a buyer, you must understand your coverage requirements and be able to express them clearly to an agent.
When you’ve found a potential insurance agent in your area with whom you’d like to collaborate, try the following:
- Check with your friends and family about their services
- Investigate the policy options they provide
- Get acquainted with their behavior and personality
- Their insurance industry experience
You can be confident that the agents you find on Agency Height are among the best in the industry and your neighborhood. These agents understand the locality and can get you the right coverage per your needs and budget.
Burial insurance helps relieve unnecessary difficulties for your loved ones in an already difficult time. Let your passing be about your family celebrating your memory and not about scrambling to find the money to pay for your funeral expenses.
Has this article been helpful to you? Let us know in the comments section.
If you’re looking for experienced local insurance agents to help you find the right burial insurance policies, then we can help! Get in touch with our experts, find an agent today.
Who is the beneficiary of a burial policy?
The beneficiary of a burial policy is the individual or entity chosen by the policyholder to receive the death benefit payout upon the policyholder’s passing. This beneficiary is typically someone close to the policyholder, such as a family member or a trusted person responsible for handling funeral and burial expenses.
Do I need burial insurance if I’m a young adult?
While burial insurance is not typically necessary for young adults who do not have dependents or significant financial obligations, it can still be a consideration for those who want to ensure their funeral expenses are covered or alleviate the burden on their loved ones.
How is death benefit calculated?
The death benefit of a life insurance policy is typically calculated based on the coverage amount chosen by the policyholder. It is the predetermined sum of money that will be paid out to the beneficiaries upon the insured person’s death. The specific calculation method may vary depending on the type of policy, such as term life insurance or whole life insurance, and factors such as the policyholder’s age, health, and desired coverage amount.
Which is Better: Life Insurance or Burial Insurance?
If you’re a senior over the age of 65 and looking for a considerably lower premium, burial insurance is the way to go. Furthermore, insurance companies can deny life insurance policies if you have terminal illnesses or pre-existing medical conditions. Final expense insurance cannot be denied once paid for, and your beneficiaries can use the amount to cover your outstanding credits or medical bills as well.
It’s very rare for life insurance policies to come with lower coverage than $100,000 with a term life of more than 10 years, which may not be what seniors want. If you’re looking for policies without a medical exam or health-related questions, covering from $10,000 to $25,000 with no waiting period, then burial insurance is right for you.
Are Burial Expenses Tax Deductible?
Unfortunately, there’s no tax deduction for burial insurance for individuals. Only estates worth $11 million or more can claim tax deductions for selective funeral costs. If your estate pays federal taxes, then you can write off these funeral costs:
- Funeral home director and facility costs
- Burial plot
Is Burial Insurance Different from Preneed Insurance?
Preneed funeral insurance is much the same as a burial policy. This policy covers the cost of funeral expenses so that your family members don’t feel the financial burn. It doesn’t require a physical test or medical exam, and the benefit amount ranges from $10,000 to $25,000, depending on the coverage you need.
The major difference is that preneed insurance directly pays the funeral home instead of the family. The insured will work with the service provider of their choice and choose precisely what they want. The family is saved from the trouble of having to make difficult decisions while mourning the loss of a loved one. It’s also a great way of protecting your finances from increasing costs by paying out the funeral home in today’s prices for the future.
Which is The Best Burial Insurance Company?
Mutual of Omaha is the best burial insurance provider in the country. Mutual of Omaha is a well-known brand name with a solid financial foundation. Their policy is generally less expensive than that of other providers, and they provide coverage with no waiting period to seniors with pre-existing conditions.
July 10th, 2023 · 10 mins read
- Burial Insurance Vs Life Insurance
- Is Burial Insurance Worth Buying?
- How Does Burial Insurance Work?
- Types of Burial Insurance
- What Does Burial Insurance Cover?
- How to Apply for A Burial Insurance Policy?
- Burial Policy with No Waiting Period
- Best Burial Insurance Companies of 2023
- How Much Does Burial Insurance Cost?
- Best Burial Insurance for Seniors
- Connect With a Burial Insurance Agent Near You
- In Conclusion
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