While most people do not like the thought of discussing life insurance, the truth is that it is oftentimes a necessary part of one’s overall financial planning process. This key tool can help in protecting the finances of loved ones and survivors – and it can also often be the only thing that stands between being able to move on, or a future of financial hardship.
Life insurance can be purchased for many reasons. For some, it is to pay large estate taxes that are due upon the death of the insured. For others, it can be to provide an ongoing income for survivors in the event of an unexpected death of an insured who has a spouse or partner and young children to support.
In nearly all cases, though, an individual will have some type and amount of final expenses. These can include a multitude of items, such as one’s funeral service, burial plot, headstone, transportation, flowers, and other related costs.
Today, the cost of an average funeral across the United States can be in excess of $10,000 – an amount that many families and loved ones just simply do not have. And, because payment is often due at the time that service is rendered, loved ones of the decedent are often forced to dip into their savings or retirement assets to pay these costs. Sometimes, they may even need to put these costs on credit – which can ultimately make the expense even higher, given the high amount of interest that is charged.
There is, however, a solution that can help to relieve loved ones of having to scramble for funds and endure additional financial hardship – especially at an already difficult time in their lives. This is in the form of a burial policy.
What is Burial Insurance and How Does It Work?
Burial insurance is a type of life insurance coverage that is purchased specifically for paying for one’s funeral and other related expenses. This type of coverage can also be referred to as final expense insurance or funeral insurance.
Unlike most types of traditional life insurance plans, burial insurance policies will typically cap the amount of benefit to $25,000 or $30,000 – although there are some insurance carriers that offer higher amounts.
A burial insurance policy can provide loved ones with access to the funds that are needed quickly for paying funeral and other related expenses upon the death of an insured. These funds may also be used for paying off other debts as well, such as credit card balances, and uninsured medical costs.
Having such a policy can provide loved ones with the peace of mind in knowing that they will not have to use retirement savings or sell precious assets for the purpose of coming up with needed funds should the unexpected or the inevitable occur.
Burial insurance is typically offered to those who are age 80 – and in some cases, carriers will offer this coverage to applicants who are older. Coverage will usually last until the insured reaches the age of 100.
There are different manners in which the death benefits on a burial insurance policy may be paid out. In some cases, the policy may pay what is referred to as graded benefits. In this case, if the insured should pass away within the first year of owning the policy, the beneficiary would receive 25 percent of the amount of the stated death benefit.
If the insured dies within the second year of policy ownership, the beneficiary would receive 50 percent of the stated death benefit amount, and if the insured should die within the third year of policy ownership, then the beneficiary would receive 75 percent of the stated death benefit amount. However, should the insured live through to the fourth year or longer, then the beneficiary would receive 100 percent of the amount of the death benefit when the insured passes away – whenever that may occur.
Another death benefit option on burial insurance policies is for the insurer to pay the beneficiary only the amount of premiums that were paid in (and possibly a certain amount of additional interest) if the insured should die within the first two or three years of policy ownership.
While these death benefits may not seem to offer a large amount to the beneficiary – and in some cases, they may not even cover the total amount of the insured’s final expenses – this type of insurance can at least provide some amount of coverage to individuals who may otherwise not qualify for any other type of life insurance protection at all.
Comparing Burial Insurance to Traditional Life Insurance
Although in many ways burial insurance appears to work like a traditional life insurance policy, there are some distinct differences. One of the key differences comes in the underwriting requirements.
For example, with traditionally underwritten life insurance policies, an applicant is typically required to fill out an application for coverage. This application will usually ask for a great deal of detailed information regarding the individual’s health, as well as his or her health history. Also, the applicant will usually be required to undergo a medical exam.
This exam typically entails the taking of a blood and urine sample. These samples are tested for various health-related factors that could pose risk to the insurance company. If it is determined that the applicant has certain types of health conditions, then he or she may be declined for coverage, or be placed into a high risk policy class and charged a higher rate of premium for their coverage.
With a burial insurance policy. However, the application process is often very different. First, the underwriting requirements are in most cases much less stringent. While approval is usually not guaranteed, applicants are not required to undergo a medical exam. This can be a real advantage to someone who has an adverse health condition and would otherwise not likely qualify for a traditionally underwritten life insurance policy.
Burial insurance is also usually much more affordable than traditional life insurance coverage, making it ideal for high risk policy candidate such as diabetics looking for life insurance. In most instances, burial insurance is a permanent form of coverage. This means that the premium will typically be locked in and guaranteed not to increase throughout the life of the policy – and the coverage will also remain in force, provided that the policyholder continues to pay the premium.
Who Should Purchase a Burial Insurance Policy?
Life insurance is an integral part of most people’s overall financial plans. Therefore, it is essential that it is considered by most individuals – especially those who have loved ones who are counting on them.
If you don’t want to leave those you love with debts and financial hardship, then it is important that you consider a burial insurance policy. These plans should be considered by those who either do not already have coverage, as well as by those who may have difficulty in qualifying for traditionally underwritten life insurance policies, as it could provide an avenue for obtaining the protection that you need.
This type of coverage should also be considered by those who may have lost their life insurance coverage due to a job loss, or for other reasons. The important thing is that you not leave loved ones vulnerable to having to pay the high cost of final expenses should the unexpected occur.
Where to Find the Best Burial Insurance Premium Quotes
When shopping for a policy, the best way to find the best life insurance premium quotes is to work with either a company or an agency that has access to more than one insurance carrier. In doing so, you will be able to more directly compare the policies, the benefits, and the prices that are charged – and then you can determine which will work the best for you and your specific needs.
If you are seeking burial insurance quotes or information, we can help. We work with many of the top life insurance companies in the U.S. and we can assist you with attaining all of the pertinent details that you may need for making a well-informed purchase decision. We can get this information for your quickly and easily – so that you can have the coverage that you need much sooner. When you are ready to move forward, all you need to do is fill in the form on this page.
Should you find that you have any additional questions regarding burial insurance, life insurance, or how to obtain a premium quote, please feel free to contact our experts.
We understand that the purchase of life insurance may not be the first thing on many peoples’ minds. It is essential for ensuring that the ones you love the most are protected – just in case. So, contact us today – we’re here to help.