Funeral Guide Ltd
75-77 Buccleuch St
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“My husband and I are pensioners, and we were concerned about how our children would pay for our funeral when we die. We hope to be able to leave them some money, but it might not be much” – This piece was contributed by a 50-something who wanted to share their experience
We don’t have a lot of money, but we would not qualify for a Funeral Payment from the Social Fund, so we knew we would need to make some arrangements to pay for our funerals when the time comes.
I went to Go Compare to compare funeral plans oddly enough, and I found out that there are several ways to make sure that your funeral is paid.
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A funeral plan, or funeral insurance, will pay for most of the cost of your funeral. When you buy a funeral plan, you can specify exactly what you want at your funeral.
You can specify cremation or burial, whether you want a wake, which casket and headstone (not covered) you prefer, and so on. The benefit of a funeral plan is that you will pay the cost of a funeral today, and your future costs will be covered. This was important to me because I don’t want my children to have to pay for all of this.
Go Compare told me that we could use life insurance to pay for the cost of our funerals. We have a small whole of life insurance policy, so it will pay out no matter how long we live, as long as we continue to pay the premium.
If you have term life insurance, you will only have cover for the term of the policy. If you live longer than the policy lasts, you will not have the death benefit to pay for your funeral costs. Some term policies are convertible so that you can convert them into whole of life policies without having to pass a medical exam again. You will pay higher premiums, but you will have the cover you need to pay for your funeral.
If you don’t already have life insurance, you may be able to get it. Depending on your age, it could be expensive. There are special Over 50s life insurance plans that don’t require a medical check but beware.
They can be very pricey because they insure everyone, regardless of their health. Usually, if you die within the first two years of buying the policy, you will only get back the premiums you’ve paid, not the whole death benefit. You have to own the policy for longer than two years for your beneficiary to receive the full death benefit of an Over 50s policy.
If your health is good, you may be better off getting a traditional life insurance policy instead of an Over 50s plan. Your premium will increase the older you are, but you may not need a lot of coverage if the intent is to cover your funeral expenses.
A policy with a death benefit of £2,500 would cover the basics of a funeral or cremation, or £5,000 if you want to include catering and so on.
Go Compare provided a lot of information I needed to make a decision on how best to pay for our funerals. I also learned what to look out for and what questions to ask when shopping for a funeral plan or a life insurance policy to cover funeral costs.
You may make a one-off payment for your funeral plan, or you may pay for it over time.
If you choose a payment plan, be sure to find out what happens if you die before all of the payments are made. Also, ask what happens if the funeral home goes out of business.
A funeral plan is usually a life insurance policy that is payable to the funeral home when you die. You pay for the policy, and the funeral home gets the death benefit, which they use to cover your funeral costs.
I was concerned about what might happen if the funeral home I bought the policy through went out of business, but the insurance carrier is who you should be worried about. Make sure the carrier who underwrites your plan is reputable.