What Is Funeral Insurance – Is It Like Life Insurance?
Many people want to find out: “What is funeral insurance”?
So what is funeral insurance they ask – is it the same as life insurance? Funeral insurance is a kind of life insurance.
The Long Term Insurance Act of 1998 designates funeral insurance as Family Assistance Business.
Funeral homes and insurance agents sell funeral insurance.
What is funeral insurance?
Funeral insurance, like life cover and other insurances, will have its particular characteristics. Funeral cover is for those who are concerned about their passing and helping the surviving family to cope.
Also, who will cover the funeral expenses? Without a funeral plan in place, funeral expenses can break you financially and also cause bitterness.
Who needs funeral insurance?
Many people who are not well will think about funeral insurance as well. Many life insurance policies request applicants to undergo medical check-ups to see what kind of risk they are. Applicants for funeral insurance do not need to be in excellent health.
Funeral insurance is the assurance that when you or a family member dies, the other members will receive a payout.
That will cover the cost of the funeral plus other benefits. Usually, the premiums for burial insurance are lower than comparable life insurance. Death benefits are also generally smaller than what you would get for other life insurance types.
What is funeral insurance
If you are wondering whether taking out a funeral policy is a good idea for you, then you need to consider a few things such as:
- Maybe because of ill health or other health conditions, you are unable to buy the typical life insurance
- On the other hand, your budget may well be able to cope with the funeral insurance premiums and what they offer
Premiums on your funeral insurance will usually be paid either in monthly or quarterly or even yearly instalments. The amount you pay every month will fit your budget and your needs best.
If you suddenly decide to you want to cancel your funeral insurance at some time, according to the Policy Holder Protection Rules, you can do so. You do this in writing within the first 30 days of membership.
If you haven’t put in a claim, but you have paid your premium, you will get that amount reimbursed to you. However, if you decide to cancel your policy after 30 days, then the policy lapses and you lose all your paid premiums.
You can also increase your cover within your age limit if you like. The new increase will go through the new waiting period while it keeps your present cover intact.
Keep your Premiums up to Date
You need to keep up with your premiums otherwise your policy will lapse – this will depend on the rules of your scheme. Sometimes if you have never defaulted, there might be a sympathetic ear in times of need, but not likely.
It is better to keep up with your payments. When a funeral needs to take place in your family, you will be so glad you kept up with your affordable payments.
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