Tag Archives: life insurance

Funeral Insurance

Funeral Insurance Plans

Funeral insurance is not the same as a prepaid funeral plan. With normal life insurance, you might have to undergo a medical exam, while “funeral life insurance” companies will not subject you to that.  Some insurers load (increase) the premiums OR don’t pay out until you have survived – typically – 2 years. That makes funeral insurance a gamble, in our book.  But sometimes it is still the right thing to do.  We review every case on its’ facts.  But worse is to follow with many…

Funeral Insurance pay, pay and pay some more…

Funeral Plan Quotes

Funeral Plan Quotes

Additionally, you will often have to continue to pay for insurance for your entire life, and you may well end up paying more than your funeral actually costs. With many funeral plans, there are no age restrictions, unlike many insurance companies. If you miss a couple of payments, most companies will make no refund, and no payment whatsover when you then die.

What is better than funeral insurance?

Funeral plans are a very easy idea to understand, and you can either pay for the funeral in full at the start. Alternatively, you can pay whatever you can afford as a deposit with monthly payments over a year or up to 10 years.  One year schemes are usually interest free.

When your funeral arrives, you have a paid for the funeral services, and your family will incur little to no expense as a result.  They might need to pay a little bit in some cases, that that is much better than having to find several thousand pounds unexpectedly. Generally speaking, flowers and catering are not included (but you can add funds to make an allowance for them if you wish.)  But one of the reasons the Prepaid Funeral Review team are so important to making a wise choice is that some plans leave out vital things – such as the actual funeral.  So our independent professional advice is really comforting to folk determined to make life as easy as possible for those left behind.

Funeral Plans Gives You Peace of Mind, in addition to removing the future cost burden on your family members.

If, like me, you have seen families argue and fall apart over funeral arrangements, you can also use funeral plans to reduce their stress during an emotional time. When we organise your funeral plan, you often have several different options. Many companies will have a basic plan, which might include a simple coffin and no service. They might have a standard plan including a posher coffin, transportation and a service. The premium plan may include even more things such as a second car. Most funeral plan providers also allow you to pick and choose what you want at your funeral. What this means for you is that get to choose what you want included at your funeral. Perhaps a special kind of flowers?  A favourite song? Any detail that you wish can be added into your funeral plan. This way, your family members will not be able to fall out over what you would have wanted, and the already ultra stressful situation will not be even harder.

Funeral Plans save you and your family money and extra grief.

Many funeral life insurance companies will offer funeral plans based on the cost of a funeral when you invest in your plan. Funerals are expensive, and the prices continue to rise at above the rate of inflation each year. This means that your death can leave your family with a large financial burden. By purchasing a pre paid funeral plan, rather than a conventional insurance policy, you are saving them from the high costs of a funeral. Even if the prices have risen massively, your family will not have to pay the difference on the main items. By purchasing a funeral plan instead of funeral insurance, you are also saving yourself from paying ongoing premiums. If you are interested in finding a company that sells funeral plans, but the right ones for you, you have come to the right place – we can help find the most suitable plan for you

Funeral insurance if you still want to know more, click the link!

More on funeral insurance.

There are three types of life insurance which the public think of as funeral insurance, though it is rarely advertised as such as it isn’t.

  • Term insurance – this type of policy last for a specific number of years and then finishes with no cash value.   If you miss payments, then most policies will be cancelled and you will get nothing back.  If you die after the policy finishes, you get nothing.  In most case the funeral will cost far more than the death benefit which was fixed when you took the plan out  For the sake of argument, if your initial cover is for the full cost of the funeral, ten years later it will probably cover half of it with a bigger shortfall every year as inflation bites harder. Even worse are policies with a reducing death benefit.
  • Non profit whole life.  There are at least better than term insurance in that at least they will pay out when you die, if you don’t miss any premiums.  There is no investment element, so the only way to get cash back is by dying.
  • Flexible whole life: these are only sold by regulated financial advisers, so rarely appear as a funeral plan recommendations. They could be used but they are pretty complex and the premiums would have to be pretty high: but there would still be no guarantee.  We are not financial advisers, just funeral plan experts.

Life Insurance Funeral Plans (Over 50 Plans)

Life Insurance Funeral Plans (or Over 50 Plans)

Funeral Life Insurance plans (or over 50 plans)  are widely advertised on TV, in magazines and direct mail.  They look good for older people as a medical or medical evidence is not required before taking one out so your health and age don’t matter.

But if you watch or read carefully you will find that

Over 50s Life Insurance is NOT Suited for Funeral Planning.

Funeral Plan Quotes

Funeral Plan Quotes

Life insurance funeral plan policies accept all comers, which can be a plus or a minus.   Clearly, premiums will be higher than for a properly underwritten life insurance policy, and you wouldn’t have the problem that you have to live for two years (generally) after the plan has started before it will pay out.

Since you pay premiums until you reach a certain age (typically 85 or 90 – sometimes until you die), those in good health are effectively subsidising those who are not so fit

If you live too long, life insurance funeral plans can be poor value as it may not pay out as much as you’ve paid in!  On the other hand, if you die too soon it may not pay out at all.

There are two other aspects to review with life insurance funeral plans.

  1. Admin charges can take out a large proportion of small monthly premiums, making them worse value.
  2. Most life insurance plans pay out a set amount, which may be fine NOW, but could be woefully inadequate in 10 or 20 years time.  At current levels of funeral cost inflation, costs will double in around 10 years, and be FOUR times as much in twenty years.  If you pay for thirty years, funeral costs could have risen to EIGHT times the current cost.  So we strongly recommend considering a proper prepaid funeral plan if you possibly can.
  3. You will lose everything you have paid in if you no longer pay premiums – perhaps through a bank error, or because you are ill or just can no longer afford the premiums.  That could be thirty years worth of savings – gone.  Is that fair? Is it a risk you want to take?  That doesn’t happen with prepaid funeral plans.

But I already have a Life Insurance Funeral Plan!

We don’t suggest that you should cash it in, as if it is the type of plan we are describing here, you’ll get nothing back,   But what you could do is use it to provide the extras that a basic (relatively inexpensive) prepaid funeral plan doesn’t.  So contact us to add a proper funeral plan to the life insurance one.

We believe the best safeguard is to choose a pre-paid funeral plan from a company, ideally approved by the Funeral Planning Authority. This has a code of practice that members agree to and ensures that your money is held separately in a trust fund which is absolutely crucial.   You can usually add in a choice of extras to cover parties, coach and horses or whatever you wish too as well!

The crucial part of using an approved firm is that your money is kept in a TRUST, which protects it should the undertaker or pre-paid funeral plan firm go out of business, so your hard won savings won’t be lost.

Naturally, if you have a decent amount of savings, you can state in your will that they must be used to pay for your funeral which is one way try to ensure that your money is used as you would wish.  But be aware that directions to your executors in your Last Will are only regarded as being WISHES, and the executors can choose to ignore them.   A pre-paid funeral plan is a far better bet.  The life insurance funeral plans generally give you no real control at all over how your funeral is conducted.

So  we would generally recommend a pre-paid funeral plan

Life Insurance Funeral Plans (Over 50 Plans) – Prepaid Funeral Review