Deciding how much burial insurance you need depends on a number of factors tied specifically to you. Most burial insurance companies offer policies that provide coverage between $1,000 and $25,000. Consumers can purchase a policy in that range in increments of $1,000. The most reliable way to determine how large of a policy you need is to speak to a licensed insurance agent that can assist you in customizing a policy to fit your specific needs. However, if you are looking to just get a basic idea of how much burial insurance coverage you might need, there are a few steps you can do on your own to make a rough estimate.
- Research the probable cost of your funeral and final expenses and calculate your potential need.
- List any personal or legal costs that will need to be paid as well as any possible inheritance you wish to leave behind.
- Total up these potential costs and compare policies from different companies to see what your premium might cost to cover your estimated expenses.
Research Funeral Service Costs
Many people are amazed at just how expensive funerals can be. Just the basic needs for a funeral (casket, burial, headstone, etc.) will add up quickly, but many of the administrative costs and fees associated with the services provided by funeral homes are often overlooked or underestimated when someone is planning a budget for their final expenses.
In 1994, a law was passed called the Funeral Rule. It states that any providers of funeral services or related products must provide an itemized list of all products and services that they provide with prices before they make any effort to sell them to you. This itemized list is often referred to as a General Price List, or GPL. If you are going to pre-plan your final arrangements and shop around at a few different funeral homes, be sure to ask them each for their GPL, so that you can more easily compare the prices and services offered from each establishment.
In 2012, the National Funeral Directors Association reported an average funeral cost of $7,323. Everyone’s wants and needs are going to be different, and it is easy to plan a service and final arrangements that will cost far in excess of the national average. It’s best to visit our page discussing funeral costs to learn more about the specific costs involved with a funeral. You will also want to check with any state requirements you might need to meet.
Things like the cost of a burial plot can vary greatly from town to town, state to state. You also might have a good relationship with a local church whose minister might be willing to officiate your service with little or no cost.
Organize Personal and Legal Costs
Once a person plans for the costs of their funeral and burial, many people elect to buy a policy that will also cover any unexpected personal or legal financial expenses that may arise after they pass away. Upon the death of a policyholder, 100% of the benefit value is paid out to the beneficiary. It can be used to pay for other costs in addition to the funeral.
Besides the emotional toll the loss of a loved one takes on their family, often the hardest thing to deal with is the loss of income that individual was bringing in to the family. Any additional funds from a burial insurance policy can be allocated to pay for things like utilities or a housing payment.
In many cases there are legal fees to be paid for the handling of the dividing and handing down of assets that belonged to the deceased. Proceeds from a burial insurance policy can be put towards these estate settlement costs.
Some people would like to leave a little money behind for their children, grandchildren, or other loved ones. Money from a final expense policy can also be used as an inheritance.
Everyone’s needs will certainly be different, but for many people it is a good idea to purchase a policy that exceeds your estimated needs for your final expenses if you can afford to do so. You do not want to leave your loved ones with an unexpected bill.
Now that you know how much burial insurance coverage you need to cover your expenses, you can shop around and compare policies from different companies. You will find that available policy amounts and qualification requirements, as well as monthly premiums, will vary from provider to provider.
We have tried to provide quick and easy quotes options for you to make this process fast and easy.
How Much Will Burial Insurance Cost?
Like any other life insurance policy, a funeral insurance policy’s cost is going to largely be dependent on your age and the desired coverage amount. For most people, you can expect it to cost between $20 and $55 a month, but that number can vary based on tobacco use, health complications, and where you live. Some policies will have a small annual fee attached to them as well. Burial insurance is normally a more affordable option than traditional life insurance, and is easier to qualify for.