Burial insurance

Stress and grief can go hand-in-hand when a loved person dies, especially if the funeral costs are not paid in advance. Burial insurance can be a way to reduce stress and plan ahead. What is burial insurance?

Burial insurance is also known as end-of-life, final expense, or funeral insurance. It is a whole-life insurance policy which is designed to cover the cost of your burial. These expenses may include a memorial ceremony, cremation costs and a headstone to your grave.

What is burial insurance?

Your loved ones will know what happens to you when you pass away if you have all your affairs in order. You might have provided instructions on how your body should be treated. This may include notes about the organization of your memorial service and what you would like written on a gravestone.

All of these costs can add up, and sometimes cost thousands of dollars. A burial policy is a good option if you don’t want your loved ones to have to pay those costs. A small, permanent insurance policy that provides a death benefit (usually between $5,000 and $25,000) to help cover these costs.

The premium for burial insurance can be very affordable because the payout is smaller than regular life insurance policies. Even for people in poor health, the policies are simple to obtain and don’t require a medical exam. There may be a waiting period or only limited benefits for the first two years.

What are the benefits of burial insurance?

Burial insurance policies pay all costs associated with a death. You may not be familiar with the costs of managing the estate of a loved-one. The Federal Trade Commission states that costs can include:

  • Preservation or Embalming the Body
  • A casket
  • Flowers
  • Cremation costs
  • A burial plot
  • Transport costs for the body/cremain
  • A custom-made headstone with carved details
  • Priest or minister payment
  • Costs of renting the location where the memorial service will be held
  • Cost to open and close a grave
  • Grave vaults and/or graveliners

What is burial insurance?

Burial insurance is available from all regular insurers and, in certain states, through licensed funeral homes. You will need to fill out a simple form asking for health information. However, you won’t be required to have a comprehensive medical exam as with traditional life insurance policies. A guaranteed issue policy is a type of burial policy that does not require any health or medical questions. It is for people who are severely ill and cannot obtain a policy in any other way.

Although it may be possible to buy a policy online at times, it will usually require you to call an agent or broker. A broker can help you find the right policy for you by showing you products from different insurance companies.

After you purchase a policy, ensure that the person designated to deal with your end-of life matters is informed of it. They should also know the policy number as well as the name of the agent who sold you it.

The process of filing a claim for burial insurance should go smoothly if all necessary arrangements have been made. Imagine John suddenly dying. Ted is John’s executor and beneficiary. He has all paperwork necessary to insure John’s burial. Ted informs the company. They process a check for the specified amount and then give it to Ted within days. Ted can then make a downpayment on a casket, and start making arrangements for a funeral and service. He now has the funds to hire workers to handle John’s burial and service.

Which is the best type of burial insurance?

Lincoln Heritage is one example of a company that sells burial insurance. However, there are many other regular life insurance providers who offer it. These are just a few of the options you should consider.

CarrierBest forMaximum Coverage
AARPIt’s easy to applyFrom $2,500 to $25,000
Colonial PennFlexibilityVariable
Mutual of OmahaAffordabilityFrom $2,000 to $25,000
State FarmCash value$10,000


American Association of Retired Persons is well-versed in serving the needs of seniors. They offer life insurance and burial policies specifically for seniors in collaboration with New York Life.

There is no requirement to complete a health questionnaire. The only requirements are that you be a member and at least 50 years old. Only one health question is required to be accepted, except if the applicant is seriously ill.

Colonial Penn

Colonial Penn only sells life insurance. This includes a guaranteed acceptance policy that can be used to pay for burial costs. To purchase a final expense policy, there is no need to undergo a medical exam.

You can borrow against the policy’s cash value and there are many flexible payment options. The rates are guaranteed and the prices are competitive.

Mutual of Omaha

Mutual of Omaha has guaranteed acceptance policies available for people aged 45-85. There are no health questions.

Coverage amounts starting at $2,000 can be increased to $25,000 if you’re looking for a more affordable policy. The death benefit amount will be replaced by 110% of the premiums paid if the insured dies within two years.

State Farm

State Farm policies can allow you to earn dividends. These can be paid in cash or used for premiums. The policy also includes cash value, which can be borrowed against the death benefit to grow tax-deferred.

Although there are many benefits to this policy, the coverage limit is $10,000. Seniors 50-80 and older people in New York are eligible for policies.

What is the cost of burial insurance?

Your gender, age, and policy size will determine your burial insurance premiums. This means that the amount you pay for your policy will be unique to your situation. According to the National Funeral Directors Association, the average funeral cost with a vault is $9,135, while a cremation is $5,000.

Here are the standard rates for a $5,000 policy with burial insurance company Lincoln Heritage.

Man is 50 years old$16 or $20 without health questions
Age 75 for man$51, or $63 without health questions
Female age 50$14 or $15 with no questions about your health
Age 75 for a woman$38, $46 without health questions

Is burial insurance worth the cost?

While a burial policy can be a part of your financial strategy it is worth considering your other options. As with all life insurance policies rates increase with age. Therefore, the more you get older, the less likely it is that you will want to invest significant resources in a policy. Although burial insurance is very popular for seniors, another option is to build a nest egg of around $10,000 and hold it in a liquid investment that can be accessed quickly by your heirs after your death.

Prepaying funeral expenses is another option. Funeral homes often allow you to select a casket, and assist you with choosing and paying for other funeral expenses. This gives you control over your funeral. You can decide how you want it handled. You may save money by locking in rates earlier.

Questions frequently asked

Are I required to have burial insurance if my age is younger?

If your health is in serious decline and you are concerned about your heirs paying your funeral expenses, then probably not.

What is the difference between burial insurance and regular whole-life insurance?

Burial insurance can be a type or whole life policy. However, it generally has a lower death benefit and doesn’t include the extensive health questioning that is required with whole life policies.

What is the difference between burial and funeral insurance?

Burial insurance is another term for funeral insurance. These policies are whole-life policies that provide death benefits to help cover funeral and burial expenses.