Many people believe that in the hour of need they will cash their superannuation fund or a life insurance policy, but the truth is that these claims take a few weeks at least to be processed. Thus, if your family can arrange an average amount of $4,000 to $15,000 at the time of the funeral of your family member then it is fine, but not everyone has that kind of money available when they really need it. That’s why it’s better to prepare for such times by buying a funeral insurance policy. But you need to know that you’re buying the right product.
Here are a few things that you need to be careful about when buying a funeral insurance policy.
1- The Higher the Risk, the Higher the Cost
Make sure that the insurer from whom you’re buying a funeral insurance policy does not sell policies to elderly people only. This is because funeral insurance works on the same principle as life insurance, i.e. the higher the age of the insured person, the greater will be the risk. Thus, funeral insurance policies for elderly people mean higher premiums are to be given to the insurance company.
2- Calculate All Your Final Expenses
This is the most important thing to do before you buy a funeral insurance policy. Doing so makes you able to select the ideal funeral insurance policy. Calculating all your final expenses mean that you should add the cost of everything that you want at your funeral. This would also include all the expenses pertaining to transportation, flowers, refreshments and the memorial service of course. Once you’re done assessing the cost of your funeral, see if the policy you’re interested in can cater your last wishes or not. The one that does, that one is the right policy for you.
3- Check How Fast Will the Payout Be
The sole purpose of funeral insurance is to provide money to the grieving family so that they can take care of the funeral arrangements of the deceased family member. Thus, the first thing you must check in a funeral insurance policy before you buy it is that how fast and quick will the payout be. How soon will your family receive the money after you die? In most of the cases the mentioned time period is two days. For further details regarding the payout, you can contact Freedom Insurance.
4- Comparison of Funeral Plans
This is a must. Just like you survey before buying anything for yourself in the market, it’s imperative that you do the same when you’re buying a funeral insurance policy. Don’t forget to compare the funeral covers of several insurance companies so that you know which insurer is offering you what in terms of entry and expiry age and the level of cover.
There are other things which you can add to this checklist, like taking quotes from several companies so that you know which insurer is taking premiums that are adjustable to inflation. You also need to check if the policy is for short term or long term affordability.