How Does Burial Insurance Differ By State?

Written by Jeff Root

Believe it or not, there are a lot of laws regulating how you and you estate are treated once you die. These regulations affect burial insurance, final expense insurance, and pre-need burial plans.

Each state is slightly different in the way a person is treated after they pass away.

California is one of four states with restrictive burial laws. According to California law, anyone who “deposits or disposes of any human remains in any place, except in a cemetery, is guilty of a misdemeanor and could face jail time or a fine up to $10,000.”

Many states require the participation of a funeral director in the burial process regardless of where the person is buried.

It’s the required participation of the funeral director that can affect the cost of a funeral, as well as the way insurance, works for funerals.

Read More About Burial Insurance Plans In Your State

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How Can You Find Out More About State Burial Insurance Laws?

Understanding your state laws for burial insurance can help you plan for the future. The funeral industry has created multiple products directed toward end of life expenses. Some are good and some are bad. Knowing your state laws can help you avoid a bad financial decision.

A local family attorney or even your state representative can explain the impact of your state burial laws on end of life planning.

Our agents are trained in your state regulations and are a resource as you plan for your family’s future.

State Laws for Prepaid Burial Plans

Because of the requirements surrounding funeral directors in most places, the funeral industry created a life insurance product. Surprisingly, some states allow this product to be sold by the funeral home without the need for a licensed insurance professional.

This life product is often referred to as a Prepaid Burial Plan.

Here are the details:

  • Prepaid Burial Plans are actually a whole life product sold by funeral homes.
  • Some states will require you to name the funeral home or director as the beneficiary of the product.
  • Because it is a whole life product, it contains a growing cash value component. Many states will allow the funeral home to withdraw the increasing interest on the cash value each year.
  • Benefits are limited to specific funeral homes.
  • Sold as a method to lock in funeral costs. Funeral costs have been doubling ever 10 years.
  • Not portable. If you move states, you not be able to take the plan with you. Some states like NY and NJ do protect residents from this problem

Prepaid Burial can be an effective way for you to prepare your family financially for the cost impact of final expenses. Funeral costs continue to rise faster than any other segment of American society. As expensive as healthcare and education have become, funeral costs have risen much faster.

Is Prepaid Burial Insurance Better Than Burial Insurance?

The problem with Prepaid Burial Plans is freedom.

There is no freedom.

You can’t choose the beneficiary

Your family will not get the death benefit of your burial plan, the funeral home does. While this makes planning for burial easy to cover in terms of preparation, it can make additional expenses hard to account for, and does not allow for a versatility in the way the death benefits are allocated.

You can’t choose any extra coverage options

With pre-need burial plans, there are no add-ons or riders like traditional burial insurance and other life products. Most burial insurance products come with critical illness options and even accidental death insurance.

You can’t choose where the money goes

The money from your death benefit will go only to the prepaid funeral home. There is no guarantee that you will get your money back if you move states or the funeral home goes out of business. Maybe you want a portion of the money to go to charity or as a gift to family members. That will not happen. Maybe the health costs of dying are higher than burial costs, your family won’t be able to divert funds to that expense.

It sounds restrictive, doesn’t it? Doesn’t it make you feel trapped?

There is a better option…Burial Insurance.

What is Burial Insurance?

Burial Insurance is specially designed life insurance product designed for your family to use for your final expense costs. Because it is life insurance, you are in control.

You choose the beneficiary. Your family, not a big business, chooses where to spend the money. The policy is not restricted to the state you live. You can take anywhere.

Burial Insurance is a type of permanent life insurance. Within the world of life insurance, there are two basic types of policies–term and permanent. Term life is temporary. It is life insurance with an expiration date. Permanent life insurance is exactly like it sounds—permanent, covering your whole life. Not only is it permanent, but it provides a bank of cash value that grows over time.

Burial Insurance is permanent. The coverage typically lasts until age 121, but can vary depending on the insurance company, policy, and State of residence.

Features of Burial Insurance:

  • Designed for people ages 45-85
  • Coverage available between $2000-$50,000 – This is enough to cover your final expense and provide gifts to your family
  • Level Premiums. Premiums won’t continue to increase over time
  • Accelerated Death Benefit options – If you are diagnosed with a terminal illness, you can receive the benefit immediately
  • No Medical Exam required – Your health will not prevent you from having coverage. No pins or needles or doctor visits.
  • A Bank of Cash Value – Your premium will not only provide life coverage but grow over time. If emergencies arise, you can borrow against that cash. If the cash grows large enough, many policies will allow you to use the cash to pay the premium.
  • Portable – You can move states every year, and your policy will follow you

Burial policies are an easy investment providing financial security for your family and loved ones.

How Your State of Residence Affects Burial Insurance Rates 

Here’s a quick example of some typical burial insurance rates we can find for you. Obviously, the State you are from will affect burial insurance rate. However, this only affects burial insurance rates on a very small level for people in a few states. People in states such as New York, Washington, and California have some of the strictest burial laws, which can affect burial insurance rates.

For the most part, burial insurance rates stay similar throughout all States. The main thing you need to worry about when it comes to States and burial insurance is the laws that govern what is required and allowed to be provided by burial insurance policies. In some States, a limited amount of coverage may be available.

The table below shows some sample burial insurance rates for a few different age groups.

Age / Gender Coverage Monthly Premium
50 yr old Female $10,000 $25
65 yr old Female $10,000 $41
80 yr old Female $10,000 $100
50 yr old Male $10,000 $30
65 yr old Male $10,000 $55
80 yr old Male $10,000 $130

As you can see, burial insurance is an affordable investment for your family’s future. And you are not paying for more coverage than you need. Burial insurance covers you for life in every State and helps to ensure that you have the protection you need in the event of your death.

For people with health conditions, rates can change a bit, however, because burial insurance is largely made for people with health conditions, and most policies are graded death benefit policies, burial insurance rates vary most based on your age more than anything.

How Can You Find the Best Burial Insurance Rates in Your State?

There are hundreds of life insurance companies that offer burial insurance. Sometimes you see it marketed as funeral expense coverage, or even as guaranteed issue whole life.

Each company will have their own options and restrictions. Coverage can vary between each company. One carrier may increase coverage over time. Another company may have stable coverage from day one of the policy purchase. There are even companies who will increase premium as you get older. When you need it most, and when family budgets are smaller, their prices are higher.

You could spend months sorting through the companies and options available to you.

We are an insurance broker and have done the work for you. We don’t represent only one company. We won’t recommend a company because it is the only one we have. We won’t offer you a policy because it is good for us and not you.

As a broker, we work for you. We gathered the best burial policies in the industry under one place. Depending on your situation, we can recommend the companies suited to your needs.

Let Us Help You

If your state requires you to use a funeral director, like most do, compare your options before you are talked into a pre-paid funeral product.

There are other options with more coverage and greater flexibility for your family.

We have contracted with the best insurance companies to provide you with the most coverage at the most affordable costs to you.

Contact one of our agents, so they walk you through the best options we have found for you.

About Burial Insurance Coverage
About Burial Insurance Coverage

We work with individuals across the nation to secure the best life insurance rates.

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