Is Your Life Insurance Enough to Cover Funeral Costs?

Prices of everything is just expected to rise no matter what. Day-to-day expenses rise, same as big-item purchases like cars, and real estate every ten years or so. That’s inflation at work.

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Of course, along with everything else, funeral costs are also rising quickly. But you can take care of funeral and memorial details now so that your loved ones won’t have to pay more later. You love your family so much that you don’t want them to feel any burden and you’re such an organized person you don’t want any sort of trouble for them when you spend your last days on earth.

Planning your own funeral or making plans anything related to that can be a little uncomfortable. But, as Benjamin Franklin said, “In this world, nothing can be said to be certain, except death and taxes.” Leaving your loved ones without the added stress of financial uncertainty can be the greatest legacy you can leave behind.  

Is your life insurance enough?
Most insurance plans aren’t. Keep in mind that funeral costs don’t include the cost of a cremation or the cemetery plot and marker or any other memorial expense. Though the answer to this question may depend on which plan you go for, most insurance policies are designed to ease the family’s financial burdens.  

When will you benefit from the policy?
A scenario could be your husband is dying of an illness, you’ve been staying in the hospital for months now, your life savings are almost drained away, and you have funeral preparations on top of everything else. This is where your life insurance policy comes in handy. The policy will cover the costs of a funeral with life insurance proceeds. Just make sure you know when. Insurance companies vary on how long it takes to pay benefits. So better check the policy or contact the company and ask for all the information you need so you can plan your budget accordingly. Also, most life insurance companies hold the payouts for as long as two years if the cause of death is questionable or if it involves further investigation, like suicide or any criminal involvement so be sure to note those details down.  

What to do if the insurance does not cover all these expenses?
You found out that the life or medical insurance that you have doesn’t cover most expenses involved in the funeral. You may consider advising any of your family members to do some of the following:

• Ask your local government. They may have an agency that can help you cover some expenses or even help you out in kind, e.g., a place of the funeral, food, etc., but it always depends on the deceased or family members’ eligibility requirements.
• Seek for a non-profit local funeral or memorial society. They may provide you with inexpensive options and information on payment assistance. Usually, they do help protect consumer’s rights and keep down inflated funeral costs.
• Make use of veteran’s benefits. If the deceased was a veteran, some burial and memorial benefits may be available. Most of the time, the government will pay for all of these expenses.

What are the expenses? Most of us may ask, how much does one need to have a decent funeral? It can be costly but with proper research and preparation, death-related tasks can go smoother and even be more cost-effective. Things like consumer rights and familiarization with the process and necessary expenses can save you money. Here are some tips you can follow to cut down on some expenses:

• Preplanning. Planning ahead while not in a time of emotional distress will allow you to make more intelligent choices involving funeral costs. If you estimate these costs early, you can review all these to approve them before signing a contract with any funeral service. Your list may include flowers, music, church, etc. In that way, you can always pay in advance and generally in installment payments.
• Constant communication. Always to your local insurance agent on a regular basis to ensure the expenses covered. You can also discuss the payout procedure and dates when the life insurance policy money will be available.

In any big decisions in life, even if it’s about death, it’s always good to have a lot of options and to plan ahead. This way, you no longer have to worry if your coverage will be enough or not because it will be.  

Author's box
Ian G. Elbanbuena is a blogger and infopreneur who writes on various topics mainly finance, self-improvement, business and marketing. At present he works on behalf of Compare Hero, Malaysia's leading comparison website. This portal helps individuals in saving money by comparing rates of personal accident insurance. Twitter: @elbanbuenaian