VWB Blog The average funeral in America costs somewhere between $6,000 and $8,000.
Losing a loved one is already heartbreaking. The last thing you want is for your family to struggle financially to pay your final expenses.
Burial insurance helps everyone focus on grieving rather than money. In this case, they’re indispensable. But burial insurance may not be suitable for everyone.
Read on to learn more about the benefits and downsides of these plans.
Benefits of Burial Insurance
Burial insurance often is easy to get, affordable, and helpful. This makes it an attractive option for many families.
Ease Financial Burden
A burial insurance program eases the financial burden your loved ones are bound to face when you pass away unprepared.
Coverage, like the Colonial Penn 995 plan, provides a substantial lump sum. It can be used to pay for:
- Pay for funeral expenses
- Burial costs
- Other final expenses
- Special wishes
This alleviates some financial burdens on your loved ones, allowing them to focus on grieving.
Guaranteed Acceptance
Whether looking at burial insurance for seniors or another type of burial policy, you will always get accepted.
That’s because, unlike traditional life insurance, burial insurance doesn’t require a medical exam. You’ll be approved for coverage, no matter your health status or age.
This offers peace of mind to older adults or those with pre-existing health conditions who are denied access to life insurance.
Affordable Premiums
Even the best burial insurance on the market is affordable for almost anyone—even those on a tight budget or fixed income.
Burial insurance typically has lower premiums than other life insurance policies. The death benefit is smaller, and the policy only covers final expenses.
Just bear in mind that it doesn’t provide long-term financial support for the deceased’s family.
Downsides of Burial Insurance
Of course, burial insurance isn’t suitable for everyone. You need to assess the policies on the market carefully before signing on the dotted line.
Limited Coverage
Burial insurance companies tend to provide smaller death benefits than other life insurance products. This means the lump sum payment your family receives at your death may not cover all end-of-life expenses.
In addition, some burial insurance policies have limits on what they cover. They may dictate where your funeral can be held or what services are available.
Premiums Increase With Age
As with other types of life insurance, older adults will experience premium increases as they age.
This is, of course, due to the higher risk of death for seniors. Check the policy details carefully to see what the increases look like in later life.
Of course, for most burial insurance policies, these premiums are still far lower than even minimal life insurance coverage.
Limited Investment Potential
Many life insurance policies have a cash value component built into the plan. Essentially, life insurance policies accumulate cash value over time.
Burial insurance typically does not have this component.
Anyone looking for a policy that provides financial protection and an investment opportunity will be disappointed with burial insurance.
Additionally, some burial insurance policies limit the changes you can make to the coverage amount or the premiums over time.
Responsible End-of-Life Planning Helps Everyone
Burial insurance can support your end-of-life expenses and ease the burden on your loved ones.
However, weighing the benefits and drawbacks before choosing a policy is essential. Consider your options carefully and review all the products on the market.
For more savvy financial advice, check out the other blogs on our website.