The average cost of a funeral in the United States is around $10,000. This amount of money is what many people pay for a car, a down payment on a house, or even a luxury vacation. The difference being, of course, that you have time to plan ahead and save for these types of big-ticket items. If death occurs suddenly or no advance provisions have been made, that’s a huge cost to take on all at once—especially since your own financial future may be uncertain now that you’ve lost a loved one.
Burial insurance (also known as funeral insurance) is the number one way to avoid the burden of funeral costs. By planning ahead and finding a policy that fits both your budget and your lifestyle, you can protect your family for a lot less hassle than you think.
1) Burial Insurance is Highly Flexible
Although it’s called burial insurance, this policy can generally be used any way the beneficiary wants. This means that if your beneficiary decides to change the nature of the burial plans or needs those funds for other estate-related concerns, they’re free to use them however they see fit. From buying caskets and paying off medical expenses to flying out family members for the funeral, there are no rules about how they use the funds.
2) You Can Name the Funeral Home the Beneficiary
While flexibility is nice, it’s not always ideal—especially if you’re purchasing burial insurance to be used specifically for your funeral. One way to avoid your family fighting over the money or putting it to a different use is by naming the funeral home your beneficiary. This is actually a very common occurrence, and allows you to plan (and pay for) your entire funeral from start to finish.
3) There Are Few Health Restrictions
Life insurance policies almost always require a physical exam and will use your medical history to determine what your rates and premiums will be. This is rarely the case with burial insurance. Although the cost may vary depending on your age and health status, it’s much easier for most people to qualify for this kind of coverage.
4) You Can Choose the Policy Amount
No two funerals are exactly the same. Some people prefer to keep things small and simple, while others want to go out in a grand style. There’s no right or wrong way to hold a funeral—or to pay for one. Most burial insurance policies range from as little as $1,000 to up to $50,000, so you can choose the one that makes the most sense for your family and your burial/cremation wishes.
5) Burial Insurance Pays Out Faster than Life Insurance
Life insurance policies can sometimes take months (or even years) to pay out, especially if there are any questions or concerns about the cause of death. This can make it difficult to pay for the funeral, since you have no guarantee of when those funds will be released. Burial insurance is designed to be paid as quickly and efficiently as possible so that you can lay your loved one to rest and focus on what’s really important.
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