Burial Insurance For Young Adults

Written by Jeff Root

When you are a young adult, you are just starting out with adulthood. This means a 9 to 5 job for many, paying off student loans, finding a future spouse, and striking out on your own.

This does not leave a lot of room for those long term considerations like retirement or life insurance.

That said, burial insurance for young adults might be something worth considering especially if you only want to cover funeral costs and immediate debts.

What is Burial Insurance?

So, I’m sure you are asking, “what is burial insurance and why is it important?”

Burial insurance is a type of life insurance policy that is meant to cover the costs of your funeral or other burial expenses when you die.

Being young, this probably isn’t something that ever crosses your mind, but the reality is, death is one thing we all face.

And believe it or not, it’s expensive.

The average funeral in the United States costs anywhere from $7,000 to $12,000 when all said and done. If not considered, the cost of an unexpected funeral can cripple a family financially, not to mention the grief.

Do Young Adults Need Burial Insurance?

Even if you do not have a spouse or children dependent upon you, if something were to happen to you at a young age, perhaps your parents would not be in a situation to cover the costs.

For just under $20 per month, a young adult can get coverage on small policies that are adequate for funeral expenses.

Consider your debts. If you have any outstanding debt from things like student loans, you will need money to pay that off.

Do not burden your surviving parents or spouse with that when you can avoid it for the cost of a single lunch out each month.

Moreover, you might have more than just a student loan as a young adult. You might buy a house in a few years, and then be saddled with a mortgage. If you were to pass away, that remaining mortgage debt falls into the hands of your family.

Are there situations where young adults do not need burial insurance?

Sure.

If you are debt free and your parents are made of money, you are not married, and literally, there is no financial strain on any extended family members, then sure, avoid the insurance coverage.

But for most people, this is not the case.

What About Term and Permanent Life Insurance Policies?

Term life insurance policies are issued for a “term”, meaning a specific amount of time. These are often increments of 10 years, such as 10 year terms, 20 year terms, or 30 year terms.

Short term they are a much more affordable life insurance policy rather than a universal policy and at their expiration, you can typically convert them into another policy.

Permanent life insurance policies offer coverage for life. This includes subtypes of insurance, like Universal Life, Variable Life, Indexed Life, Guaranteed Acceptance, and more. Permanent life insurance policies accumulate cash value over time, some through investment vehicles, others through the company’s portfolio. This cash value can be borrowed against interest free.

To go into depth about these policies would take far too long, and get away from the topic of this article, but you can learn more about the types of life insurance from our blog.

A few hours of reading and educating yourself now on the benefits of life insurance and the different types could really help later in life.

Comparing Burial Insurance to Term and Permanent Policies

But when is burial insurance a better fit than term or permanent policies?

Well, like we said earlier, burial insurance is a great place to start with insurance.

Why is burial insurance good for young adults?

Well, it is a small amount of coverage, that is generally very affordable, and provides for the only type of expense you are guaranteed to need after your death.

For this reason, it makes a lot of sense to purchase a burial insurance policy for young adults.  As later in life, you can add term or whole life insurance coverage from another provider.

How Much Burial Insurance Do I Need?

Burial insurance policies vary in amount, but they are generally lower face amount policies, between $5,000 and $25,000, with a few providers offering burial insurance for young adults up to $50,000 and $100,000.

Once you die, the money goes to your beneficiary who can use it how they see it. If, for example, you get a $25,000 burial insurance policy and your funeral costs amount to $10,000, then your beneficiary can use the remainder to pay off any debts you owe, legal costs, medical bills, etc…

Burial insurance is the better option for those who do not need a large policy fit to cover living expenses for dependents. Again, if you are single and have no children or parents dependent upon you, it might be wasteful to contribute monthly to a $100,000 policy when your costs upon passing will only amount to $10,000 or $15,000.

How Much Does Burial Insurance Cost?

Whether you want a term plan, universal plan, or just standard burial insurance, you can compare now. Your age is the single largest factor when determining how much coverage you need and what your costs will be.

Buying coverage in your 20’s is much cheaper than in your 50’s or 60’s. By the time you are 60, your life insurance rates may be 3 or more times higher than they are in your 20’s The next thing companies consider is your health, including pre-existing conditions and your current health right now.

You can afford, at a young age, to spend a few months getting healthier overall and reducing things like cholesterol and blood pressure, trimming your waistline, and decreasing your chances of things like heart disease or diabetes down the line.

That said, the best way to get top-notch rates is to compare companies and choose the one best for your situation. Get quotes from a handful of companies before you choose one because they each view applications differently.

Sample Costs for Life Insurance for Young Adults:

Below are some examples for male and female policy costs, based on a few different criteria. They all reflect a Preferred Plus policy, which is the highest policy you can find with the biggest coverage.

Below is a chart displaying the life insurance rates for a 23-year old male and female non-Smoker, with preferred plus health rating.  These figures are for a 10 Year Term policy with $500,000 of coverage:

Company Male Female
Protective $14/mo. $12/mo.
AIG $14/mo. $13/mo.
Banner Life $17/mo. $12/mo.
Sagicor $21/mo. $16/mo.
Phoenix $56/mo. $46/mo.

Now, these are all samples for incredibly expensive plans, the ones that give you lots of coverage and would be useful for offsetting costs to any dependents.

But what if you had none? What if you only wanted to have money for funeral costs and burials? Well, then a cheaper plan is, well, cheaper:

For a comparison, this chart shows the cost of burial life insurance for 23-year-old male and female.  This is the cost for $25,000 of whole life insurance coverage.

Company Female  Male 
Mutual of Omaha $7/mo. $8/mo.
American National $9/mo. $10/mo.
Sagicor $7/mo. $8/mo.
Phoenix $11/mo. $10/mo.

Please note that all of the rates shown are general estimates for Preferred Plus plans. They are not offers or legitimate illustrations based on your situation. You must contact representatives or use a comparative insurance plan to receive more accurate options.

Finding the Best Burial Insurance Rates for Young Adults 

When searching for life insurance at any age, it can be overwhelming trying to understand the options available to you.

Life insurance is cheaper while you are young, and makes sense as a long-term investment.  So you should not let the difficulty of finding life insurance stifle you.

The best thing you can do to make the process easy, educational, and stress free is to speak with an independent insurance agent who can compare doznes of rates from dozens of companies to help you find the exact life insurance coverage that is best for you and your family.

Give us a call today to speak with an agent for free, or begin comparing rates for burial insurance right here on our site!

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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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