Is Funeral Insurance Necessary if I Have Life Insurance?
June 9, 2016
Funeral insurance necessary in South Africa? Of course, it is.
Funeral cover means your family can plan your funeral without any ‘whose going to pay’ issues flying around.
The average cost of a funeral in South Africa is about R10 000. But not many people have this kind of money readily available.
Of course, the amount of funeral cover you buy depends on how much you want your final expense to cost.
There is no standard type of funeral insurance – it is any policy purchased with the intent of providing for your funeral. There are quite a few people who have life insurance, and they make sure they buy enough to include the costs involved with a funeral.
The answer to the question ‘is burial insurance necessary if I have life insurance?’ is yes and no. Why so many people in South Africa prefer to take out funeral insurance and not life insurance is its affordability. And there is no life insurance policy where you can pay as little as R25 a month.
Funeral Insurance Necessary – So Much Red-Tape with Life Insurance
Yes, many people pay the costs of a funeral with life insurance proceeds. Usually the policy states who the beneficiary will be.
The trouble with relying on life insurance for a funeral is the irritating red-tape with life insurance payouts, which is a legitimate concern with people who only have life insurance – the timing. Significantly, the slowness can be a burden to those left behind.
Not only that. Where death requires some further investigation, then the payouts can be held back for as long as two years. By then a family may have had to contend with not one but several funerals, which can be a nightmare for people who don’t have anywhere to turn for help in covering the funeral bill.
Some people don’t know the difference between life and funeral insurance.
- Life insurance, on the death of a person, provides money to the beneficiaries.
- Funeral insurance pays for the actual cost of burial itself. It is, for this reason, that funeral policies pay out quickly once they receive the claim.
Funeral Insurance Necessary – Much Simpler
The payouts with life insurance can be huge and can provide a quality lifestyle once you have passed away. Companies calculate the monthly premiums for a life insurance policy according to the risk profile. So they look at age, health and salary.
With funeral insurance, there are some policies which don’t even require you to have a bank account. They don’t even ask for a medical examination for you to join – they accept you unreservedly.
Funeral Insurance Necessary – No Cash Value
Sometimes life insurance policies have a funeral component. It’s always a good idea to check with your provider. If you’re looking for a cash value that you can cash in at any time, funeral insurance won’t provide this. Life insurance has a money value to meet an immediate need.
Whatever your motives for getting funeral or life insurance, one way or another you’ll be sparing your family from having to sort out your funeral expenses.
The death of a loved one will always leave an un-fillable hole in your social life. Without insurance, it will also leave a huge hole in your wallet.
With insurance to cover you, life resumes normalcy far quicker. Do research and understand the differences between life- and funeral insurance so that you don’t have any disappointments and false expectations.
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All info was correct at time of publishing