Nearly everybody is aware of life insurance and its benefits. However, there is one type of life insurance that is not as well known to the average consumer. It is known as funeral insurance, final expense insurance, or most commonly, burial insurance.
In my professional life, there are generally two circumstances where the topic of burial insurance comes up. The first is when a client or prospect comes to me and their friend just purchased or heard about a final expense policy, and now they want to know if they should get one too. The second situation is when I’m meeting with a client and realizing that they probably lack the funds and/or insurance coverage to pay for their own funeral in the event of their demise.
Many people do not realize how much final expenses can tally up to. The average funeral service in the United States is over $10,000. Between a casket, burial plot, flowers, funeral home, transportation, etc., it is easy to see how costs can add up quickly.
This is where burial insurance comes in. Some people financially just cannot afford a larger term life insurance plan. What they often do not realize is they could qualify for a very inexpensive burial policy that will remove the financial burden of their funeral costs from their loved ones. Even some of the most financially strapped individuals I have met with, were able to pay for a policy and rest easy knowing their family was not going to have to scrape together the money to fund their final expenses.
In addition to removing the financial burden from loved ones, a burial policy can also allow an individual to plan out their final wishes. Once you know how much coverage you qualify for, you can meet with a funeral director to plan your funeral and burial based on the coverage you are allotted. Planning your funeral ahead of time lifts a huge burden from your loved ones in their time of mourning.
Although burial insurance is surely not for everyone, it definitely has a place for some people in their financial planning.