Losing a loved one is heartbreaking, no matter what the circumstances are. The weeks following someone’s death can be extremely difficult for those left behind as they plan a funeral and burial. The fact that burials can be costly adds to the issue. According to the National Funeral Directors Association, these expenditures average around $7,000, depending on the services chosen, which can quickly add up. The last thing a bereaved person should be concerned about is how they will pay for these services. You may want to consider obtaining burial insurance, often known as end-of-life insurance, to assist reduce some of the hardship on your family. Here’s what you should know about a burial insurance policy and how it can benefit seniors. We’ll also look at a review of the best burial insurance companies for 2023.
What is Burial Insurance?
Your loved ones will know what will happen after you die if you have your affairs in order. You may have left instructions on how you want your body to be treated, as well as notes on how you want your memorial ceremony to be organized or what you want to be engraved on a tombstone.
But all of these things are expensive, often in the thousands of dollars. If you do not want your heirs to bear those fees, you should think about purchasing burial coverage. This is a small permanent life insurance policy that pays a death benefit — typically between $5,000 and $25,000 — to meet these expenses.
Because the payout for burial insurance is tiny in comparison to many standard life insurance plans, the premiums can also be fairly low. The insurance is simple to obtain and does not need a medical checkup, even for individuals in poor health. However, a waiting period may apply, or the policy may only provide restricted benefits for the first two years.
What Does Burial Insurance Cover?
Burial insurance policies cover all of the regular costs associated with a person’s death. Unless you have managed a loved one’s estate, you may be unaware of the number of fees involved with death or how rapidly they can add up. Costs may include, according to the Federal Trade Commission:
- Embalming or body preservation
- A coffin
- Flowers
- Cremation fees
- A burial plot
- The cost of conveying the deceased’s body and/or cremains
- A headstone with personalized carving
- Minister or priest remuneration
- Rental fees for the location of the memorial service
- The cost of opening and closing the grave
- Vaults and/or grave liners
How Burial Insurance Works
Burial and funeral insurance policies do not typically need a medical exam, and the application may just include a few health questions—or none at all. Rates are mostly determined by age and gender. Burial insurance is usually one of the following types of whole life insurance:
Simplified issue life insurance: There will be no medical exam and only a few health questions, but answering “yes” to any of them may disqualify you. For example, simplified issue applications frequently ask if you live in a nursing home or if you have HIV.
There are no health questions or medical exams required to apply for guaranteed issue life insurance. You cannot be refused.
The disadvantage of these simple applications is that the policy usually has a tiered death benefit. If you die within the first two or three years of purchasing the policy, your beneficiaries will only receive a return of the premiums you paid, plus some interest, or a tiny percentage of the policy’s coverage amount. Accidental deaths, such as those in an aircraft crash, are normally fully covered from the commencement of the policy.
Seniors Burial Insurance
If you are 65 or older, you may be considering end-of-life planning and getting burial insurance. However, the more the premium for the policy, the older you are. Burial insurance becomes more reasonable as you get older. Furthermore, many policies include a vesting period between the time of purchase and when the insurance is paid out. Your loved ones would not receive the death benefit if you died within the vesting period. For these reasons, it’s critical to carefully review the policy’s terms to verify it’s the right policy for you.
Is It Possible To Be Denied Burial Insurance?
Burial insurance is typically a guaranteed issue policy, which indicates that anyone who applies will be approved. There is no medical checkup, and you may not be required to answer any health-related questions.
How Much Does Burial Insurance Cost?
Because burial insurance policy applications demand little to no medical information, the cost of the coverage is exorbitant. According to our analysis, a healthy 50-year-old male can obtain $100,000 in term life insurance for 30 years for less than the cost of $10,000 in burial insurance. Even a 50-year-old man with high blood pressure can obtain the same level of term life insurance for less than the cost of a $10,000 burial policy.
Burial Insurance vs. Term Life Insurance: 50-Year-Old Male Average Rates
| Insurance type | Average cost |
| $10,000 in burial insurance for a healthy male, no medical exam, and no health questions | $46/month |
| $100,000 in term life insurance for 30 years for a healthy male, a medical exam required | $41/month |
| $100,000 in term life insurance for 30 years for a male with high blood pressure, a medical exam required | $44/month |
Even if you have certain health issues, if you don’t require lifelong coverage, term life insurance is usually a better deal.
How Much Does a Funeral Cost on Average?
According to the National Funeral Directors Association, the national median cost of a funeral with a viewing and burial is $7,848 in 2021. The cost of a vault, which is normally required by a cemetery, is not included in that fee. When a vault is included, the median cost is $9,420.
A cremation with a cremation casket costs $6,970 on average across the country.
Remember that these prices do not cover costs such as a monument or marker, an obituary, or flowers.
Breakdown of National Median Funeral Costs
| Type of cost | Median price | Description |
| Casket | $2,500 | The cost for a metal casket, your cost will vary based on the materials you choose. |
| Cremation casket | $1,310 | A fully combustible container can be a traditional casket or cardboard box but cannot have any metal parts. |
| Cremation fee | $368 | If the funeral home does not own a crematory and uses a third party. |
| Urn | $295 | Container to hold cremated remains. |
| Required basic services fee | $2,300 | Covers the funeral home’s time, storage of remains, and overhead expenses. |
| Embalming | $775 | Not required by law, but a funeral home may require it if you hold a viewing. |
| Other preparation of the body | $275 | May include cosmetic reconstruction, hair styling, and dressing of the deceased. |
| Use of facilities/staff for the funeral ceremony | $515 | If you have the ceremony at the funeral home, you can expect to pay this fee. |
| Hearse | $350 | Transporting the remains from the funeral home to the burial site. |
| Service car/van | $150 | Transporting the family and guests from the funeral home to the burial site. |
| Printed materials | $183 | Memorial package and guest book. |
How Much Burial/Funeral Insurance Should I Purchase?
If you simply want a life insurance policy to cover funeral expenditures, be sure you obtain enough insurance to pay for the type of funeral you choose. Funeral expenditures might vary greatly based on the preparations you choose, such as flowers and music.
Burial Insurance Alternatives
Life insurance is used by many people to cover their final expenses. This can be a smart alternative, particularly if you have a substantial policy that will cover your final arrangements as well as any bills and expenses that your family will be responsible for after your death. These policies, however, have different requirements, rules, and focuses than burial or funeral insurance.
#1. Term Life Insurance
Term life insurance protects you for a limited time. Once that time period has expired, you will need to purchase another policy – usually at a considerably higher cost – to remain insured. There is no policy protection if you do not renew your coverage and die. This isn’t a smart alternative for paying for final expenses because we don’t know when we’ll die and can’t estimate if it will happen during the policy’s term.
While you can renew this sort of plan, the costs increase as you get older, so you may end up paying more than if you signed up for burial insurance. If you plan to use term life insurance to pay for your final expenses, check to see if your policy can be changed to whole life or another permanent plan. This choice becomes more expensive as you age, so the sooner you exercise it, the better.
#2. Universal Life Insurance
Most of the time, universal life insurance is not a suitable choice because it is based on interest rates. When interest rates rise, the value of these plans rises; when they fall, it costs more money — in the form of higher premiums — to keep them useful to consumers. You may be able to transfer the value of one of these plans to whole life insurance if you have one of these policies.
#3. Guaranteed Issue Whole Life Insurance
Guaranteed life insurance isn’t always the best option because it’s so expensive. There is no underwriting, and thus, burial insurance companies do not examine the risk of providing coverage to applicants. To compensate for the risk that the insurer is taking, everyone normally pays a substantially greater premium than they would with standard whole-life insurance. Because these are frequently enticing possibilities for people who are having difficulty acquiring life insurance coverage—for example, an 80-year-old man who has had three heart attacks—these plans can be substantially more expensive than other options.
What Is a Graded Death Benefit?
If you pass away within the first two or three years of your policy’s inception, the death benefit will be prorated to your beneficiaries. Instead, they will receive a refund of the premiums they paid, plus a standard bonus of around 10%. However, your beneficiaries will receive the full death benefit amount if you pass away as a result of an accident.
Through the use of graded benefits, life insurance companies can offer protection to those with preexisting conditions who would otherwise be declined. Learn if and for how long the graded benefit period is before applying for a policy that has one. The duration may be as short as two years or as long as three years depending on the policy. Also think about the premium return percentage if you pass away during the graded benefit period. You may find 10% at some businesses and less at others.
What Is Guaranteed-Issue Life Insurance?
Guaranteed issues and simplified issue policies dominate the market for final expense coverage. Both of these underwriting methods are used by insurance providers to establish your premium and eligibility for coverage. Guaranteed issue insurance requires almost no underwriting and guarantees approval of coverage, at a higher cost. You’ll be covered automatically if your age falls within the policy’s allowed range.
However, some health questions may be included in the application process for simplified-issue policies. Simplified-issue policies, if you qualify for them, may not have a graded benefit period, while guaranteed-issue policies do. Mutual of Omaha and SBLI are two examples of insurance providers that provide both types of policies, while other firms may only provide term life or permanent disability insurance (e.g. TruStage).
A guaranteed-issue policy could be your only choice if you’ve been turned down for life insurance in the past due to your health. You should know that if you pass away from natural causes during the graded death benefit period, your beneficiaries will not receive the full death benefit but rather the sum of the premiums you paid into the policy (plus a small percentage).
Life Insurance vs. Burial Insurance
Burial insurance is a sort of life insurance, however, its payout amount is substantially lower than that of ordinary life insurance contracts. This is because burial insurance is only intended to fund last arrangements, whereas life policies are purchased to cover a wide range of needs such as income replacement.
Although burial insurance benefits can be used for other expenses at the discretion of the beneficiary, benefit amounts are designed to cover only the last arrangements. As a result, they are often issued in amounts ranging from $5,000 to $20,000, whereas standard life insurance can provide benefits in the hundreds of thousands of dollars.
Let’s look at the best burial insurance companies of 2023.
Best Burial Insurance Companies
- Mutual of Omaha: The best overall.
- SBLI Life Insurance: The best option for instant-issue policies.
- TruStage: The best for guaranteed-issue policies.
- State Farm Life Insurance: The best option for financial stability.
#1. Mutual of Omaha Insurance Company: Best Overall
Pros
- Policies are offered to anyone over the age of 85.
- Some insurance includes a rider for terminal diseases.
- A+ rating for financial strength
- There is a death benefit of up to $40,000 available.
- Some insurance may not provide a graduated benefit.
Cons
- More grievances than top competitors
For individuals looking for final expense coverage, Mutual of Omaha has a number of appealing benefits. To begin, the organization is A+ rated by AM Best, indicating that it has a great ability to fulfill its insurance duties, including paying claims. You may also apply online for speedy coverage of up to $25,000. However, you can also apply through an agent for a higher coverage level and other benefits (not all burial insurance companies offer this). You can receive a death benefit of up to $40,000 through an agent, and you may be able to buy a policy without a graded death benefit and with a terminal illness rider. Mutual of Omaha is one of the few burial insurance companies that offer the last expense coverage that does not have a graded death payout. It is also the only firm on our burial insurance companies list that provides a terminal illness rider (on some plans) and burial insurance to anyone over the age of 85.
One disadvantage of the company is that it does not perform as well as its competitors in terms of client complaints. According to the National Association of Insurance Commissioners, Mutual of Omaha got significantly more complaints than expected for a firm of its size (NAIC). All of the other burial insurance companies on this list received less.
#2. SBLI Life Insurance – Best For Immediate-Issue Policies
Pros
- Policies with immediate issuance
- Fewer consumer complaints than expected, given the company’s size
- Some insurance may not provide a graduated benefit.
- Up to $35,000 in coverage is available.
Cons
- The graded period for policies with a graded death benefit is three years.
SBLI is a financially sound life insurance firm with few client complaints offering instant-issue burial insurance policies for up to $35,000 in coverage. What’s even better is that the corporation doesn’t impose any specific coverage restrictions on online applications. Mutual of Omaha, for example, offer final expense insurance with up to $40,000 in coverage, but only if you apply through an agent—the maximum death benefit accessible with online applications is $25,000.
You’ll know right away if you’re approved after submitting your online application to SBLI. This is one of the reasons we believe it is the finest option for instant-issue burial insurance. SBLI also offers some final expense policies that do not include a graded death benefit; if authorized, you will learn whether your insurance has one. However, if it happens, keep in mind that SBLI’s graded benefit period lasts three years, which is one year longer than every other firm on our best burial insurance companies list. That means that if you die naturally within that term, your beneficiaries will receive a lower death benefit.
#3. TruStage – Best for Guaranteed-Issue Policies
Pros
- Simple online application
- Fewer consumer complaints than expected, given the company’s size
- Same-day service
Cons
- Every policy has a two-year graded benefit.
TruStage Life Insurance Agency, whose policies are underwritten by CMFG, provides a simple final expense policy that is simple to apply for, which is why it is our pick for the finest business for guaranteed-issue life insurance. There are no health questions, the application is entirely online, and it is simply a few steps long. You will identify your beneficiaries, enter basic personal information, and make your first payment. You’re insured once your payment clears.
If you’ve previously been denied life insurance and want to get something in place without having to deal with health questions, this policy may be worth looking into. Just keep in mind that all policies have a two-year graded death benefit and a maximum death benefit of $20,000.
#4. State Farm Life Insurance – Best For Financial Stability
Pros
- The highest ranking for financial strength
- No. 1 in terms of client satisfaction
- In comparison to its scale, it receives very few consumer complaints.
- Dividends are available to policyholders.
Cons
- The maximum death benefit of $10,000
- You must apply through an agency.
State Farm is a massive life insurance firm. AM Best assigned it an A++ rating for financial strength, the best achievable. That suggests the credit rating agency believes State Farm has a superior ability to honor its insurance obligations, including paying claims. Additionally, State Farm was the highest-ranked firm in J.D. Power’s U.S. forecast for the 2021 Individual Life Insurance Study. Unsurprisingly, according to NAIC data, the company has had very few consumer complaints in recent years. It is also worth noting that its final expense insurance is eligible for dividends.
So why is it not our first choice for the best burial insurance company? Because the only accessible coverage quantity is $10,000, which is half of what TruStage gives and one-quarter of what you can apply for with Mutual of Omaha. Furthermore, you cannot obtain coverage online; you must speak with an agent to apply.
How Do I Know if I Need Burial Insurance?
It is essential to be aware of the fact that funeral insurance is not appropriate for everyone. People are at varying points in their lives and have a varying needs for protection, therefore the types of life insurance that are available to them are as diverse. You should do some research on burial insurance policies, but you should also analyze your other options, such as prepaid funerals, savings accounts, and term life insurance, to see if any of these would be a better fit for the requirements that you and your loved ones have.
When Is the Best Time to Buy Burial Insurance?
There is no one moment that is specifically good or bad to make an investment in burial insurance; nonetheless, you should make the purchase as soon as you have concluded that you require it. As you get older and start to think about the end of your life, one of the things you’ll need to take into consideration is how much money your loved ones will need to pay for your final expenses, including your funeral and any debts that you may have left unpaid. If you haven’t previously put money aside for this purpose, it’s probably time to start looking into different funeral insurance policies that are available.
Are Burial Policies Worth It?
If you plan to cover costs associated with end-of-life care, purchasing burial insurance may be money well spent. If you want to be able to send your children to college, pay off your mortgage, or leave a legacy, you might want to look into other possibilities. For example, term life insurance offers temporary protection at a considerably more affordable premium while still providing a significantly bigger death benefit.
Is It Better to Get Burial Insurance or Life Insurance?
If all you want to do is pay for the funeral and other associated costs, then burial insurance is probably the best choice for you. On the other hand, if you would prefer your loved ones to have additional cash for other things after your passing, you should consider purchasing a life insurance policy instead of a burial plot.
Who Has the Cheapest Final Expense Insurance?
The insurance provider that offers the best coverage at the lowest possible price for a burial can change depending on your profile. For instance, purchasers who are between the ages of 60 and 80, in generally good health, and have no history of smoking are eligible to acquire affordable last-expense plans from either Mutual of Omaha or Transamerica. If you want guaranteed acceptance but still want a low premium, the most affordable policies with a $10,000 cap are offered by Mutual of Omaha. Transamerica offers the most affordable alternative for those who are confident in their ability to respond to health-related queries.
What Are the Benefits of Burial Insurance?
After you die away, if you have burial insurance, the policy will pay for the expenditures associated with your funeral or cremation. It is up to the discretion of the beneficiary to decide how it will be used, however, it can also be used to pay off obligations such as credit card payments, mortgage loans, or medical bills.
Burial Insurance FAQs
What is the difference between burial insurance and life insurance?
A term life insurance will expire if you outlive the policy’s term while burial insurance is typically a whole life policy that lasts until you pass away.
How long does it take for burial insurance to take effect?
The average life insurance payout can take as short as two weeks and as long as two months. However, the timetable is subject to a number of variables.
How is burial insurance paid?
The policy amounts are paid for in monthly installments directly to the funeral home. Pre-paid funeral plans provide a way for people to pay for their funeral arrangements before they pass.
Related Articles
- Life insurance for seniors: What is the affordable life insurance for seniors in 2023?
- WHOLE VS TERM LIFE INSURANCE: Which is Better?
- BASIC LIFE INSURANCE: Definition and What It Covers
- FINAL EXPENSE: Insurance Coverages & Insurance Companies
- How To Open A Funeral Home In 2023: Detailed Guide
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