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What Does Burial Insurance Cover? Understanding Your Policy

What Does Burial Insurance Cover? Understanding Your Policy
Jason Neufeld
July 1, 2022

Whether you're planning a funeral for a loved one or you're establishing burial insurance for yourself, you may be thinking about the benefits of obtaining burial insurance coverage. Having a burial insurance policy is a great way to be proactive because it helps reduce financial stress after you or a loved one has passed away. But what does burial insurance cover exactly? 

Types of Burial Insurance

There are three main types of burial insurance to consider. This includes:

  • Simplified Issue: With this insurance, a medical exam is not required but the insurer will evaluate your health based on a medical questionnaire. It's important to note that some pre-existing health conditions can disqualify you from getting this policy. 
  • Guaranteed Issue: This policy does not require a medical exam or questionnaire. However, the cost for this insurance will be higher because it is riskier for the insurer. 
  • Pre-need Insurance: This policy involves a contract with the funeral service provider. Ultimately, specific products and services are selected through the insurance provider and the money will go directly to them.

What Does Burial Insurance Cover?

Here is a more in-depth look at what you can expect the standard burial insurance to cover. 

Funeral Expenses

The cost of a funeral can range greatly, depending on the type of burial that's held. In fact, the median national funeral cost with a viewing and burial is $7,640. These fees can quickly become a financial burden for those who are not prepared ahead of time. Here are some standard expenses associated with a funeral: 

  • Basic Service Fee: The basic service fee is one of the main fees associated with funerals. Ultimately, this fee covers the cost of planning, such as a permit and administrative fees. 
  • Service and Merchandising Fee: Another type of standard fee associated with funeral costs is a servicing and merchandising fee. These fees cover things like preparing and embalming the body, as well as transporting it. Service and merchandising fees also include fees associated with the funeral home itself, such as the viewing of the body, memorial, and other services like graveside service. Other fees to consider include paying for the casket or burial container. 
  • Cash Advances: There are other funeral services that a funeral home will conduct on your behalf. These services are paid in the form of a cash advance and these extra fees will be disclosed to you in writing. Some cash advance fees you may pay include funeral flowers, an organist, and a clergy. 

These are the most basic fees associated with a funeral. However, it's possible to incur more fees, depending on your desired services. 

Cremation Expenses

The average cost of cremation services in the U.S is around $3,000-$4,000. While cremation services are cheaper than funeral services, many people still rely on burial insurance to cover the cost of cremation expenses. 

Direct Cremation: The least expensive option when it comes to cremation services is direct cremation. This service involves the body being cremated soon after death. With direct cremation, there is no viewing, which means there are no embalming or casket fees. You also don't need to pay for a headstone or burial plot. However, you will need to pay for the direct cremation service itself.

Cremation With Funeral Service: Some people prefer cremation while still having a traditional funeral service. A funeral service can be arranged before or after someone has been cremated. With that said, you can expect to incur expenses associated with cremation as well as some funeral expenses, such as a basic service fee and some cash advances. 

Other Expenses

There are other expenses that can incur after someone has passed that burial insurance can cover. In fact, many loved ones are left with certain debts after they pass away that will need to be settled. This includes:

  • Medical Bills 
  • Mortgage Loans
  • Credit card bills

Many of these debts can be settled through the estate. But, if there aren't many assets included in the estate, any leftover funds from the burial insurance policy can be used to pay off these debts. 

Who Can Get and Use Burial Insurance?

Burial insurance is generally marketed to those between the ages of 50 and 85. However, some insurance companies market to individuals as young as 30. If you have a burial insurance policy, only your beneficiary can use it for any end-of-life expenses, such as burial costs, medical bills, credit card bills, mortgage loans, and any other outstanding debts. 

Get Started With Your Burial Insurance Plan Today 

Although conversations regarding burial insurance may not be the most enjoyable, they can significantly help your family down the road and provide you the reassurance that your death will not crush your family financially. 

However, choosing the right plan for you can be an incredibly personal decision. That is why you need to work with a knowledgeable provider who can get you the information required to make a sound decision about this critical investment. For these reasons, if you want to find out more about burial insurance policies and what they can do for you, reach out to us today and let us introduce you to a trusted prepaid funeral professional to help bring peace of mind to both you and your loved ones.

Jason Neufeld

Jason Neufeld is the Founder and Managing Partner of Elder Needs Law, a Florida estate planning and elder law firm he created in 2017. With more than 15 years of experience practicing law, he represents clients in a wide range of legal matters, including Medicaid planning, estate planning, elder law, probate, Medicare, and life insurance.

Jason received his Juris Doctor from the University of Miami — School of Law and is a member of the Florida Bar and the Broward County Bar Association. He has received numerous accolades for his work, including being named a Rising Star and Super Lawyer by Super Lawyers and among the Florida Legal Elite by Florida Trend in 2024.

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