Affordable Burial Insurance
Article Quick Guide
What IS Burial Insurance?
Well, burial insurance is a final expense life insurance policy structured as whole life. It pays for your end of life expenses, so that you do not leave that financial burden to your loved ones. Most commonly, final expense policies like these, pay for burial/cremation and funeral expenses. You can also “beef up” your policy to pay for other bills and to add a financial gift.
This type of coverage should never be a “term” structured policy. You should never have to worry about it expiring, and getting re-insured or having your price increase at the end of the term. It’s the last life insurance policy you’ll ever need, unless the demands of your beneficiaries change over time. A whole life final expense, life insurance policy is typically going to have a death benefit between $5,000 – 40,000. The policy is never going to change. Meaning, the price will never go up. The coverage will never decrease.
Burial insurance policies also have the added benefit of building up cash value over time. Cash value is essentially an emergency fund, for you. It needs to be clear that cash value is NOT extra money above and beyond the death benefit for your beneficiaries. You can tap into your policy and you can pull out your cash value. However, there are a couple of consequences. The biggest one being that your beneficiary is going to receive the death benefit minus whatever you pulled out of the policy.
So if it was a $40,000 policy and you pulled out 15 grand, your beneficiary is going to receive $25,000 instead of the $40,000. Finally, cash value is pulled out in the form of a loan, with a low interest rate. The low interest rate is also important to be aware of. Because, if you use the cash value to pay your premiums, it will negatively impact your loved ones, moreso, over time. It’s a good feature to understand. And now you know why we refer to it with our clients as an emergency fund. If you need it, it’s there.
Jumbo Whole Life Burial Insurance
There are jumbo burial policies that offer larger death benefits. To get the larger dollar policies ($50,000 – $5,000,000) you have to be exceptionally healthy in order to qualify.
The following are some of the requirements for larger burial insurance policies:
- 0-1 active prescription medicines
- Ideal build (Height/Weight)
- Clean medical history
- No blood thinners, insulin
- No medical complications due to common issues
- 0-minimal minor medical issues
Very few seniors qualify for a jumbo burial insurance policy. Qualifying aside, very few seniors actually need more than $10,000 – $30,000 in coverage for their loved ones. Traditional burial insurance tends to be the best fit for seniors’ needs.
Secure Your Most Affordable Option
Getting affordable burial insurance starts with selecting a life insurance agency and agent that has terrific access to a lot of different programs. An independent broker can shop these companies, and all of their options for you. It’s that simple. You don’t need to meet with 20 agents. Just meet with an independent agent (not a captive agent)- someone that can pull from many companies, in order to get you the best possible price.
Of course, sharing your budget and goals with your agent, will go a long ways toward the agent being able to pinpoint your best possible and affordable burial insurance option.