Is Burial Insurance Worth It?

Is burial insurance worth it since there are other life insurance products that feature greater coverage? If you still need income replacement or have large loans out like a mortgage or auto loan, you may require larger coverage. But if you’re a senior who is already retired, don’t have a significant financial responsibility, and are looking for a way to provide funds to pay for your funeral, a burial insurance policy may be a good fit.

Senior Life Services Is Burial Insurance Worth It?

How is burial insurance worth it?

Because there’s no medical exam involved, those who are older or suffer from some health issues are able to protect their families from the rising costs of funerals and burials. This peace of mind is what many seniors look for and would argue that it’s very much worth the premium they pay.

Alternatives to burial insurance

Is burial insurance worth it if you can just pre-plan your funeral? Let’s take a look at that and other alternatives: 

  • Pre-need insurance — This is essentially a pre-paid funeral. Pre-need funeral insurance is a type of permanent life insurance offered by funeral homes. There is some downside to these policies.  A funeral home can change ownership, there may not be a way to change your mind and go with a different funeral home, and the funeral home, not your family, is the beneficiary of these policies. 
  • Pre-need funeral trust — Serves the same purpose as pre-need insurance. This trust accrues interest over time but the interest is typically taxable and they’re irrevocable. 
  • Self-funded burial — If you’re financially prepared for retirement, you may already have the money you need to afford your funeral. But this isn’t an option if you’re already in your golden years. It needed to be something you’ve been working on so you don’t leave your family unprotected in the event of your death. 

As you can see, there are a number of options available. But perhaps the most flexible and easiest choice is a burial insurance policy. Also known as final expense, this policy’s benefit can be used to pay anything, the money goes to a beneficiary of your choosing, and gives you the flexibility of always choosing your final arrangements.

Easiest route to coverage

Sometimes seniors have very few options when they are older and not in their best health. Final expense policies are made especially for this group. There is usually no medical exam required and have just a questionnaire. The length of this questionnaire depends on the type of policy you qualify for but there are options for “high-risk” individuals with burial insurance. 

This type of burial insurance is called “guaranteed issue” and is a little more expensive than most policies (called simplified issue) but, as long as you don’t currently have a terminal illness, you’ll still receive coverage.

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