Two Types of Burial Insurance | Senior Life Services (2024)

FAQs

Two Types of Burial Insurance | Senior Life Services? ›

There are two types of burial insurance: simplified issue or guaranteed issue. This makes it possible for seniors to acquire life insurance at an older age and even when they have some health problems.

For the most part, there are two types of life insurance plans - either term or permanent plans or some combination of the two. Life insurers offer various forms of term plans and traditional life policies as well as "interest sensitive" products which have become more prevalent since the 1980's .

There are two major types of life insurance: permanent (whole) and temporary (term).

Final Expense Insurance - California families who are specifically concerned about funeral costs should consider final expense insurance. This is a type of whole life insurance designed to cover funeral expenses.

Types of Burials

This section is designed to guide you through the five main memorialization and burial types available - including below ground, above ground, and cremation.

Insurance companies are classified as either stock or mutual depending on the ownership structure of the organization. There are also some exceptions, such as Blue Cross/Blue Shield and fraternal groups which have yet a different structure.

Term insurance offers temporary protection for a specified period, and the death benefit is paid if the insured passes away within that term. However, if the insured survives the term, the coverage ends. Permanent cash value insurance offers lifetime protection as long as the policy remains active.

Can you have two types of insurance? ›

Having dual coverage is perfectly legal—you just need to coordinate your two benefits correctly to ensure your medical expenses are covered compliantly. If you're new to dual insurance, you've come to the right place!

Primary and contingent beneficiaries

The person you want to receive the payout from your policy—your first choice—is called the “primary beneficiary.” If that person is your only beneficiary, you will also want to designate a secondary beneficiary (also known as a “contingent” beneficiary).

The two main components that make up a life insurance policy are the death benefit and the cash value. The death benefit is the part of the plan that the beneficiaries receive later on. You can predetermine what you would like this face value to be upfront.

Burial insurance, also called final expense or funeral insurance, is a whole life policy that helps cover the costs of an individual's final arrangements. It pays for expenses such as the memorial service, casket or urn, and burial or cremation.

Does life insurance cover burial costs? Yes, life insurance policies will pay a lump sum when you die to a beneficiary of your choice. That money can be used to pay for your funeral or for any other general financial needs of your survivors.

You can assign any beneficiary you want, and they can use the payout for your funeral expenses, medical bills, final utility payments, and other outstanding bills. And if there is money left over, your beneficiary can do with it as they please.

The average cost for a burial insurance policy is approximately $50-$100 monthly for roughly $10,000 in coverage. Multiple factors determine the net price, including your exact age, health, tobacco usage (if any), the type of policy, state of residence, and how much coverage you buy.

Purchasing a burial insurance policy (or a small life insurance policy designed to cover final expenses) can help prevent the passing of any substantial debt to surviving family members. In addition, a more robust whole or term life insurance policy can help you provide financial support to aging parents or siblings.

Unlike traditional term, whole life, and universal life policies, burial insurance is specifically designed to cover one-time and short-term expenses. It isn't meant to replace income or cover large expenses like purchasing a home or paying for college. It isn't a type of retirement plan or investment either.