If you are looking for burial insurance for yourself or funeral insurance for parents (or friends or a spouse), then there are some things you need to consider. First, you should consider what expenses you want covered in the event that you or someone you love passes away.
What Does A Funeral Cost?
At the very least you should consider covering the cost of our funeral. This would include the transportation of the body, embalming, the coffin, use of the mortary facilities, cost of renting a hurst, a cemetery plot, head stone, flowers, the service and any labor that might be involved. These final expenses can easily surpass $10,000; especially, if you don’t know what you are doing.
How Do You Plan a Funeral?
It is important to know how to arrange a funeral. Some companies, like Lincoln Heritage Life Insurance Company have a funeral plan called Lincoln Heritage Funeral Advantage Plan. This service is offered from a third party that has partnered with Lincoln Heritage Life Ins co. so that your family is not alone when making funeral arrangement decisions. It’s been noted that these funeral arranging specialist can save you up to 40% on the funeral cost and while you grieve, they take care of everything.
There are other companies that offer a similar funeral plan and you can buy these plans separate from the insurance company. Some life Insurance agents will carry a funeral plan application to their Final Expense appointments. It’s just another value added product to help secure a sale and make sure your client is 100% taken care of.
Of course, you can always arrange the funeral yourself but be sure to do some research and not just trust your local mortary. They thrive on hard times and know that grieving people buy on emotions more than logic.
How Can You Use Life Insurance to Cover Funeral Costs?
If you are wondering how to pay for funeral costs, you can either pay out of pocket from your savings account or buy cheap Term Life Insurance, a Single Premium Whole Life Policy, a traditional Whole Life Insurance policy, a pre need Funeral Insurance Policy (Pre Need Funeral Planning) or a small Final Expense policy. All of these would be considered life insurance because at death, your family will receive some type of cash benefit.
What is Term Life Insurance?
Simply put, Term Life Insurance is a short term Life Insurance policy that ends at a certain age. These types of policies tend be cheaper and have a larger face amount. For example, I have a million dollar life insurance on me in case I die in 20 years from the date of purchase. Why would I want a million dollars? Because I still have two young children that I want to make sure are provided for in case of my death. Once they reach the age of 18, I won’t need a policy this large because I would be leaving behind less responsibilities. That is why I got a 20 year policy. I could have gotten a 10 year or a 30 year policy but my needs were met with a 20 year policy.
Life insurance term rates are based on your age and health. For most term life insurance policies, you are going to have to go through a medical exam and an extensive underwriting background check. If you are young, you can get a million dollar policy as low as $35 a month but as you age, it gets more expensive and basically unaffordable when you get into your 50s and 60s. The older you are, the closer to death you are and the life insurance company will consider you a higher risk and charge you more per month.
This is why Final Expense Life Insurance is so popular when buying Senior Citizen Life Insurance. Term life is just too expensive and generally ends before the senior dies. So It’s best if the insurance agent goes over senior final expense information and focuses on policies that will cover most, if not all, of the funeral expenses.
Term Life vs Whole Life Insurance
When shopping for insurance to cover funeral expenses, you will have to pay close attention to whether the policy is a Whole Life Insurance policy or a Term Life Insurance policy. Some companies like Colonial Penn and Globe Life make their Final Expense Insurance appear to be whole life insurance; however, their policies are what’s called “Term to 80.” This means the policy expires at 80 years old. I can’t tell you how many times I see this each week and the policy holder always thinks they have Whole Life Insurance policy.
Term Life Insurance definitely has it’s place but life insurance for seniors should be Whole Life Insurance. This means, the policy will last until the client dies. Final Expense LIfe Insurance is actually a Whole Life Insurance policy that has less health requirements — otherwise known as a simplified issue life insurance policy.
What is Burial Insurance? Is it the Same as Final Expense Insurance?
Burial insurance is just another name for final expense insurance. It’s life insurance that is intended to cover the final expenses left behind to a family. See this article to learn more.
What is the Top Life Insurance for Funeral Expenses
Here are some top life insurance companies to consider:
- Lincoln Heritage Life Insurance Company
- Baltimore Life Final Expense
- John Hancock Life Insurance
- Banner Life Insurance rating
- Physicians Life Insurance Company
- New York Life Insurance
- Savings Bank Life Insurance
- United Home Life Final Expense
- Alan Benedict Final Expense
- Home Life Insurance Company
- Settlers Life Insurance Company
- Foresters Life
- 5 Star Final Expense
- Securus Final Expense
- Equita Final Expense
- NAA Final Expense
- And so on…
Are there any Guaranteed Acceptance Life Insurance Policies for Someone that is Sick?
There are some Final Expense Insurance Companies that will accept just about any illness. In fact, most companies can approve a sick person but there are conditions. Usually, the policy is not going to pay a benefit for the first two years. Rather, if the client were to die during this 2 year probational period, their family would only get back the monthly premiums that were paid, with interest. The family would get no death benefit.
For clients that are on oxygen or in a nursing home, your options are very limited. You can often get approved my Presidential Life Insurance but the rates will be very high. I have found that it’s best to go straight to a funeral home and start one of their pre payment funeral plans. You can usually pay these off within a 5 year period. Keep in mind though, the monthly payments are significantly more than a monthly Senior Final Expense program.
What is the Cost of Cremation vs Burial – How Much Does Cremation Cost?
Don’t forget that cremation is a viable option too. It’s much cheaper as you don’t need a coffin, grave site, a hurst, embalming etc. The average cost of cremation is anywhere from $1000 – $5000. You can sometimes find it as cheap as $500.
However, most people prefer the traditional burial as we tend to identify with this body and think it is the self. Never mind that the body will still be eaten by worms and the coffin will decay over time. I think I’d rather be cremated but to each his own.
If you do decide to go with cremation, you can still have a nice memorial service and you might want to think about arranging a few urns to put your ashes in. Many family members would like to have this in their home as a memory of their loved ones.
How to Buy Life Insurance
By now, you should understand what life insurance is and how you can use it to protect your loved ones. If you are going to buy life insurance to cover your final expenses, it is recommended that you find a local insurance broker so you can compare life insurance rates. Most insurance agents will have a few companies you can consider.
If you still have questions on what is life insurance, how to get life insurance and the cost of life insurance, please feel to contact us. We are glad to help.
