Regretfully, many consumers are misled by advertisements on TV for Burial Insurance or Final Expense Insurance.
Unless you pay very close attention, you’ll likely end up purchasing life insurance at very high rates, and a waiting period before the full death benefit is payable for death due to natural causes.
These policies are commonly referred to as guaranteed acceptance or guaranteed issue and were designed for seniors with severe or even multiple health conditions who typically cannot qualify for traditional life insurance coverage.
We certainly don’t claim there is anything wrong with these types of policies, only that they should be purchased as a last resort if you cannot medically qualify for level benefit burial insurance with no waiting period.
Why Burial Insurance – Is it Worth It?
If you are between the ages of 50 and 85 and already have a sufficient amount of life insurance that will take care of all the financial needs you want to be covered (including the cost of your funeral and burial), you may not need burial insurance.
If, however, for whatever reason, you are not adequately insured or do not currently have life insurance, who do you think will end up paying for your funeral or burial expenses when you die?
In almost every case, if a person dies without life insurance, that person’s friends and family will be strapped with the cost of a proper funeral and burial. Not because they have to, but because they’ll feel it’s the right thing to do.
If having your friends and family pay for your funeral bothers you, then, by all means, start looking for a burial insurance policy now. It will never cost you less than what it costs today.
What is Level Benefit Burial Insurance?
Burial insurance (or final expense and funeral insurance) typically comes in three different plans that are designed to accommodate the health issues of the applicant:
- Level Benefit insurance (typically the best deal available) for generally healthy applicants without serious health issues during the last two or three years.
- Graded Benefit insurance is generally offered to applicants with some health issues and typically comes with higher rates and a graded payout if death is the result of natural causes in the first two or three years.
- Guaranteed Issue (guaranteed acceptance) insurance is for applicants who cannot qualify for the level benefit or graded benefit plans. With a guaranteed issue policy, the rates are much higher than a level benefit or graded benefit policy, and a two-year waiting period is required when the company will only pay a return of premium paid plus about 10%. Since medical conditions are not considered in the underwriting process, virtually any living person can purchase guaranteed issue burial insurance.
How much Burial Insurance do I Need?
The amount of burial insurance you purchase should depend on the amount of money you want to pass on your friends or family through a designated beneficiary. The amount should be enough to cover at least your funeral and burial expenses.
Many applicants, however, will purchase additional coverage to pay for any lingering medical expenses or outstanding nursing home bills that are not covered by your health insurance.
Most applicants end up purchasing an amount they can comfortably afford even if they already own life insurance that is designated for other financial needs that surviving loved ones will likely contend with after your passing.
What does a Funeral and Burial Cost?
Like most other products and services, funeral and burial costs are not immune to inflation. For this reason, it makes good financial sense to purchase additional life insurance today to cover what a funeral and burial will likely cost in the future.
Although funeral costs differ geographically, the average cost of a funeral and memorial service plus the costs of the grave services according to Parting.com are as follows:
- Casket – $2,300 (can be purchased outside of the funeral home)
- Funeral Directors Service fee – $1,500
- Body preparation and embalming – $600
- Viewing and Memorial – $1,000
- Transportation, obituary, and death certificates – $600
- Cemetery Plot – $1,000
- Opening and closing of the gravesite – $1,000
- Headstone or Marker $1,000 – $2,000
As you can see by the costs of products and services listed above the average cost of a funeral and burial starts at about $10,000. Certainly, this price could go up based on the additional services your family might prefer, or it could be lower if you do some pre-planning and lock in the lowest rates possible.
How much does Burial Insurance Cost?
Your cost for burial insurance is generally predicated on four basic things:
- Your health when you purchase your policy
- Your age when you purchase your policy
- The amount of death benefit you choose
- The company you select after shopping for coverage
Here are the actual rates for a $15,000 (most popular) final expense and burial insurance policy for a healthy male and female non-smoker:
|Age of Applicant||Male Non-Smoker||Female Non-Smoker|
To discover the most affordable rates for your actual age, take advantage of our insurance quote engine located on the right of the page or at the top on a mobile device.
Best Burial Insurance Companies offering Level Benefit Plans
Fortunately for consumers, there is a lot of competition in the Final Expense and Burial Insurance category. The more companies that we have competing for your business, the lower the rates we can offer.
LJM Life Insurance is pleased to offer these five highly-rated insurance companies to deliver the best life insurance solution for your circumstances and needs: