When a loved one passes away, it can be a difficult time for the surviving family as they grieve and prepare for a funeral. In many cultures, funerals are considered important events and families may travel from long distances to attend. However, funerals can also be expensive and if the deceased was the primary financial provider, paying for the funeral can be a challenge. When a person dies, their bank account is typically frozen, making it difficult to access funds to pay for the funeral.
Funeral insurance is a way for individuals and families to ensure they will have the means to pay for a decent funeral when the time comes. The cost of funeral insurance is relatively low and can be purchased as a stand-alone policy. The main purpose of funeral insurance is to provide a lump sum that can be used to pay for funeral expenses.
Different funeral insurance policies may vary in terms of benefits and coverage. It is important to read the terms and conditions of a specific policy or consult an expert financial advisor in detail to understand when and how the policy will pay out.
Funeral policies may cover different individuals, such as immediate family members. Some policies may provide a cash lump sum, while others may cover specific funeral expenses such as a coffin or gravestone. Some policies may also include a funeral advisory service, which can assist the family with funeral arrangements, selecting a coffin, and providing counseling.
The policy covers the life of the policyholder, their immediate family, and any extended family members that are specified in the policy. The main policyholder is referred to as the “sponsor.” If the sponsor fails to pay premiums, the entire policy will be cancelled.
Funeral policies have age limits and restrictions on who can be insured. The term of the policy can vary, with some ceasing coverage when the insured reaches a certain age, such as 65. The maximum age of entry for a principle member is typically between 65-80 years. Some providers also offer coverage for stillborn births and children who are full-time students. There may also be limits on the number of extended family members that can be covered under the policy.
Funeral insurance policies typically cover expenses related to funerals. Some insurers, however, may offer additional features and benefits to make the policy more appealing to customers. These can include:
- Waiver of premium: If the policyholder dies, the premium on the policy may be waived for a certain period of time.
Accidental death benefit: An additional payment, sometimes up to double the insured amount, may be made if the policyholder dies in an accident. - Disability benefits: This benefit may be limited to the policyholder and may provide a limited amount of coverage for disability.
- Terminal illness benefit: A portion of the life insured’s benefit may be paid out when the policyholder is diagnosed with a terminal illness and is expected to die within 12 months. The remaining balance is paid out upon death.
- Cashback benefits: Some of the premiums paid over a period of time may be returned to the client, for example five premiums returned after 60 have been paid.
- Premium holidays: Some policies may offer a break in premium payments for a certain period.
When it comes to choosing the right health insurance plan, it’s important to keep in mind that the benefits offered can vary greatly between providers. That’s why it’s essential to consult with an expert to create a plan that meets your specific needs.
At G&S, our team of seasoned advisers is here to guide you through the process of selecting the best plan for you. We’ll help you understand the different options available and choose the benefits that are most important to you. Plus, we’ll work with you to find the lowest premium possible for your selection.
Don’t leave your funeral cover to chance. Book a Meeting with one of our advisers today to learn more about how we can help you find the perfect plan for you. Alternatively Contact Us for more info.