Burial Insurance, or Funeral Insurance as it is also known, covers expenses associated with having a funeral. These expenses occur from costs such as the casket, the service, the plaque, and the burial plot. Funerals are not cheap and the cost of an average funeral today is upwards of $8,000 dollars. To prevent leaving your family with such a large expense, it may be important for you to research different funeral insurance plans.
A funeral plan is similar to permanent life insurance in that you have a beneficiary, i.e. funeral director, and you make premium payments. A funeral plan lasts the entirety of the policy holder’s life unless the payments are unfinished. The contract binds the funeral director to using the benefits to pay off the predetermined burial cost.
One advantage of burial insurance is that insurers are denied the ability to ask for a medical exam to qualify for burial insurance. However, to qualify basic questions regarding the applicant’s age, gender, if he or she smokes or drinks, and their involvement in other dangerous activities, are commonly asked.
Premiums for Burial Insurance have the option of being paid in the traditional monthly manner or in one large lumped fee. To avoid large fees, making payments early on is important because opting for Burial Insurance later on in life can incur greater costs.
Funeral Insurance also builds cash value and allows the insured to withdraw or borrow against the policy. However, if the individual does not repay the amount borrowed or withdrawn, the money can be removed from the total death benefit payout.
When considering which Burial Insurance provider to use it is important to use data from A.M. Best, Standard & Poor’s, Moody’s, and Fitch. Using research from these companies will allow you to purchase your Burial Insurance with confidence that they will be able to provide the services promised in the future.