your health is the main factor for determining your cost for burial insurance

How Is the Cost of Burial Insurance Determined?

The cost of burial insurance is determined by a few key factors, including health, type of policy, age, gender, time of enrollment, tobacco usage, and the company itself. 

Health Is Main Factor

Like all life insurance policies, burial insurance takes your health into consideration when determining your costs. However, this process looks significantly different than with other policies.

Unlike most life insurance, burial insurance allows for individuals with serious, terminal, and preexisting conditions. This includes diabetes, cancer, stroke, heart disease, Alzheimer’s, and much more. There are two different types of burial insurance that will determine your costs—simplified issue and guaranteed issue.

Your Cost with Simplified Issue Burial Insurance

Using a process known as medical underwriting, simplified issue burial insurance takes basic health knowledge to determine your eligibility and cost. What is medical underwriting? It is an incredibly simple questionnaire that can be filled out in minutes. All you have to do is answer “yes” or “no” to these questions:

  • Have you been diagnosed, treated, tested positive for, or been given medical advice by a medical professional for: 
    • Congestive heart failure?
    • AIDS, AIDS Related Complex, or HIV?
    • Lou Gehrig’s disease?
  • Within the past 12 months, have you been recommended to use, or have you used, oxygen equipment to assist with breathing?
  • Are you using a wheelchair or electric scooter due to an ongoing diagnosed illness, medical condition, or disease?
  • Are you a resident in, or have you been advised to move into, a nursing home or skilled nursing facility?

Your Cost with Guaranteed Issue Burial Insurance

What is the difference between simplified and guaranteed issue? Unlike simplified issue, you can skip the entire medical underwriting form with guaranteed issue. In fact, your health is not taken into consideration at all. How does this affect your burial insurance costs?

Generally speaking, simplified issue will cost less than guaranteed issue. Because your health isn’t a factor for eligibility, there is a level of “assumed risk” when setting your premium. This means that because you were unable/unwilling to pass the medical underwriting process, you likely have a health condition that means you are at risk of passing away sooner than if you had been eligible for a simplified issue plan. Because burial insurance is permanent until the policyholder passes away, the longer you live, the more time you’ll have to pay premiums. 

This is by no means a fun topic. Talking about death and paying insurance premiums are likely two of the least enjoyable things to discuss. However, you must have an understanding of how your health affects your burial insurance costs.

How Gender Influences the Price of Burial Insurance

Did you know? Men will pay more for their insurance policies than women. Men, on average, live a shorter life than women and are at a higher statistical risk. Because of this, their premiums will generally be higher. 

Miscellaneous Factors that Influence Costs

Apart from these main determining factors, there are a few others that will also influence the price of your burial insurance. Smokers will consistently have a higher premium than non-smokers. Some guaranteed issue policies will, however, make an exception to this rule if you have quit smoking for at least 12 months.

Another small influence on cost is whether or not you opt for a plan without a waiting period. Burial insurance providers may offer very quick signup periods. Some will slightly increase premiums due to this lack of a waiting period.

Age-Based Cost Ratings for Burial Insurance

Another important factor in determining your burial insurance costs is your age at signup. The older you are when you apply and enroll in a policy, the higher your premium.

Why is that? This goes back to the un-fun topics of death and insurance payments. The older you are, the less time you will likely have to make premiums. So, every year you age before signing up for a plan, the higher your premium will be.

The good news? Once you’re enrolled, your premium will never increase. Also, even though your premium will be higher if you enroll later in life, you won’t have to make payments on it for as long.

As a 40-year-old woman non-smoker, for simplified issue you would pay, on average:

  • $12.34/month for a $5,000 policy, $20.05/month for a $10,000 policy, $27.77/month for a $15,000 policy, and $35.48 for a $20,000 policy.

For the same individual but for a guaranteed issue policy, you would pay, on average:

  • $21.67/month for a $5,000 policy, $40.42/month for a $10,000 policy, $59.17/month for a $15,000 policy, and $77.92 for a $20,000 policy.

For a 40-year-old man non-smoker, for simplified issue you would pay, on average:

  • $14.48/month for a $5,000 policy, $24.34/month for a $10,000 policy, $34.19/month for a $15,000 policy, and $44.05 for a $20,000 policy.

For the same individual but for a guaranteed issue policy, you would pay, on average:

  • $26.25/month for a $5,000 policy, $49.58/month for a $10,000 policy, $72.92/month for a $15,000 policy, and $96.25 for a $20,000 policy.

Compare these averages with the averages of 85-year-olds, often the eligibility cutoff for most policies.

As an 85-year-old woman non-smoker, for simplified issue you would pay, on average:

  • $69.55/month for a $5,000 policy, $135.90/month for a $10,000 policy, $202.25/month for a $15,000 policy, and $268.60 for a $20,000 policy.

For the same individual but for a guaranteed issue policy, you would pay, on average:

  • $103.10/month for a $5,000 policy, $204.20/month for a $10,000 policy, $305.31/month for a $15,000 policy, and $406.41 for a $20,000 policy.

For an 85-year-old man non-smoker, for simplified issue you would pay, on average:

  • $93.18/month for a $5,000 policy, $183.15/month for a $10,000 policy, $273.13/month for a $15,000 policy, and $363.10 for a $20,000 policy.

For the same individual but for a guaranteed issue policy, you would pay, on average:

  • $150.43/month for a $5,000 policy, $298.86/month for a $10,000 policy, $447.30/month for a $15,000 policy, and $595.73 for a $20,000 policy.

Get the Insurance You Need with Senior Life Services

With Senior Life Services, you will receive a legitimate, personalized quote for your future burial insurance policy. To speak with our highly-trained, friendly agents, give us a call at 800-548-3249.