How to Find the Best Funeral Insurance – Forbes | Team Cansler

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If you haven’t set aside money to help your family pay for funeral, medical, or other expenses after your death, funeral insurance can be a way to ensure your loved ones can meet those costs.

What is funeral insurance?

Funeral insurance – also known as “funeral insurance” or “expenses insurance” – is a type of life insurance intended to cover final expenses and funeral expenses. It is a life insurance policy that is purchased in smaller amounts, usually between $5,000 and $25,000.

Because burial insurance is designed for a specific purpose, it is not intended as life insurance for families with major financial obligations such as a mortgage or college tuition. It is often marketed to elderly people on a tight budget who would otherwise not have the savings to pay for funeral expenses when they die.

How does funeral insurance work?

When you take out funeral insurance, you choose the amount of coverage you want and choose a beneficiary. If you die, the beneficiary can claim the death benefit and use those funds to cover funeral expenses. This may include funeral and viewing, cremation, medical expenses, legal fees and more.

Funeral insurance often has a tiered death benefit, meaning your beneficiaries will not receive the full death benefit if they die within the first few years of the policy. Instead, they get a refund of the premiums you paid and some interest.

Funeral insurance is usually either simplified or guaranteed life insurance.

  • Simplified edition life insurance: There is no health test for simplified issuance life insurance, but if you answer “yes” to a health question, you may be disqualified. For example, simplified problem applications often ask if you live in a nursing home or have HIV.
  • Life insurance with guaranteed issue: A life insurance policy with a guaranteed issue cannot be refused. There is no medical examination and no health-related questions. These conveniences make it a very expensive option to buy life insurance.

How to get the best funeral insurance

When it comes to finding the best funeral insurance, you need to consider your estimated final cost, your budget, and any specific insurance needs, and then choose a reputable insurer that can meet those needs.

Here are a few considerations when purchasing funeral insurance.

  • Does the insurer offer the level of coverage you need?
  • Does the premium fit your budget or do you need to adjust your insurance cover?
  • Is a medical examination required?
  • Does the insurance have good customer reviews?
  • Does the insurance company have high industry ratings, e.g. B. from AM Best?

Many major insurers allow you to get a funeral insurance quote online. It’s a good idea to compare life insurance quotes from multiple insurance companies before making a decision.

How much does funeral insurance cost?

A $10,000 funeral insurance policy costs an average of $47 a month for a healthy 50-year-old man, according to an analysis by Forbes Advisor.

Factors that contribute to the cost of funeral insurance include:

  • Age
  • gender
  • coverage amount
  • tobacco use
  • General Health

Funeral insurance tends to be a more expensive option than other forms of life insurance when you compare the death benefit to the premium cost. That’s mainly because funeral insurance applications don’t typically require a physical exam or detailed medical information, increasing the risk for the insurance company.

How much does a funeral cost?

The national average cost of a funeral with viewing and burial was about $7,848 in 2021, a 6.6% increase over the past five years, according to the National Funeral Directors Association. The average cost of a cremation funeral was approximately $6,971, an increase of 11.3% over the past five years.

Keep in mind that your own funeral expenses can be much higher or lower depending on the services you choose and where you live.

Is funeral insurance worth it?

Funeral insurance is worthwhile if you only need a small policy to cover the final costs.

Funeral insurance is convenient because it usually doesn’t require a medical exam or lengthy application. Premiums are also cheaper than comprehensive permanent life insurance and coverage is guaranteed.

On the other hand, since burial insurance does not pay out a large death benefit, your family could be responsible for additional expenses after your death. Since there is often no medical examination, you also do not benefit from a reduced fare in order to be healthy.

Depending on your situation, funeral insurance may not be as affordable as other types of life insurance.

Alternatives to funeral insurance

Funeral insurance isn’t your only way to cover final costs. Before you commit to a policy, consider these alternatives first.

Funeral insurance in advance

This essentially works as a payment schedule for funeral expenses that you set up in advance. You choose the specific funeral home as well as your preferred final arrangements. It then calculates your final expenses, which you can pay at once or in installments over time.

Permanent Life Insurance

This type of insurance protects you for life (as long as the premiums are paid). It’s quite a bit more expensive than term life insurance, but there are a variety of permanent life insurance options, such as: B. whole life, universal life and variable life, which come with different costs and benefits. Long-term life insurance also has a cash value that increases over time, which you can withdraw or borrow.

Payable on Death (POD) account

While you can certainly put money aside in a traditional savings account to pay for funeral expenses, the money could be tied up in estate administration after you die. A POD account, on the other hand, allows you to set aside money for a funeral without the risk of probate. They nominate a person who can dispose of the money in the event of death. Before that, they are not allowed to make any withdrawals, but you can deposit or withdraw funds into the account at any time.


You can set up a trust that owns your existing life insurance policy. When you die, the trustee makes a claim and the funds are distributed according to your instructions. There are also special funeral homes that allow you to set aside money for a funeral and appoint a trustee. The trustee uses these funds to pay for your funeral expenses after your death.

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