If you’d like to provide a way for your loved ones to pay your funeral and other end-of-life expenses, a burial insurance policy may be just what you need.
Here are some frequently asked questions that may help you find out if burial insurance is a good fit for you:
What Is Burial Insurance?
Burial policies are life insurance policies that are customized to make them ideal for paying funeral expenses and other bills that you may leave behind when you die.
How Is Burial Insurance Different From Life Insurance?
Let’s first define life insurance before talking about how burial insurance is different.
When you buy life insurance, you pay a regular premium in exchange for a cash sum that will be paid to your loved ones if you die when the policy is in force.
Burial insurance is different because…
- You can get a much smaller amount of coverage: Life insurance policies can carry $1 million or more in coverage. Burial policies can range from $1,000 to $25,000 with some companies offering up to $40,000. This lower range of coverage options means you can get just what you need and pay much less in premiums.
- Your health isn’t as big a factor: Life insurance premiums are usually based on your health. The healthier you are, the more likely you’ll qualify for coverage and get a favorable rate. With burial insurance, the underwriting process looks much more favorably on health issues. Also, there’s no need for a medical exam. Your insurance company will categorize your application based on your questionnaire. (More on this below.)
- Your policy won’t expire: Many life insurance customers opt for term coverage, which lasts only until they reach a certain age. Burial insurance remains in place as long as you pay the premiums. That way you don’t have to worry about outliving your coverage.
If this sounds like a product that meets your needs, keep reading to learn more about the specifics and how you can get covered as soon as possible.
How Does A Burial Insurance Policy Work?
Just like with any kind of life insurance, you pay regular premiums in exchange for your burial insurance coverage which will be paid to your beneficiary when you die.
So, if you died with a $25,000 burial policy in place, your spouse, your child, or whomever you choose as your beneficiary can file a claim and receive the $25,000 in cash, tax-free.
The money can be used to pay the funeral home and to pay any other final expenses that you leave behind, whether they’re medical bills, utility bills, credit card bills, etc. Your beneficiary can use the money any way he or she deems necessary.
If there’s money leftover, your beneficiary can decide how to use it: a donation in your name to your favorite charity or to make some improvements to your house in order to sell it, for example.
Will My Health Make Burial Insurance Too Expensive?
Anyone who’s bought life insurance knows that your health has a direct impact on your premiums. In some cases, life insurance applicants can be denied because of pre-existing health conditions.
Burial insurance applicants will answer questions about their health, but only so your insurance company can decide which of three categories you fit into:
Also known as “preferred” at some companies, this category means you’ll be paying the lowest price for your coverage. In most cases, applicants in this category often have answered “no” to most, if not all, of the health questions on the application.
If you answer “yes” to some of your insurance company’s health questions, you may fall into the graded benefit plan.
The word “graded” refers to the payout: If you died within the first year of coverage, for example, your beneficiary may receive only 30 percent of your coverage amount. During the second year, that number might increase to 60 percent. In the third year of coverage, your policy would pay out the full amount.
These percentages vary among different companies. Some may pay as much as 75 percent during the second year while others may pay only 50 percent. If you fall into this category, it’s a good idea to compare how companies break down, or “grade,” their graded benefits.
A company’s highest risk applicants fall into this category. If you bought a modified plan policy and died within two years, your beneficiary would not receive your coverage amount. Instead, he or she would receive the premiums you had paid, plus interest.
Modified plans are forms of burial insurance, but if you fell into this category, you’d be better off buying a guaranteed life insurance policy. They’re cheaper than a modified burial policy and they don’t ask any health questions.
Am I Too Old Or Too Young To Apply For Burial Insurance?
You can apply for burial insurance at any age, and generally speaking, younger applicants pay lower premium rates. That being said, some companies do restrict their products based on your age.
The “sweet spot” for burial insurance is between the ages of 50 and 85 since that’s generally when most clients apply for coverage. Each state also regulates insurance differently, so not all insurance products are available in all states of residence.
But we can usually find a suitable product for any client who wants coverage to protect their families from unexpected expenses when they die.
How Much Should I Expect To Pay For Burial Insurance?
This is all great information, but wouldn’t it be nice to know some hard figures? Of course, when get quotes, you’ll be able to see and compare rates from different companies. But you can still get a ballpark idea about premiums for burial insurance.
Keep in mind that your state of residence and health status will be factors.
The following numbers are based on a level plan (not graded or modified) and are for people who do not smoke and want $10,000 in coverage:
|Female (50)||About $25|
|Female (65)||About $41|
|Female (80)||About $100|
|Male (50)||About $30|
|Male (65)||About $55|
|Male (80)||About $130|
You get the idea but remember: rates for burial insurance policies do not increase. So if you bought a policy at age 55, for example, you’d keep that same rate throughout the life of your policy, regardless of your age.
You can use the quote box at the top of this page to get a customized quote that meets your coverage amount and age.
What Diseases Would Disqualify Me For Burial Insurance?
Believe it or not, it’s hard to not qualify for burial insurance. If you think about it, it makes sense: Burial insurance is a product designed for people who are older and are more likely to have health issues.
So regardless of your pre-existing conditions, you should still be able to find a policy that meets your needs.
This is true even if you have the following conditions:
- High blood pressure
- High cholesterol
- Type 1 diabetes
- Type 2 diabetes
- Diabetic neuropathy
- Diabetic nephropathy
- Diabetic retinopathy
- Heart attack over a year ago
- Full blown strokes over a year ago
- Cancer over 2 years ago
- Mini strokes
- Blood clots
- Arthritis (all kinds)
- COPD, emphysema, and chronic bronchitis
- Hepatitis A, B, or C
- Chronic kidney disease
- Parkinson’s disease
- Multiple sclerosis
- Seizure Issues
- Sleep Apnea
- Non-cancerous tumors
If you have a terminal illness, it will be harder to qualify, and you may be better suited to find a guaranteed issue policy which will not seek information about your health.
Why Can’t I Just Get Life Insurance To Cover Final Expenses?
This is a good question. Since life insurance also exchanges premiums for cash payouts in case you die, why couldn’t you just use a regular life insurance policy?
The short answer: You can. Which leads to a better question: What’s better about a burial policy?
To explain this, let’s think about car shopping. If you need a vehicle to get across town several times a week and never plan to haul a boat or to help a buddy move, there’s no reason to buy a full-size pickup truck. A mid-size sedan will do the job, will cost less, and will use less gas.
Similarly, burial insurance policies are smaller and more affordable than traditional life insurance policies, and they’re set up so that the underwriting process is favorable to people who have illnesses and are older.
What If I Already Have Life Insurance? Do I Also Need Burial Insurance?
If you already have a life insurance policy, it’s possible that you may not need to add a burial policy. But be careful: This question can’t really be answered unless you know what kind of life insurance policy you have.
If you have a term policy and you live beyond the length of your term (which is great, right?) you could find yourself without coverage. For example, if you bought a 20-year policy when you were 40, that policy has probably done a great job keeping you covered. But if you’re approaching your 60th birthday, that coverage will not be there much longer.
When the term ends, your coverage will end, too. You could buy another term policy, but doing so at age 60 would be much harder than it was when you were 40 because rates favor the young.
And, you may not need a full-blown life insurance policy at age 60. Maybe you’ve saved some money? Maybe your kids are grown and financially independent?
If this is you, then a burial policy may provide just enough coverage for your current needs. When you’re shopping around, be sure to get a burial policy that’s permanent and not one that’s term-based and could expire at a later date.
If you already have a whole life policy, which is a permanent life insurance policy, you may also want to reconsider your coverage if you’re getting older and no longer need the amount of coverage you have in place. This is a question best posed to your financial advisor since whole life policies usually include an investment component.
How Do I Apply For Burial Insurance?
Compared to a regular life insurance policy, applying for a burial policy is much simpler.
- There’s no need for a medical exam: Instead, you answer a series of questions about your health.
- There’s no need for paperwork: In most cases, the underwriting process happens electronically. With your consent, the insurance company will check your medical records. You won’t need to ask your doctor or pharmacist to fill out any forms.
- You won’t have to wait long for a decision: Since the application process happens quickly with most companies, you will get a decision on coverage on the same day you apply.
We work with leading providers of burial insurance such as Forester’s, Assurity, Gerber Life, American National, Mutual of Omaha, and Voya Financial to make sure you have the best options available for coverage.
However, most of these companies do not sell burial policies directly to customers, so you’ll need to go through an independent agency such as burialinsurancecoverage.com.
So call us at 512-900-7633 or start by getting your instant quotes here.
Here’s what we’ll do:
- Enter your gender, date of birth, state, and coverage amount into our software which will communicate with the leading providers of burial insurance.
- We’ll go through the possible policies starting with the least expensive. We’ll gather the most affordable policies that you can qualify for.
- You can decide whether you want to apply for the coverage.
The Right Coverage At The Right Time
Isn’t it great when something just fits? Like when your house is just the right size for your family or when the suitcase you’re packing has just enough room for your stuff?
With insurance coverage, having too much can mean you’re paying more than you should be and having to sacrifice in other areas of life. If you have too little coverage, your loved ones may not have the money they need to pay the funeral home and your other final expenses when you pass away.
For many people in their 50s and older, a burial insurance policy provides just the right balance: the coverage to pay those final expenses without the expense of a larger life insurance policy.
When you have this kind of coverage in place you can achieve another kind of balance. You can stop worrying about how your loved ones will pay your final expenses and get back to enjoying life. Let us know if we can help.