People will often have a specific reason for purchasing life insurance protection. For example, many young families will place a policy on both spouses or partners so that, in the event of the unexpected, the other will be able to go on paying his or her living expenses and / or they will be able to pay off large debt, such as their mortgage balance.
When someone is considered to be a senior – typically age 50 or over – the need for life insurance may change, but it doesn’t go away. In fact, although many people feel that seniors do not need life insurance if they no longer have dependents, this isn’t necessarily the case.
In fact, one of the biggest needs for life insurance that a senior has is that of final expenses. These costs can include the payment for a funeral service, along with other related expenses, such as a headstone and burial plot (or alternatively, cremation and an urn), preparation of the body, transportation to the gravesite or place of final interment, flowers, and the printing of funeral notices.
When all added together, the average cost of funeral related expenses can be in the range of $10,000. So, having a burial insurance policy in place can help to provide a fast and easy way for loved ones to pay off these expenses, without having to go into financial hardship by paying the expenses out of pocket or by putting the expenses on credit.
What Is Burial Insurance?
Burial insurance is a type of life insurance policy that is geared specifically for paying off a person’s funeral and other final costs. Because of this, these policies are also often referred to as funeral insurance or final expense insurance.
These policies are typically offered to those who are seniors in the age range of 50 to 85 – although some insurance carriers will have policies available to those who are in older age ranges.
Because burial insurance is typically purchased for the purpose of paying off final expenses, the amount of the death benefit coverage will usually be in the range of $5,000 to $25,000. Here, too, there are some life insurance companies that will offer higher death benefits – in some cases, up to $500,000.
While there are several types of coverage, in many instances burial insurance is a whole life insurance policy. This means that the insured will be covered by a death benefit and that the policy also contains a cash value component.
Because whole life insurance is considered to be permanent insurance, it is intended to remain in force for the remainder of the insured’s lifetime – provided that the premium continues to be paid.
Whole life insurance will also provide an amount of coverage that is guaranteed, and likewise, the amount of the premium is also guaranteed to not increase – even given the insured’s increasing age, as well as if they are to contract an adverse health condition.
The cash value that is a part of the burial insurance policy is allowed to grow on a tax-deferred basis. This means that there is no tax due over time as the funds grow unless the policyholder withdraws the money. If he or she does withdraw or borrow these funds, they may be used for any purpose.
How Burial Insurance Works
In many ways, a burial insurance policy works just like any other type of life insurance in that the policyholder will pay a premium in return for death benefit protection when they pass away.
In some cases, the beneficiary on the policy may be a funeral home. This way, the payment of the insured’s final expenses can be more quickly distributed, leaving his or her loved ones with one less thing to worry about during their time of grieving.
In other instances, an individual will name a family member or other loved one as the beneficiary on the burial insurance policy. The receipt of death benefit proceeds from a burial insurance policy will be free of income taxes to the beneficiary (or beneficiaries) who receive it.
Because those who are applicants for burial insurance are generally in the older age ranges – and in turn, may have various health conditions at the time that they purchase a policy – the offering insurance company may pay out only a certain percentage of the stated death benefit if the insured passes away within just one or two years of policy purchase. This way, the insurance company can help to protect some of its own financial risk.
With this in mind, it is important to know exactly how the benefits on a burial policy for seniors will be paid out upon the passing of the insured. This is because the policy beneficiary may end up receiving considerably less than the stated death benefit if the insured passes away soon after the policy’s purchase.
Because burial insurance for seniors – and all life insurance policies – may differ in term of premium price, it is important to shop and compare policies from several different insurance companies prior to making your purchase. Doing so through an independent life insurance brokerage or agency can allow you to do this quickly and easily, though, often via your computer and without the need to meet in person with a life insurance agent.
Will You Qualify For Burial Insurance?
Burial insurance for seniors is often offered as either guaranteed issue or as a no medical exam policy. This means that there will be no medical exam that is required in order to be approved for the policy.
While a no medical exam policy will usually have some medical questions for the applicant to answer on the application for coverage, a guarantee issue policy may not. Because of that, it is often much easier for an applicant to qualify for burial insurance coverage – even with certain health conditions. The policy typically also cannot be canceled by the insurance company for any other reason other than the non-payment of premiums.
Where To Find The Best Rates And Compare Burial Insurance Policies
If you are shopping for burial insurance, we can help you in determining the best premium rate, as well as to find a policy that meets your specific needs. We work with many of the top burial insurance companies in the industry today. When you are ready to proceed in finding this important information, just fill out the quote form on this page.
We can also be reached by phone, toll-free, to answer any questions you may have. You can call us at 888-501-0530 in order to get your questions answered quickly and efficiently. So, contact us today – we’re here to help.