How to Get Affordable Funeral Insurance
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Funeral Insurance for Seniors
You want to protect your family from the high costs of funeral expenses, but how? Affordable funeral insurance is a good option for seniors. However, shopping for funeral insurance (also known as burial insurance, final expense insurance, and preneed insurance) can be difficult.
There are many options to choose from. But how do you pick the best policy for your particular situation? We can help.
The Secret to Buying Funeral Insurance
The smart way to shop for funeral insurance is to determine the type of funeral you want for a price you can afford. You can do that with the following 4 simple steps.
- Create a funeral plan with your final wishes and get a cost estimate for it.
- Determine how much you can afford to pay for insurance, that is, a monthly budget.
- Find out if your budget will buy enough insurance to cover your funeral cost.
- If your budget is sufficient, you just need to choose a policy. If the insurance you can afford will not cover your funeral costs, rethink your funeral plan or decide how to make up the shortfall.
In short, focusing on affordability is the key to buying funeral insurance. That might seem obvious, but buyers often purchase more funeral insurance than they can afford. Their policy lapses, and they lose both coverage and the amount they have already paid. Learn more about shopping for funeral Insurance.
Shop Wisely with our Funeral Insurance Finder
Our Funeral Insurance Finder provides the information you need to determine the coverage you can afford and the tools to manage your funeral costs.
Start Your Shopping for Funeral Insurance
Our Funeral Insurance Finder is not your typical insurance quoter. Rather than just giving you a price, it will provide you with the information you need to find an affordable funeral insurance policy. It takes only a few minutes to complete and it’s totally free. To take advantage of this valuable resource:
- Enter information about the insured in the form below.
- Create a simple Quick Plan to estimate your final expenses.
- Enter a monthly budget for funeral insurance.
- Save your plan.
- Once you’ve finished these steps, we’ll send you an analysis of what your budget will buy.
Information About The Insured
Does Funeral Insurance Persistency Matter?
The insurance industry measures the percentage of policies that stay active as a “persistency rate.” For final expense/burial insurance policies, a 75% to 80% persistency rate is considered good. That may be good for the insurance company, but it is not so good for the 20% to 25% of their customers whose policies eventually lapse. Not all insurance companies are achieving these goals, and their persistency rate is worse.
Persistency rates for preneed insurance policies are better than final expense/burial insurance policies. Preneed policies are associated with prearranged contracts with funeral homes. Over 50% of these policies are paid upfront in a single lump sum payment to get a price guarantee as a hedge against inflation. These upfront payments improve the overall persistency rate of preneed policies, but multi-pay preneed payment plans of 1, 3, 5 and 10 years do have lower persistency rates.
Why does persistency matter to you? It serves as evidence that people often purchase policies they cannot afford. We point that out to stress the point that affordability is the key factor in your decision to purchase a funeral insurance policy. In other words, it doesn’t do you much good to purchase a policy if you won’t be able to make the payments.
So why are we talking about persistency?
Our approach is somewhat different than what you may have seen before. Rather than ask you how much insurance you want your policy to represent, we ask you what your budget is. That’s because we think it’s important to consider how much you can really afford. That brings us back to persistency. It doesn’t do you any good to buy a policy that you won’t be able to pay for.
How much insurance do I need?
There’s no right answer to the question of how much insurance you need. Ideally, when you buy funeral/burial insurance you want it to cover the cost of the funeral. But as we have discussed, it doesn’t help you if you buy a policy you can’t afford. That’s why we start with the right budget for you and work our way back. Isn’t that how you think about a major purchase like a car or a house?
