Owning a life insurance policy is one of the best ways to provide financial protection to your loved ones should you unexpectedly pass away. With proper planning, the death benefit proceeds your family would receive from a life insurance policy could provide them with the financial security to maintain their same standards of living for many years.
A life insurance plan is almost always a must-have for younger families. It can create a replacement of a deceased spouse’s income. It can help ensure that your loved ones can continue to pay household expenses, pay off debts and keep up with monthly mortgage payments. If you have small children, it can also help pay for childcare expenses and even provide for future education.
While life insurance can offer several benefits to younger families, it can also benefit seniors. For example, one of the most popular senior life insurance plans, referred to as burial insurance, provides an affordable, convenient way to avoid leaving your loved ones with the burden of covering your burial costs.
Burial insurance is a life insurance policy designed to offer just enough financial protection to cover end-of-life expenses such as burial and funeral services. Because of their popularity, several life insurance companies offer these plans to their senior market.
In fact, according to a recent survey conducted by LIMRA as to the top reasons consumers buy life insurance, the number one reason for purchasing coverage was to cover burial and final expenses, making a strong case as to why burial insurance is such a popular life insurance option.
However, finding the right policy does require you to compare all your options, as not all plans are equal, and there is a lot to learn about the insurance plan.
The following guide covers everything you need to know about burial insurance for seniors, including standard policy features, advantages, disadvantages, rates, and our expert recommendation on the best burial insurance companies in 2023.
Why Seniors Might Need Life Insurance
Life insurance is one of the best tools to protect your loved ones from the threat of financial risk if you were to pass away, regardless of your age. Financial risks such as the loss of income, debt accumulation, and mortgage payments can often be seen as the highest risks in your younger years.
As you enter your senior years and have paid down debts, the significant financial risk you once had in your younger years is often reduced. In turn, a large amount of life insurance is generally not needed.
Instead, the focus will often shift towards ensuring that the more minor financial risks are still covered. These risks, although small, can still have a costly impact on your loved ones if you were to pass.
For example, many people don’t realize the cost of a funeral until it’s left to the family. Although prices can fluctuate based on where you live and the services you choose, the Nation Funeral Directors Association NFDA reports that the average funeral with a viewing and a burial is about $7,848.
These prices are only forecasted to increase based on the increasing inflation rate. Cremation costs have also increased over the years, with the average cost now ranging from $4,000 to $7,000.
Having a small life insurance policy, such as a burial insurance policy, can alleviate leaving your loved ones with financial burdens, such as funeral and burial costs, along with other common end-of-life expenses, such as household expenses, car loans, medical bills, and other small remaining debts.
What is a Burial Insurance Policy for Seniors?
Burial insurance is a type of life insurance policy commonly marketed to seniors due to how the coverage is designed. The purpose of a burial insurance policy is for the death benefit to cover the costs of end-of-life expenses such as a funeral and any other small remaining debts that would be passed onto loved ones to worry about.
There can be some confusion regarding burial insurance for seniors due to the different names used for marketing the insurance coverage. However, the common name for burial insurance is final expense insurance.
Other names for burial insurance often include:
- Funeral insurance
- Pre-need insurance
- Cremation insurance
- End-of-life insurance
- Guaranteed issue insurance
Insurance companies that offer coverage for seniors to help pay for final expenses will often use different names to market and drive awareness of how the insurance coverage can help with specific needs that require financial protection. However, regardless of the name used, these plans are almost always a simplified issue “no medical exam” whole life insurance policy.
Whole life insurance means that the coverage lasts your entire life. In addition, to a lifetime of coverage, funeral insurance plans also provide a valuable but smaller amount of death benefit protection, typically ranging from as low as $1,000 to a maximum of $50,000, payable to your beneficiary in one tax-free lump sum payment upon your passing.
Because these plans are primarily designed for seniors, life insurance companies are much more lenient on underwriting, meaning you can apply and be approved for a policy even if you are not in good health.
Simplified issue underwriting means that no medical exams or labs are needed to apply. Instead, applications will generally consist of a series of health questions used to determine your eligibility.
Burial life insurance plans also often include a streamlined application process. You can apply online or many times over the telephone and receive a decision in hours or within a few days.
Main Features of a Burial Insurance Policy
The main features to become familiarized with when looking for a burial life insurance policy include the following:
- Age Limits
- Contract Length
- Coverage Amounts
- Death Benefit Types
- Policy Riders
- Medical Exam Requirements
Age Limits
The age limits to be eligible for a policy vary from one life insurance company to the next. However, most final expense life insurance plans are often available to applicants ages 50 to 85.
Age is very important when applying for any life insurance as it impacts the cost of the policy. Older applicants will always pay more for their insurance, as the insurance company has a greater risk of potentially paying a death benefit based on mortality data.
For example, a 50-year-old male can expect to pay about $75 per month for $25,000 of burial insurance, whereas a 70-year-old male may pay closer to $185 per month for the same coverage. Therefore, it is always best to try and purchase a plan in your early years and lock in your rates which will be guaranteed to last throughout the entire life of the contract.
Contract Length
All life insurance plans have contract lengths, including whole life insurance. Since burial insurance is a whole life insurance and falls under the category of permanent life insurance, it has a maturity age for a contract length.
The standard maturity age for most burial policies will be when the policyholder reaches the age of 100 or 120, depending on the provider.
While it is not common for most people to reach the maturity age of their life insurance contract, if you were to outlive your contract, the insurance company would payout the full death benefit to the policyholder, and the contract would end.
Coverage Amounts
The minimum and maximum amount of coverage for burial insurance typically range from $1,000 to as high as $50,000. However, some burial insurance companies may start at a higher minimum amount, such as $2,500 or $5,000, and offer a maximum of $25,000. Maximum coverage amounts may also be limited based on your age at the time of the application.
All final expense insurance plans include limited coverage amounts and policy riders, which helps make them affordable to seniors. Remember, the coverage amounts will be much smaller than traditional life insurance plans as they are designed to provide coverage for funeral and final expenses.
These policies do not provide comprehensive coverage for all your life insurance needs. However, a traditional whole life or term insurance policy can offer a greater range of coverage for replacing lost income, mortgage payments, and other significant expenses.
Death Benefit Types (Important Information)
Most burial insurance policies offer two types of death benefit plans referred to as:
- Level death benefit plans (Day one coverage)
- Graded death benefit plans (2-year waiting period)
Which of the two death benefit options you qualify for will significantly depend on the answers to the health questions listed within the application.
Level death benefit plans come with full coverage from the first day the policy becomes active. If you pass at any time, your beneficiaries receive your policy’s full death benefit amount.
Graded death benefit plans pay a full refund of all premiums plus interest if death occurs within the first two policy years of owning your policy. It is often called “life insurance with a waiting period.”
Most graded death benefit options include a two-year waiting period before the full death benefit becomes payable. That means if your death occurs within the first two policy years of any natural cause, your beneficiary will not receive the full value of your policy.
Instead, depending on the provider, your beneficiary may receive a full refund of all premiums plus interest or, in some cases, a percentage of the total benefit.
For example, some graded burial insurance plans may offer a modified death benefit that pays 30% of the total death benefit if death occurs during the first year and 70% if death occurs in the second year.
However, the most common graded death benefit payouts are a refund of all premiums plus 10% interest on the premiums already paid to the provider.
The full death benefit is payable starting in the third year, and the graded benefit falls off the insurance coverage, turning into a level benefit plan.
(Important) The only exception to a full payout of the death benefit during the graded period is if the death was caused by accident. Accidental death during the graded benefit period is eligible for a full payout of the death benefit.
Cash Value
Whole life insurance plans, such as burial insurance, are guaranteed to grow in cash value. This is because, for every premium payment paid towards the insurance policy, the insurance company places a predetermined portion of each payment into the policy’s cash value account.
Throughout the contract, the cash value will accumulate at a guaranteed rate, eventually totaling the policy’s full death benefit. If you reach the maturity age of the life insurance contract, the cash value is guaranteed to be equivalent to the full death benefit, which is then paid to the policyholder.
A policy that can grow in cash allows policyholders to borrow from the cash account if needed. Borrowing from your policy’s cash account will act as a policy loan. There is no timeframe for paying back the loan, but an annual interest rate will be charged to any unpaid loan balance.
Failure to pay back a policy loan before passing away would result in the unpaid balance being deducted from the death benefit.
Policy Riders
Burial insurance plans do not always offer a wide selection of policy riders because they generally add extra cost to the coverage. To keep costs down and affordable to seniors, policy riders are often limited to the following:
- Accidental Death Benefit Rider
- Accelerated Death Benefit Rider
- Child Term Life Insurance Rider
The accidental death benefit rider pays an additional death benefit in the event of accidental death. This rider doubles the death benefit and increases your base premium should you add the policy rider to your life insurance plan. It is also called a double indemnity rider.
The accelerated death benefit rider is also commonly called the terminal illness rider. This is because it pays a portion of the death benefit if the policyholder receives a diagnosis of a terminal illness with a life expectancy of 12-24 months to live.
In addition to a potential payout due to a qualifying terminal illness diagnosis, most accelerated death benefit riders will allow early access to the death benefit if the policyholder is permanently confined to a nursing home.
There are no restrictions on how the money is used, but it can help cover medical expenses related to the illness or help pay for everyday living expenses. Most accelerated death benefit riders are added to coverage without an extra cost.
The child term life insurance rider allows parents and grandparents to add a child to their life insurance policy. The child would then receive temporary life insurance protection under the adult’s policy until the child reaches the age of 25 with most providers.
Medical Exam Requirements
Nearly all burial insurance options are available without a medical exam and a streamlined underwriting process. You can often apply for a policy and receive a decision in days or even hours instead of waiting for an exam.
Insurance companies rely on answers to health questions on the application to make an offer for coverage. They also use data from third parties to verify your health status.
For example, many details come from the Medical Information Bureau (MIB), a service used by all life insurance companies to prevent application fraud. A MIB report contains medical information about any past insurance application applied for within the last seven years.
Insurance companies will also look at prescription drug history, driving record, and in some cases, medical records to assess the overall risk of insuring you.
The findings in the reports obtained by the company’s underwriters are used to match responses to health questions within the application to help determine if approval for a policy can be made.
Premiums
Your premium payments are guaranteed to remain the same fixed price for the entire contract duration. So even if you were to experience a change in health years later, the insurance company would never raise your rates.
Premiums are typically paid monthly through your checking account. However, a few providers will also allow premiums to be paid with social security benefits if preferred.
Helpful Tips On How Seniors Can Shop for Burial Insurance
Finding the best burial insurance plan should involve setting aside time for research. Multiple insurance companies offer this type of coverage, and not doing your research and simply choosing the first company you come across can potentially have costly consequences.
The most important tip we can provide when purchasing burial insurance, especially for seniors, is to work with an experienced licensed agent. While the internet is filled with helpful resources, an agent is likely your best resource in finding a policy that fits your exact coverage needs, medical background, and your budget.
Here are a few buyers tips that will help prepare you for purchasing a burial insurance policy:
- First, decide how much coverage you need.
- Then, obtain quotes from several companies.
- Finally, work with a licensed final expense insurance agent.
Decide How Much Coverage You Need
Determining your funeral plans should be the first step to shopping for burial insurance. Deciding whether you want to be buried or cremated and the services you want to be added to your funeral is a good starting point for determining how much coverage you will need.
Suppose you’re having trouble figuring out how much a funeral will cost. In that case, we can tell you that annual data from the National Funeral Directors Association reports that the average funeral costs are just under $8,000.
The data, however, does not include costs associated with the cemetery, such as the cemetery plot and headstone prices, so you will need to factor those expenses in. Also, keep in mind that prices are likely to rise due to inflation and vary from state to state.
Obtaining an estimate on services from your local funeral home can help provide a more accurate determination of how much coverage you need. Funeral homes have to offer you a general price list of their services which the Federal Trade Commission enforces. You can usually find pricing on the funeral home’s website if they have one.
Although the main focus of a burial policy is to help cover funeral costs, no rule requires the death benefit to be solely used on burial costs. Your burial policy may also cover medical bills or other debts. Make sure to factor in current and potential financial obligations you would like your policy to cover.
Obtain Quotes from Several Companies
After determining how much burial coverage you will need to cover all your final expenses, you will want to start looking into rates. When shopping for a life insurance policy, it is always important to compare quotes from multiple companies, as rates can differ significantly from one company to the next.
Take, for example, the monthly rates for a 65-year-old male interested in a $10,000 final expense insurance policy. If we were to run a comparison quote from over two dozen final expense insurance companies, the most affordable provider offered their coverage for $35 per month. The most expensive provider offered the same coverage for $53 per month. That is an $18 per month difference from the cheapest to the most expensive company.
While $18 per month may not seem like a lot of money, keep in mind that your life insurance coverage is designed to last a lifetime, and that $18 per month over several years can add up. Therefore, requesting rates from multiple providers is vital to getting the best price for your burial policy.
Obtaining burial insurance quotes can be achieved in a few ways. First, suppose you have already researched and created a list of companies offering senior burial insurance plans. In that case, you can contact each of those companies directly to request quotes.
However, contacting each life insurance company directly for quotes can be time-consuming. Another option, rather than contacting each company directly to obtain a quote, is to utilize an online quote comparison tool.
Several websites, such as No Medical Exam Quotes, offer online quote tools that instantly display the rates from dozens of burial insurance companies all at once.
By entering information about yourself, such as your age and the amount of coverage you would like, you are instantly provided with real-time rates from over a dozen final expense life insurance companies giving you the advantage of knowing which company can offer you the best rates for your life insurance coverage.
Another important tip we can give all seniors is not to commit to the first television or direct mail piece advertising funeral insurance without checking the prices and policy features of at least five or more providers.
The marketing behind those ads can make it very tempting to respond and lock into a policy. However, we have seen time and time again that there are often much better options if you were to take the time to explore all your options.
Work with a Final Expense Insurance Agent
The internet is an excellent source to learn about burial insurance. It can also help provide access to tools that instantly compare rates from multiple life insurance companies.
As helpful as the internet can be, you must remember that a quote is only a quote until the insurance company has approved you. Therefore, your final rates could differ significantly from your initial quote based on the underwriting outcome.
The best way to shop for burial insurance as a senior will be with the help of a life insurance agent. An experienced life insurance agent specializing in insurance coverage for funeral planning can simplify the entire process of obtaining the right policy the first time.
However, not all life insurance agents are the same, nor can they offer the same coverage options. There are two types of life insurance agents, referred to as captive and independent agents.
The type of life insurance agent you want to work with is an independent agent. Independent agents are self-employed. They can contract and shop rates from multiple providers.
In contrast, captive agents are employed by a single company, such as a State Farm or Farmers Insurance agent. These agents are only allowed to offer the insurance products and rates from the company they are employed with.
The easiest way to determine whether an agent is captive or independent is to ask if they can offer you options from multiple companies.
While captive agents will be very knowledgeable about the products their company offers, the major disadvantage is that they cannot shop your coverage to ensure you get the best burial insurance plan based on your health history and individual needs.
Completing an Application for Burial Life Insurance
Once you have researched insurance providers and selected a burial policy that meets your needs and budget, you must complete an application to qualify for the coverage.
The application process will vary from provider to provider, but in most cases, you will work with an agent to complete your application for coverage online or by telephone. Paper applications are also generally available, but most agents will advise against them as it often slows down processing and approval time.
When completing an application for final expense insurance, you will often be required to provide the following information:
Personal Information: Your application will begin with personal information such as your full name, social security number, home address, and contact information. This information is primarily used to confirm your identity and send important policy notices such as billing and statements.
Coverage Amount: Your coverage amount is the total amount of death benefit your policy would pay your beneficiary upon passing and completing the death claim. You will have to put down how much coverage you are applying for on the application, but you can change the amount before finalizing your policy if needed.
Beneficiary: The beneficiary section of the application will contain a section for both a primary and contingent beneficiary of your policy. Naming a primary beneficiary is mandatory as this is the individual or organization, such as a funeral home, who would receive the death benefit upon your passing.
A contingent beneficiary is a secondary beneficiary that would receive the death benefit proceeds should the primary cannot. Naming a contingent beneficiary is not required but is often recommended so that death benefit proceeds do not have to go through a probate process when collected by another party of the deceased insured.
You are allowed to name multiple beneficiaries to your life insurance policy. However, you will be required to list how much of the death benefit will be paid to each beneficiary named on the life insurance contract. You may also need to specify their relationship to you and provide a mailing address, phone number, email address, date of birth, and social security number.
Medical History: The next part of the application will consist of a series of health questions. The health questions listed on the application are likely to be broken into groups starting with those referred to as “knockout” questions. Knockout questions are generally those that the insurance company would classify as high-risk. If you answer “yes” to any of them, you will not be eligible for coverage.
If the company that you are applying for burial coverage with offers a graded benefit plan, then there will be a second series of medical questions that, if you answer “yes” to, you may be eligible for the company’s graded benefit plan.
If you answer “no” to all health questions, you will likely be eligible to receive a level benefit plan that offers no waiting period. Along with health questions, most applications will ask that you provide a list of currently prescribed medications, tobacco use within the last twelve months, and your height and weight, as these are all underwriting requirements.
Premium Payments: When completing your application, you must choose how to make premium payments. Depending on the provider, you may pay monthly, quarterly, bi-annually, or annually. Premiums can also be set up to draft automatically from your bank account.
If you currently receive social security benefits, a few providers allow you to have your premium payments automatically drafted directly from your social security benefits should you choose that option.
Signatures: Upon completing your application for coverage, you will need to sign off on it before it is sent to an underwriter for underwriting. Signing the application confirms that the information you have provided is true and accurate to the best of your knowledge. It also permits the insurance company to obtain specific documentation needed to help with the underwriting process.
Depending on how your application was completed, you may have the option to sign your application by voice signature, electronically through email, or a wet signature if you have chosen a paper application.
Underwriting and Approval Process
Once your application for burial coverage has been completed, and all required forms have been signed, the insurance company will begin the underwriting process. Burial insurance policies do not require a medical exam to qualify. Instead, they are underwritten using a simplified issue underwriting process to help speed up the decision-making time.
Soon after an application has been submitted to the insurance company, it will be assigned to an underwriter for review. The underwriter will review all the information you have submitted on the application, along with your answers to the health questions, to determine eligibility for a policy.
To help assist in underwriting an application for coverage, the underwriter will utilize the assistance of third-party consumer data sources to verify application responses. These resources will generally come from your MIB record, which provides data from any previously applied insurance applications, and a prescription history check which shows a list of any prescribed medications.
In some cases, you may be asked to complete a telephone interview if the underwriter needs additional clarification to an application response. In other cases, medical records could be ordered from your primary care physician to help the underwriter determine the level of risk to any diagnosed medical conditions.
When the underwriter has completed their review of the life insurance application, a decision as to if a policy can be issued will be made. The total time it takes to receive an approval answer will vary, but on average, it tends to take 1-2 weeks. If you are in good health, many simplified issue plans can result in instant approval.
Upon approval, you will be notified by either the insurance company or your agent confirming your coverage and final rate. If you provide payment details during the application process, the insurance company can instantly process the first premium payment upon accepting your policy and activating your coverage.
If you are denied coverage, you will be notified with a reason for the denial. If denied a burial policy, you can attempt to work with a licensed insurance agent to explore alternative solutions or apply with a different insurance company. If the reason for the denial was a health issue, you might want to consider applying for a guaranteed acceptance plan.
Guaranteed Issue Life Insurance Plans
A guaranteed issue life insurance plan is another form of final expense life insurance designed for those with high-risk health issues. There are no health questions on the application, and approval is guaranteed. However, if you choose a guaranteed issue life insurance plan, there is an automatic two-year graded death benefit waiting period.
Since these plans accept everyone regardless of past or current health, they can be much more expensive than a policy that asks for medical history to qualify. Even compared to a policy with a two-year graded death benefit that asks health questions, you will pay more with a guaranteed issued policy that does not ask any health questions, as you cannot be denied coverage.
How Much Does Burial Insurance for Seniors Cost?
The cost of a burial insurance policy for seniors will depend on various factors. Like any life insurance plan, factors such as age, gender, tobacco use, coverage amount, and overall health all go into the pricing of a policy.
Rates will also vary among competing providers that offer burial insurance plans. For example, you may find a provider offering policies as low as $10 per month, while other providers may provide the same coverage but at much higher rates. That factor alone is one of the most important reasons you should always shop around and compare rates from multiple insurance providers.
In general, burial insurance offers relatively low monthly premiums as the coverage amounts are smaller and are designed to cover end-of-life expenses. In addition, once you purchase a policy, your rates are guaranteed to stay the same for the entire time your policy remains active.
To help give you an accurate idea of how much burial insurance for seniors will cost, we have put together the following rate chart with the monthly cost of a $10,000 final expense policy for various age groups. The monthly rates also reflect the pricing for both a level benefit plan and a graded benefit plan with a two-year waiting period.
Burial Insurance Rate Chart for Seniors
| Age | Gender | $10,000 Level Benefit | $10,000 Graded Benefit |
|---|---|---|---|
| Age 50 | Male | $30.55 per month | $40.09 per month |
| Age 50 | Female | $24.23 per month | $30.22 per month |
| Age 55 | Male | $35.76 per month | $45.35 per month |
| Age 55 | Female | $27.60 per month | $37.29 per month |
| Age 60 | Male | $38.50 per month | $56.87 per month |
| Age 60 | Female | $32.71 per month | $42.51 per month |
| Age 65 | Male | $47.78 per month | $68.44 per month |
| Age 65 | Female | $40.77 per month | $49.93 per month |
| Age 70 | Male | $59.85 per month | $86.69 per month |
| Age 70 | Female | $52.18 per month | $63.87 per month |
| Age 75 | Male | $97.30 per month | $113.21 per month |
| Age 75 | Female | $70.94 per month | $88.47 per month |
| Age 80 | Male | $136.34 per month | $156.82 per month |
| Age 80 | Female | $98.43 per month | $117.88 per month |
| Age 85 | Male | $192.74 per month | $237.51 per month |
| Age 85 | Female | $119.50 per month | $179.22 per month |
The above rate chart represents the monthly cost of burial insurance plans for males and females ages 50-85. The rates have been obtained from our online quote tool and are accurate as of 2/6/2023.
Best Burial Insurance for Seniors In 2023
As an independent agency, No Medical Exam Quotes has contracts with over two dozen highly rated life insurance providers, many of which offer senior burial insurance plans.
The ability to contract with multiple life insurance providers gives us the best opportunity to find the perfect match of coverage for our customers based on their needs, health, and budget.
While we have an extensive lineup of burial insurance providers in which we could list every provider we work with (Best No Exam Burial Insurance Companies in 2023), we feel it is not entirely necessary.
Based on our experience working with seniors and their life insurance needs, there tend to be five providers that always stand out in front time and time again when it comes to final expense life insurance.
The five burial insurance providers you will find below are all companies we have much experience working with and who come highly recommended when it comes to senior life insurance for final expenses.
Mutual of Omaha
- Founded
- 1909
- Headquarters
- Omaha, Nebraska
- AM Best Rating
- A+ (Superior)
| Features | Level Plan | Graded Plan |
|---|---|---|
| Policy Type: | Whole Life Insurance | Whole Life Insurance |
| Age Availability: | 45-85 | 45-80 |
| Coverage Amounts: | $2,000-$40,000 | $2,000-$20,000 |
| Death Benefit Option: | Day One Coverage | 2-Year Waiting Period |
| Contract: | Permanent | Permanent |
| Premiums: | Fixed | Fixed |
| Cash Value: | Guaranteed | Guaranteed |
| Policy Riders: | Terminal Illness Nursing Home Confinment Accidental Death | None |
| State Availability: | All States (except New York) | All States (except AR, MT, NC and NY) |
Look at any best burial insurance list, and you’re likely to see Mutual of Omaha and its Living Promise senior life insurance plan at the top of the list.
With an AM Best rating of A+, competitive rates, fair underwriting, and both a level and graded death benefit option, it is why Mutual of Omaha has also made our list as one of the best companies for burial insurance for seniors.
Much of what we like from the life insurance plan offered through Mutual of Omaha comes primarily from the level benefit plan, where you can apply for up to a maximum of $40,000 versus $25,000 with the graded benefit plan. Issue ages are also higher, allowing a healthier applicant to obtain a policy up to age 85.
Also included with the coverage is an accelerated death benefit for terminal illness which allows you early access to the policy’s death benefit if you are diagnosed as having a terminal illness or required to remain confined to a nursing home.
Pros:
- Well-known insurance company with a strong financial stability outlook from AM Best
- Rates on their level benefit plan are highly competitive
- Included living benefit rider for terminal illness diagnosis and optional accidental death benefit rider on the level benefit plan
- Up to $40,000 in coverage, allowing you to cover more than funeral costs
Cons:
- The graded benefit plan limited to $20,000 in coverage
- Specific health risks may restrict you to a 2-year graded plan, whereas other providers may approve you for a level plan
- The graded benefit plan offers no policy riders
- Underwriting is fair but can but tougher on many health risks resulting in a graded benefit plan rather than a level benefit plan
The following health conditions may qualify for a level benefit policy with Mutual of Omaha versus a graded benefit policy with a two-year waiting period.
- Aneurysms
- Asthmas – seasonal
- Cancer History – cancer free over 24 months
- Defibrillator
- Depression
- Diabetes
- Drug Abuse
- Heart Attack
- Heart Bypass
- Pacemaker
- PTSD
- Seizures
- Stroke
- Stent Placement
*It should be noted that this is not a complete list of medical conditions. To qualify for a level benefit policy with the above health conditions, most require 24 months since diagnosis. Other underwriting factors, such as prescribed medications, height and weight standards, and other underwriting factors, can affect the outcome of an approval.
To apply for Mutual of Omaha’s senior burial insurance plans, you must work with independent organizations such as No Medical Exam Quotes.
Paper and electronic application processing are the most common ways to complete the life insurance application. In addition, some applicants may be required to complete a telephone interview.
Total time to complete application: 15-20 minutes
Total time to receive approval: 2-3 business days
Transamerica
- Founded
- 1906
- Headquarters
- Cedar Rapids, Iowa
- AM Best Rating
- A (Excellent)
| Features | Level Plan | Graded Plan |
|---|---|---|
| Policy Type: | Whole Life Insurance | Whole Life Insurance |
| Age Availability: | 0-85 | 18-80 |
| Coverage Amounts: | $1,000-$50,000 (Max depends on age) | $1,000-$25,000 |
| Death Benefit Option: | Day One Coverage | 2-Year Waiting Period |
| Contract: | Permanent | Permanent |
| Premiums: | Fixed | Fixed |
| Cash Value: | Guaranteed | Guaranteed |
| Policy Riders: | Terminal Illness Nursing Home Confinment Accidental Death Childrens Term | None |
| State Availability: | All States | All States |
Transamerica is a well-known, financially stable life insurance provider that offers a solid senior burial insurance plan.
There is a level benefit plan with two preferred and standard risk classes, each providing first-day coverage. In addition to the level benefit plan, they also offer a graded benefit option for applicants who may not meet the underwriting qualifications for day-one coverage.
Much of what we like from Transamerica and its final expense life insurance coverage comes from the level benefit plan, specifically those who qualify for the preferred risk class, as the rates are incredibly competitive, often within the top three for the lowest price among the larger providers.
The level benefit plan also offers a broader range of death benefit options, with a maximum amount of $50,000 for younger applicants and tapering to lesser amounts for older applicants.
Policyholders of the level benefit plan will also receive a policy rider with their coverage which can allow for early access to the death benefit if diagnosed with a terminal illness or permanent confinement to a nursing home.
Two optional policy riders can be added to the coverage for an additional cost. These optional policy riders include an accidental death benefit rider and a children’s and grandchildren’s term insurance rider.
Lastly, Transamerica is one of the few that allows its senior policyholders to pay for their coverage utilizing their social security benefits.
Pros:
- Their preferred risk class rates are some of the best for day-one coverage, especially for seniors over the age of 70
- They offer the option to pay premiums directly from your social security payments
- Preferred and standard risk classes for first-day full coverage
- Good choice with many pre-existing health conditions
- Children’s and grandchildren’s rider allows for up to nine children to receive coverage under one policy
Cons:
- The application is lengthy and time-consuming
- Approval can take several days
- Not the best option if you are taking prescribed pain medications
The following health conditions may qualify for a level benefit policy (Preferred or Standard) with Transamerica versus a graded benefit policy with a two-year waiting period.
- Angina – 24+ months
- Aneurysms – 24+ months
- Asthma
- AFIB – 24+ months
- Bi-Polar
- Bronchitis
- Cancer History – 24+ months
- Cardiomyopathy
- Crohn’s Disease
- COPD
- Defibrillator – 24+ months
- Depression
- Diabetes
- Emphysema
- Heart Attack – 24+ months
- Heart Bypass – 24+ months
- Hepatitis B or C – 24+ months
- Irregular Heart Rhythm
- Isosorbide Mononitrate Usage – 24+ months
- Kidney Renal Insufficiency
- Multiple Sclerosis
- Nitroglycerin Usage – 24+ months
- Pacemaker – 24+ months
- Parkinson’s
- Stroke – 12+ months
- Pacemaker – 12+ months
- Parkinson’s
- PTSD
- Sarcoidosis
- Schizophrenia
- Seizures – 24+ months
- Stent Placement – 24+ months
- Strokes – 12+ months
- Systemic Lupus Erythematosus
- TIA – 12+ months
- Ulcerative Colitis
*It should be noted that this is not a complete list of medical conditions. Other underwriting factors, such as prescribed medications, height and weight standards, diagnosis of multiple health conditions, and other underwriting factors, can affect approval.
To apply for a Transamerica senior burial insurance plan, you must work with independent organizations such as No Medical Exam Quotes.
Transamerica offers both paper and electronic application processing.
Total time to complete application: 40-60 minutes
Total time to receive approval: 3-5 business days
Aetna (Accendo)
- Founded
- 1853
- Headquarters
- Brentwood, Tennessee
- AM Best Rating
- A (Excellent)
| Features | Level Plan | Graded Plan |
|---|---|---|
| Policy Type: | Whole Life Insurance | Whole Life Insurance |
| Age Availability: | 40-89 | 40-75 |
| Coverage Amounts: | $2,000-$50,000 (Max depends on age) | $2,000-$25,000 |
| Death Benefit Option: | Day One Coverage | 2-Year Waiting Period |
| Contract: | Permanent | Permanent |
| Premiums: | Fixed | Fixed |
| Cash Value: | Guaranteed | Guaranteed |
| Policy Riders: | Terminal Illness Accidental Death Childrens Term | None |
| State Availability: | All States (Except New York) | All States (Except New York) |
Aetna has teamed up with Accendo Insurance Company to issue a burial insurance plan to seniors in both a level and graded benefit options.
Accendo coverage makes our list as one of the best burial insurance options for multiple reasons beginning with their higher issue ages. While most providers will cap their issue age to 85, Aetna offers coverage to seniors up to age 89 as long as they qualify for a level benefit plan.
Regarding coverage features, Aetna burial insurance plans offer a few standard policy riders, such as an accelerated death benefit for terminal illness, accidental death, and a children’s term insurance rider in which grandparents can add life insurance for their grandchildren from their policy.
We also like Aetna for specific health conditions as well. For example, Aetna does not factor in height and weight in their underwriting for applicants who may be overweight. They are also a good option for seniors that may have had an issue with specific heart issues, diabetes, Parkinson’s, and COPD, to name a few.
Pros:
- The level plan offers coverage up to age 89
- Optional children’s term insurance rider can provide grandchildren with up to
- Competitive pricing for applicants that qualify for the standard risk class
Cons:
- Healthy applicants are likely to find better rates with other providers
- Although Aetna offers up to $50,000 in coverage, older applicants will be limited to lesser amounts
The following health conditions may qualify for a level benefit policy (Preferred or Standard) with Aetna Accendo versus a graded benefit policy with a two-year waiting period.
- Angina – 24+ months
- Aneurysms – 24+ months
- Asthma
- AFIB
- Bi-Polar
- Bronchitis
- Cardiomyopathy
- COPD
- Defibrillator – 12+ years
- Depression
- Diabetes
- Emphysema
- Heart Attack – 24+ months
- Heart Bypass
- Hepatitis B or C – 24+ months
- Irregular Heart Rhythm
- Multiple Sclerosis
- Stroke – 12+ months
- Systemic Lupes
- Obesity
- Pacemaker – 12+ months
- Parkinson’s
- PTSD
- Schizophrenia
- Seizures – 12+ months
- Stent Placement – 12+ months
- Strokes – 12+ months
- Systemic Lupus
- TIA – 12+ months
*It should be noted that this is not a complete list of medical conditions. Other underwriting factors, such as prescribed medications, height and weight standards, and other underwriting factors, can affect the outcome of an approval.
To apply for an Aetna Accendo senior burial insurance plan, you must work with independent organizations such as No Medical Exam Quotes.
Aetna offers both paper and electronic application processing.
Total time to complete application: 30-40 minutes
Total time to receive approval: Instant approval potential but on average 3 business days
Foresters
- Founded
- 1874
- Headquarters
- Toronto, Ontario
- AM Best Rating
- A (Excellent)
| Features | Level Plan | Graded Plan |
|---|---|---|
| Policy Type: | Whole Life Insurance | Whole Life Insurance |
| Age Availability: | 50-85 | 50-80 |
| Coverage Amounts: | $5,000-$35,000 (Max depends on age and risk) | $2,000-$15,000 |
| Death Benefit Option: | Day One Coverage | 2-Year Waiting Period |
| Contract: | Permanent | Permanent |
| Premiums: | Fixed | Fixed |
| Cash Value: | Guaranteed | Guaranteed |
| Policy Riders: | Terminal Illness Accidental Death Common Carrier Family Health | Common Carrier Family Health |
| State Availability: | All States (Except New York) | All States (Except New York) |
Foresters and its PlanRight burial insurance coverage is a provider we will often look at for full day-one coverage when working with seniors with specific medical conditions.
For example, their burial insurance plan is designed to offer two level benefit-risk classes referred to as “preferred” and “standard,” each providing full day one coverage if approved.
The preferred class is often reserved for the healthiest applicants and offers the best rates. The standard risk class is designed to provide coverage to those with specific health conditions that may often be viewed as a graded benefit by many other providers.
Foresters also offer a 2-year graded benefit reserved for those with high-risk health conditions that do not meet the standard risk class.
Along with excellent underwriting, Foresters preferred class offers some of the lowest premiums for burial insurance coverage. You will also have full access to all the available policy riders offered on the burial insurance coverage should you qualify for the preferred class.
Pros:
- An excellent option for seniors with pre-existing health conditions
- Two risk classes that offer day-one life insurance protection
- Coverage includes multiple policy riders free of cost
- Competitive rates, especially at the preferred rate class and for women applicants
Cons:
- Standard risk class can often have expensive rates
- The accidental death benefit rider is not available with the standard risk class or graded benefit plan
- All applicants will need to complete a personal health interview
The following health conditions may qualify for a level benefit policy (Preferred or Standard) with Foresters versus a graded benefit policy with a two-year waiting period.
- Aneurysms – 13+ months
- Asthma
- AFIB
- Bi-Polar
- Cancer History – 3+ years cancer free
- COPD
- Defibrillator – 3+ years
- Depression
- Diabetes
- Emphysema
- Heart Attack
- Heart Bypass
- Hepatitis B or C
- Irregular Heart Rhythm
- Kidney Renal Insufficiency
- Stroke – 24+ months
- Pacemaker – 13+ months
- Parkinson’s
- PTSD
- Schizophrenia
- Seizures
- Stent Placement – 13+ months
- Systemic Lupus
- TIA – 13+ months
*It should be noted that this is not a complete list of medical conditions. Other underwriting factors, such as prescribed medications, height and weight standards, and other underwriting factors, can affect the outcome of an approval.
To apply for Foresters senior burial insurance plans, you must work with independent organizations such as No Medical Exam Quotes.
Foresters offers both paper and electronic application processing. In addition, all applicants will be required to complete a personal health telephone interview.
Total time to complete application: 30-40 minutes
Total time to receive approval: Instant approval potential
Royal Neighbors of America
- Founded
- 1895
- Headquarters
- Rock Island, Illinois
- AM Best Rating
- A (Excellent)
| Features | Level Plan |
|---|---|
| Policy Type: | Whole Life Insurance |
| Age Availability: | 50-80 |
| Coverage Amounts: | $7,000-$30,000 |
| Death Benefit Option: | Day One Coverage |
| Contract: | Permanent |
| Premiums: | Fixed |
| Cash Value: | Guaranteed |
| Policy Riders: | Terminal Illness Nursing Home Confinement |
| State Availability: | All States (Except AL, AK, HI, LA, MA, NH and NY)) |
Royal Neighbors senior burial insurance plans are a company we will always look at when working with clients with pre-existing health conditions to try and get them first-day full coverage versus a graded benefit plan.
The insurance provider offers a generous maximum death benefit amount of $30,000 with issue ages up to age 80. Plans also come with the more common rider you will find with most final expense plans that allow early access to the death benefit due to a qualifying terminal illness or nursing home confinement.
When applying for a policy, Royal Neighbors offers multiple options to complete an application that includes a paper, online, or telephone application that can result in an instant decision for coverage.
Lastly, when you purchase a policy from Royal Neighbors, you instantly become a member of the life insurance company, making you eligible for a list of several different membership benefits, which can be very beneficial.
Pros:
- Speedy application process with the potential for instant approval
- Several pre-existing health conditions eligible for first-day full coverage
- No height and weight qualifications
- Can pay for premium directly from social security payments
- Access to membership benefits
Cons:
- Long company history but not a well-known brand
- If you’re in good health, you will find cheaper coverage with many other providers
- No graded death benefit option for applicants with riskier health that cannot qualify for first-day coverage
The following health conditions may qualify for a level benefit policy with Royal Neighbors.
- Angina – 24+ months since treatment
- Aneurysms – 24+ months since treatment
- Asthma
- AFIB
- Bi-Polar
- Bronchitis – 24+ months if chronic
- Cancer History – 24+ months
- Cardiomyopathy
- Cirrhosis – 24+ months since treatment
- COPD – 24+ months since treatment
- Defibrillator – 24+ months
- Depression
- Diabetes
- Dialysis – 24 months since treatment
- Emphysema – 24+ months since treatment
- Heart Attack – 24+ months
- Heart Bypass – 24+ months
- Hepatitis B or C – 24+ months
- Irregular Heart Rhythm
- Isosorbide Mononitrate Usage – 24+ months
- Kidney Renal Insufficiency – 24+ months
- Multiple Sclerosis
- Nitroglycerin Usage – 24+ months
- Pacemaker – 24+ months
- Parkinson’s – 24+ months
- Stroke – 24+ months
- Pacemaker – 12+ months
- Parkinson’s
- PTSD
- Schizophrenia
- Seizures – 24+ months
- Stent Placement – 24+ months
- Strokes – 12+ months
- Systemic Lupus Erythematosus – 24+ months since treatment
- TIA
- Ulcerative Colitis
*It should be noted that this is not a complete list of medical conditions. Other underwriting factors, such as prescribed medications, height and weight standards, diagnosis of multiple health conditions, and other underwriting factors, can affect approval.
To apply for a Royal Neighbors senior burial insurance plan, you must work with independent organizations such as No Medical Exam Quotes.
Royal Neighbors offers several application options, including paper, electronic, and telephone application processing.
Total time to complete application: 10-15 minutes
Total time to receive approval: Instant
Pros and Cons of Senior Burial Insurance Plans
For most seniors, the advantages of purchasing a burial insurance policy will outweigh the potential cons. The primary benefit is that owning a policy will relieve the financial burden of your family members having to come up with funeral funds when you pass away.
Advantages of Burial Insurance
Here are some of the additional advantages of choosing burial insurance for seniors:
Affordable: Burial insurance plans often cost less than traditional life insurance plans. While the low cost is partly due to the smaller coverage amounts, the insurance companies that offer these plans understand that most seniors need this type of coverage but also live on a fixed income.
Lifetime Protection: Unlike term insurance which only provides coverage for a specific timeframe, burial insurance is permanent. Once you buy a policy, your rates are locked and can never increase for the entire life of the contract.
Cash Value Growth: A burial policy accumulates guaranteed cash value growth. As the policy earns cash, you can borrow from it should financial expenses arise.
No Medical Exam: While most traditional life insurance plans require a complete medical exam (blood and urine), burial insurance plans only require you to answer health questions.
Simple Application Process: Applying for a policy is generally a simple process that is easy to follow and offered in various formats, such as online, telephone, or paper application options.
Tax-Free Death Benefit: The death benefit payout of a life insurance policy is tax-free.
Disadvantages of Burial Insurance
While burial insurance offers several benefits, there are a few potential disadvantages to consider:
Limited Age Availability: Funeral insurance type plans are not typically available for those under age 50 as they are primarily explicitly designed for the elderly.
Limited Coverage Amount: Most plans offer maximum coverage of $25,000 and may even be lower with certain providers depending on your age and health.
Two-Year Waiting Period: Applicants with certain high-risk health conditions may qualify for a plan that offers a two-year waiting period before the death benefit becomes fully payable to the beneficiary. If death happens before the end of the second policy year, the only payable benefit is a refund of all paid premiums plus interest.
Can Be Expensive: Although these plans are designed to offer an affordable solution to covering end-of-life expenses, they can be expensive. If you have pre-existing health conditions or use tobacco products, the rates for a policy can be costly and not meet your budget.
Alternatives to Burial Insurance
While a burial life insurance policy is one of the best ways to cover your funeral and other end-of-life expenses, it may not be in everyone’s budget. If the price of a burial insurance policy is not within your budget, and you’re concerned about your end-of-life expenses being a burden on your loved ones, there are a few affordable alternatives to consider.
Term Life Insurance: Term life insurance is temporary coverage offered in contract lengths of typically 10, 20, or 30 years. This type of life insurance is not designed to last forever and is priced much less than whole life insurance.
However, most term insurance plans have a starting death benefit of $100,000, likely much more than you will need to cover the funeral cost. In addition, if you are older than 65, most providers will require a medical exam.
Lastly, you need to keep in mind that if you purchase a term insurance policy in your senior years, your coverage will expire at the end of the contract, and it could be challenging to re-qualify if you have had recent health issues. While term insurance may seem like a great option due to its affordability, beware of the potential risks.
Prepaid Funeral: A prepaid funeral is when you work with a funeral home of your choice to plan out every detail of your funeral arrangements. Once everything has been planned out, a payment for the entire cost of the services is made to the funeral home upfront or, in some cases, through a scheduled payment plan.
Prepaid funerals can be a good option if you want to ensure that only your funeral arrangements are covered and not left to your loved ones to figure out. However, this option does not allow extra money to be passed to your loved ones to cover any other final expenses.
Funeral Trust: Similar to how a prepaid funeral works, the funeral home may offer a pre-need funeral trust when making payments towards funeral arrangements.
Setting up a funeral trust requires a trustor or grantor who would be the individual creating the trust, a trustee who is often the funeral home but can also be a bank or trust company that manages the trust, and the beneficiary who is typically the funeral home and who would receive the funds in the trust.
Having a funeral trust provides clear instructions on how the money you deposit into the trust will be carried out upon your death. It is a well-structured plan that ensures your funeral arrangements are carried out as you wish.
Before entering a funeral trust, it may be beneficial to consult with an elder law attorney who can review the trust and discuss the legalities and any tax requirements involved with the funeral trust.
Self Savings: If you can set a little money aside each month, opening a savings account specifically dedicated to your final expenses can be beneficial.
Some banks and credit unions may even offer a “payable-on-death account,” which allows you to save for your funeral expenses and name a beneficiary to the account who will receive the funds upon your death.
Frequently Asked Questions About Burial Insurance
Explore answers to frequently asked questions to ensure that you fully understand how burial insurance works…
How Does a Senior Burial Insurance Plan Differ from Other Types of Life Insurance?
Life insurance comes in temporary and permanent plans. Within those two forms, you have different types of life insurance options. Burial insurance is a type of whole life insurance.
While burial insurance is a form of whole life insurance, it has features that set it apart from traditional whole life insurance, beginning with the purpose of the coverage.
For example, burial insurance is often limited to a maximum benefit of $25,000, as the primary focus of the coverage is to help pay for final expenses. With a traditional plan, the minimum coverage usually starts at $100,000.
These plans are also underwritten using simplified issue underwriting. That means there are no medical exam requirements, regardless of your age. So instead of a medical exam, you only need to answer health questions. Likewise, if you apply for a guaranteed issue plan, there is no medical exam or health questions.
While traditional life insurance plans are also available with no medical exam options, that option is often limited based on your age and the amount of requested coverage. In addition, if you don’t meet the requirements for non-medical underwriting, you’re likely to be asked to complete a medical exam.
Lastly, most traditional life insurance plans have a minimum qualification age of 18, whereas burial insurance generally requires that you are at least 50 or older to be eligible. The lower benefit amounts, lenient underwriting, higher qualification ages, and overall primary purpose of the insurance coverage are why burial insurance is classified as a senior life insurance option.
Can I Own More Than One Burial Insurance Policy?
There are no rules against owning more than one burial insurance policy. However, remember that these life insurance plans offer a limited death benefit because they are designed to handle smaller end-of-life expenses. Therefore, purchasing multiple policies may not be the most cost-effective way to cover your funeral and other final expenses.
Suppose your coverage needs are more significant than final expenses, such as having an outstanding mortgage balance or children still dependent on you. Then, rather than purchasing multiple burial insurance plans, it may be better to pair your burial insurance policy with a traditional life insurance plan, such as term insurance, which can offer a greater amount of protection at a potentially cheaper cost.
Who is Eligible for Burial Insurance?
Eligibility for a policy will vary depending on the provider’s underwriting requirements. However, most of these plans generally share standard eligibility requirements starting with your age.
Most burial insurance plans often require an applicant to be at least over the age of 50 to be eligible for a policy. While you will not be required to complete a medical exam, you will have to answer health questions and provide your height and weight, which will determine your medical eligibility.
Another common eligibility requirement can include your residency. For example, some providers may not offer their life insurance plans if you live in a state where the provider is not authorized to sell. This is very common for seniors who live in New York, where insurance laws are more complex than in other states.
When considering a burial insurance policy or any other life insurance plan, it is always best to consult with an agent to learn about eligibility requirements before applying for a policy.
Can I Purchase a Burial Insurance Policy If I Have Pre-Existing Health Conditions?
A pre-existing health condition will not necessarily disqualify you from obtaining burial insurance coverage. These plans are designed for seniors, and it’s not uncommon for most seniors to have pre-existing health conditions.
For this reason, burial insurance plans offer different levels of coverage, from level benefit plans often reserved for the healthiest seniors to graded benefit plans offering a two-year waiting period for seniors with a slightly riskier health history.
Several providers offer guaranteed acceptance plans that accept everyone regardless of how riskier their past or current health condition is. However, these plans are generally reserved for applicants with high-risk pre-existing health conditions such as cancer or heart disease.
Working with an experienced life insurance agent is always a good idea, especially if you have a pre-existing health condition. They will know which providers can offer a plan best suited to your health.
How Long Does It Take to Get a Policy?
The timeframe it takes to receive approval for a burial insurance policy will vary on a few factors, such as the type of coverage (level, graded, or guaranteed acceptance), the insurance provider’s current workload, and the circumstances of the individual applying for the coverage.
Since these plans offer much more lenient underwriting than traditional life insurance plans, along with no medical exams, the average turnaround time to receive approval can often be within a few days after applying.
However, that timeframe can extend to a few weeks or months if the insurance company’s underwriter requires additional information on an applicant, such as medical records or a telephone interview.
If applying for a guaranteed acceptance plan, approval can be made immediately as there are no medical requirements or health questions.
What Should Seniors Consider When Choosing a Life Insurance Company?
Choosing a burial insurance provider can be a tough decision. While it may seem easy to pick the first company that offers the cheapest rates, that may not always be the best choice. Here are some other factors to consider when its time to pick out a burial insurance provider:
Financial Ratings: When choosing a life insurance company responsible for paying out a death claim to your loved ones after your passing, you want to ensure they are both financially stable and have a good reputation. Rating organizations such as AM Best conduct annual assessments of thousands of insurance companies financial strength and claims-paying ability to their policyholders. Based on their findings, they assign a rating indicating how strong a life insurance provider’s financial stability is.
Coverage Options: Carefully consider all your coverage options before committing to a plan. Not all life insurance companies offer the same policy features and benefits. For example, while most burial insurance plans are whole life insurance, some companies provide burial insurance as a term insurance policy. Some of these plans even have an increasing premium that can become very expensive as you age. Before committing to a plan, fully understand how the coverage works.
Underwriting: Although you will not have to complete a medical exam to qualify for a burial insurance policy, overall health plays a significant role in the type of plan you can be eligible for. Not all life insurance companies view health risks the same; therefore, choosing a company that offers favorable underwriting to you and your overall health is vital.
Customer Reviews: TrustPilot, The Better Business Bureau BBB, and Consumer Affairs are popular websites where you can read customer reviews about life insurance companies. Customer reviews can provide a lot of insight into a company’s customer service, responsiveness to claims processing, helpfulness, and overall satisfaction.
Claims Processing: The last thing you want from an insurance company with a bad reputation for handling claims processing. Make sure the company you choose offers a straightforward and fair process. Companies with a good reputation for processing their death claims quickly will often share it.
Premiums: Don’t commit to the first company you find without comparing the premiums of a few other companies. Rates can vary significantly among providers. Since this coverage will be intended to last a long time, you will want to make sure you are getting the most affordable option.
Can I Purchase a Burial Insurance Policy for my Elderly Parents?
It is common for adult children to want to purchase burial insurance coverage for their elderly parents, especially if their parents are on a fixed income and cannot afford to buy a plan on their own.
The good news is that most life insurance providers will allow family members, such as adult children, to buy life insurance for their parents. However, a few guidelines will need to be followed.
For example, your parents must consent to the life insurance coverage, and they will be required to sign the application as part of that consent.
When it comes to ownership, depending on the circumstances, most providers like to see the parent as both the insured and the owner of the life insurance policy. The payor can be the adult child or another family member.
This doesn’t mean the adult child cannot ever own their parent’s policy, but if their parent is capable of ownership, you will have to explain why the parent is not the owner as a part of showing insurable interest.
Do I Need to Notify My Family If I Purchase a Burial Insurance Policy?
There are no legal requirements stating that you must tell anyone, including your family members, that you own a life insurance policy.
However, there are benefits to letting your family and your beneficiaries know of your life insurance policy. Informing them of an existing policy can help ensure that your final wishes are carried out as you intend without delay.
As your life insurance policy is likely to be used to help pay for funeral costs, notifying your family that a policy exists can help speed up the claim process so that your loved ones can receive the funds quickly to pay for the costs associated with your death.
If you have a will, it may also be a good idea to include information about your life insurance policy and inform the executor of its existence.
How Can Seniors Avoid Being Scammed?
Unfortunately, scam artists often view seniors as easy targets, even when buying life insurance. Below are some tips to help you stay vigilant and avoid becoming the victim of a scam.
Be Cautious of Unsolicited Information: If you did not request any information on life insurance and have received mail, emails, or a telephone call from someone stating that they are from a life insurance company or other financial institution trying to sell you coverage, be cautious. However, it’s not out of the norm for actual life insurance agents to purchase lists based on age to market senior life insurance coverage.
Be Careful Giving Out Personal Information: If you’re looking for a life insurance quote, you should not have to provide personal information such as your social security number or financial details. The only information you need to provide for a quote is your birthdate, tobacco status, and in some cases, any information about your overall health. However, when you are ready to apply for a policy, you will be required to provide personal information as part of the application process for coverage.
Don’t Pay Any Upfront Fees: Life insurance providers will not charge any upfront fees before qualifying and receiving your life insurance policy. It’s not uncommon to submit payment information, such as credit card or banking information, with your application. This is often part of the application process as it provides quicker placement of your policy upon approval and acceptance of coverage. You should never be charged before accepting your policy.
Make Sure You’re Dealing with a Legitimate Company: Before you commit to purchasing a policy and giving out any of your personal information, make sure the company you are working with is legitimate. You can do this by checking the company’s financial ratings with organizations such as A.M. Best, Moody’s, and Standard & Poor’s. These ratings are often listed under “financial strength ratings,” generally in the “about us” section of the company’s website.
The National Association of Insurance Commissioners (NAIC) is another helpful website that allows you to check to see if an insurance company is legitimate. You can also view how many consumer complaints have been filed with NAIC for any life insurance provider per year, resulting in an overall customer satisfaction score. This website also allows you to verify if an agent has an active life insurance license to conduct business in your state.
Get a Second Opinion: If unsure whether you are getting the best rates or are even questioning the coverage offered, be sure you get a second opinion. You should never feel pressured into buying a policy, especially when you have doubts. Just because you started speaking to a provider or an agent doesn’t mean you cannot talk to another advisor or provider to get a second opinion.
Plus, if you accept a policy and learn afterward that you could have received a better deal elsewhere, you generally have up to 30 days to cancel your coverage to receive a full refund of your money. This is referred to as a life insurance contract’s “free look” period.
Conclusion – Is Burial Insurance for Seniors Worth It?
The bottom line is that burial insurance is worth it for those that do not want to leave their loved ones with the burden of covering funeral expenses. You can provide coverage for your burial wishes without taking away from other insurance policies or financial plans.
Burial insurance is often affordable and easy to apply for. However, it would be best if you still shopped around to find the policy with the best value and features that meet your specific needs. Compare coverage amounts, age limits, death benefit types, available policy riders, and quotes.
