What is Burial Insurance?

Burial insurance, often known as funeral insurance, covers your funeral and burial expenses. It is a type of whole life insurance that covers you till the age of 100 years. In fact, while buying burial coverage insurance, you don’t have to undergo a medical examination.

Nowadays, the cost of funerals is rising, and having funeral insurance helps your family because they don’t have to bear the expenses of your burial. This type of plan is available for those between the ages of 50 and 80. It is an ideal plan for those who may not have savings or other life insurance coverage.

How Does Burial Insurance Work?

• Puneet is a 50-year-old male who bought burial insurance and chose his wife as a beneficiary.
• It is a whole life plan that covers him till the age of 100 years.
• In the 10th policy year, Puneet passes away due to an accident.
• His wife informed the insurer to begin the claim process following the death of the insured.
• To do so, she has to submit IDs along with a claims form, as well as a certified copy of Puneet’s death certificate.
• Once the claim is settled, the insurer will credit the coverage amount to his wife’s account to cover the funeral cost.

What Does a Funeral Insurance Cover?

Funeral insurance covers the cost of your funeral and burial expenses in the event of your death. In fact, there are no restrictions on how your nominee uses the payout money.

Funeral insurance payout can be used for:

• Funeral arrangements
• Burial costs
• Cremation expenses
• Hospital bills
• Outstanding liabilities
• Legal costs

Once your nominee uses the payout amount to pay for your funeral expenses, there may not be much left for them. If you want to protect your family financially after you pass away, you can opt for a term insurance plan.

Pros & Cons of Burial Insurance

Here’s a look at some pros and cons of burial insurance.

Burial Insurance Waiting Period & Eligibility Criteria

Generally, burial insurance has a waiting period of 2–3 years, but you can purchase it regardless of your health or pre-existing disease. However, the waiting period may vary by insurer and plan you opt for. The insurer will only refund your premiums on your demise within the waiting period. This type of plan is typically available for those between the ages of 50 and 80.

Difference Between Term Life Insurance and Burial Insurance

Does Term Life Insurance Cover Funeral Costs?

Term life insurance offers high life cover in exchange for affordable premiums. Upon your untimely demise, the life cover amount as death benefit shall be payable to your nominee. So the payout amount can be used to cover funeral costs. A lot may be left for your nominees to maintain daily life expenses or pay outstanding liabilities. If you already have a term plan, you may not need a separate burial insurance policy.

Conclusion

To ensure that your funeral costs are covered no matter when you die, you can opt for burial insurance. This is a whole life insurance policy that lasts until your death. You can even consider opting for a term plan to replace your income if you die before retirement and a burial policy to cover your funeral expenses, no matter when you die.