Burial Insurance often referred to as final expense or funeral insurance, is a form of life insurance with a smaller pay-out. Generally, this type of insurance is used to pay for the final expenses, such as the funeral, burial, setting up a headstone, finding an urn, and so on. Let’s admit; funeral expenses can be relatively high.
While it may be uncomfortable to plan one’s funeral ahead of time, burial insurance for seniors helps ensure that they do not leave their family in debt. According to experts like Gary P. Cubeta from “Insurance for final expenses”, planning for final expenses provides that the deceased’s family can start their grieving without worrying about taking out a loan.
Should You Opt for Burial Insurance?
Burial Insurance is similar to Life Insurance; however, the pay-out is generally smaller. Although most people use it, they pay-out from burial insurance to cover the funeral costs; beneficiaries can use it to cover debts, and other expenses, such as medical bills, mortgage and more.
For those between the ages of 50 and 85, buying funeral insurance is an excellent way to ensure that their last rites are performed without any worry. Many insurance companies offer coverage starting from the age of 30, while others may have a maximum age limit at which you can buy insurance. Hence, when it comes to burial insurance for seniors, it is best to start planning.
How to Select a Burial Insurance Plan?
Every company offers some form of burial insurance or the other. Each policy will offer similar features, with a few minor changes. However, it would help if you analyzed each policy for the finer details to understand how each is differentiated from the other. A few considerations to keep in mind include:
Required Amount of Death Benefit
Every person opts for burial insurance for different reasons; some may only want to cover funeral costs. Some may wish to cover cemetery costs, and others may buy it to leave extra money behind to cover any other expenses. Before you select a policy, ensure that you check the average funeral costs in your area, as well as cemetery expenses.
Apart from this, consider any other expenses that need to be cleared when you are calculating your desired death benefit amount. However, keep in mind that Burial Insurance policies can only offer a death benefit of up to $25,000. Hence, you should ensure that the death benefit amount will cover your expenses.
Calculating the Premium
Selecting a policy based solely on the amount of death benefit is not possible; after all, you need to be able to cover your premiums as well. Your premium amount will depend on the death benefit amount; your location, age, sex, and health.
Generally, policies which come with mandatory health-check-ups or questions are less expensive than guaranteed acceptance policies. Before you go through the details of any policy, decide on a premium budget.
Most policies come with a waiting period; that is, you will not receive any benefits from the policy unless you have had it for a stipulated time. Hence, many people try to purchase burial insurance early. Ensure that you ask the agent about the waiting period and compare its benefits to those with no waiting periods.
Every policy will charge you an administrative fee, but sometimes there may be hidden costs involved. A company should always be transparent about additional costs; hence, ask them about other policy expenses.
Beneficiaries often have to deal with taxes on policies. However, burial insurance is tax-free. To ensure that your beneficiary receives the death benefit amount without any hassle, check to see if the policy is genuinely tax-free.
Planning for a Burial Insurance may not be the most uplifting experience; however, it helps you ensure that your family members are cared for after your passing. When purchasing burial insurance, you must keep your beneficiary informed about the policy’s details so that they can claim the death benefit when they are ready.