Burial and funeral planning are a key part of any long-standing financial plan. While both can have high costs, burial insurance can help your loved ones sustain the expenses — so they don’t feel overloaded. We’re going to talk about some of your best options for burial insurance. But first, we’ll answer some common questions.
What Is Burial Insurance?
Burial insurance, aka funeral insurance or final expense insurance, is a special type of life insurance that’s meant to pay end-of-life expenses. Most of the time, this is whole life insurance, so it remains in place — throughout your lifetime — as long as you pay premiums.
Note: Some insurance carriers offer term life coverage for burial costs.
Different policies may have different structures. A whole life burial policy may let you gather cash value that you can borrow against.
When Does the Process Begin?
It begins when a person decides they need coverage. If you think your family will need extra money to cover burial costs, it’s a good time to search for a suitable insurance policy. When you buy a policy, you usually make monthly payments, which go towards paying your beneficiary the policy amount — after you pass away. Your beneficiary gets a fixed sum when you die; with the policy setting the amount.
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How Much Is the Typical Coverage Amount?
Burial insurance policies usually range from $5,000 to $50,000. The death benefit can go directly to your beneficiaries to handle burial expenses. You may wonder, how does it differ from ordinary life insurance?
Traditional life insurance offers more coverage that can be used to pay burial costs, PLUS daily living expenses, college tuition, mortgages, and other debts. If burial insurance is a missing item in your financial plan, we list some carriers below that offer suitable coverage to help you pay for final expenses.
How Much Does Burial Insurance Cost?
Similar to life insurance policies, burial insurance varies in costs. It depends on how large a policy you select. Other factors are in play as well, such as your gender, age, and health. Expect to pay around $50 per month, on average, for a $10,000 burial insurance policy.
What Are Your Best Options for Burial Insurance?
Since many life insurance carriers also offer burial insurance, you have several options. We studied them and picked the top three — based on the plan’s flexibility, premium rates, coverage, and the kind of plans offered. These are all companies we work with!
- Mutual of Omaha
Great for Smaller Burial Expense Needs
If you think you’ll have a smaller funeral or may choose cremation, you probably won’t need $25,000 + in burial insurance. Mutual of Omaha offers smaller guaranteed whole life policies (these are burial policies) — with coverage starting at $2,000 — to people ages 45 to 85. The age range could vary slightly by state.
There’s a two-year waiting period. This means that if you die within the first two years, your beneficiary would only get a benefit amount that equals the premiums you’ve paid — plus 10%. However, after the first two years, your beneficiary is deserving of the full benefit amount.
Excellent for Additional Protection
Burial insurance can make it easier for your loved ones to handle burial and funeral expenses after you’re gone. But some policies also include living benefit protections. AIG Direct has a guaranteed issue whole life policy — intended to help with final expenses — while also providing coverage for chronic and terminal illnesses. This additional protection is a real game-changer.
If you’re diagnosed with a chronic illness (like HBP or diabetes), AIG will return all premiums paid up to 25% of the policy’s face value. If you’re diagnosed with a terminal illness (like breast cancer), AIG gives you access to 50% of your death benefit amount — while you’re alive — to help pay for medical care or other costs. These perks come with an administrative fee. But again, the options can provide some additional relief should you develop a severe illness later in life.
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Great for No Waiting Period
Buying burial insurance when you’re younger and healthier? If so, a waiting period may not be a huge fuss. On the flip side, having a 1-3 year waiting period could disturb your financial approach — if you’re “high-risk” (you have a severe health condition or you might pass away before the waiting period ends).
Transamerica’s Immediate Solution burial policy is meant to cope with that. With no waiting period, this policy covers you pronto. If you’re between 45 and 85, you can apply for coverage ranging from $1,000 to $50,000. Your age determines the maximum benefit amount.
Competitive pricing is available for those who want to get burial coverage right away, and they can add on riders for accelerated death benefits if needed.
Interested in Burial Insurance? We Can Help
If one of these burial insurance options appeals to you, contact Final Expense Direct. As an independent agency, we work with the top burial insurance companies to make sure our customers find the best, most affordable coverage for their needs. Give us a call or find us online.