Unfortunately, we can’t keep our loved ones safe from the loss and grief of our passing away. But one thing we can certainly do for them is to minimize their financial burden by providing them with financial security. For that, what else is better than cremation insurance?
You can effectively make your financial arrangements for end-of-life expenses via cremation plans. This plan offers you a great way to cover your final expenses and to reduce the load of responsibility on the family members surviving after your sudden death. However, getting the right cremation insurance plan is very important.
In this blog post, we will explore what a cremation plan exactly is, how much it costs, and many other aspects to make things clearer for you. Let’s get started!
What is Cremation Insurance Policy?
Cremation insurance is a particular type of whole-term life insurance that is designed to cover the cost of cremation. The payout or death benefit of this plan is used for final expenses. It is also known as a final expense or end-of-life insurance.
A cremation plan is more convenient to purchase as compared to many other types of Life Insurance Policy. As it does not require any medical exam if the applicant is in poor health, he will still get the plan. You can easily get this plan via an insurance company or a funeral home provider.
While getting the plan, you have to choose the coverage level you want and pay monthly amounts (premiums) into the policy. The total lump sum of that money will be paid directly to the designated beneficiaries as tax-free cash in case of your sudden death.
How does cremation insurance work?
A cremation insurance policy, a form of simplified Whole life insurance, works just like many other insurance plans. Insured pay a small amount of protection that accrues cash value each year. In case of death, the payout is given to the beneficiaries of the policy.
Moreover, getting a cremation insurance plan is very easy. You just have to determine the cremation insurance cost and other related expenses which will be used as the outline for your policy. Meanwhile, you can assist a funeral director to help you with getting an idea about funerals and other related expenses.
In terms of qualification, a cremation insurance policy is for everyone. As there is no medical exam, coverage doesn’t reduce in value, premiums don’t rise, and your policies remain in force until death. Furthermore, the death benefit it’s offered is immediate so your loved ones get the money when they need it most to cover your funeral expenses.
What types of cremation plans are there?
Here we will discuss the two most common types of cremation insurance:
1- Direct Cremation
If you are looking for the most cost-effective option in a cremation plan, look no other than direct cremation. It provides you with basic cremation services that cost you only a few hundred dollars. The services it offers include transfer, cremation, and interment of the body. However, if you opt for cremations with viewing options it may cost you slightly high.
2- Traditional Funeral
Another option for a cremation plan comes with a traditional funeral service. According to an estimate, it may cost you around $6,000 to $9,000. However, it’s one of the most complex and expensive options as it has moving parts. So before purchasing this plan, you should consider everything from embalming and preparing the body to the hearse to the containers for ashes and other transportation involved.
Does age affect cremation insurance costs?
Here we will provide you with a sample quote for a $5,000 cremation plan. This sample will highlight how age impacts the cremation plan cost:
A 50-year-old woman can expect to pay around $14 a month. However, the monthly premium for the same policy could be about $18 for 60 and $28 for 70-year-olds. On the other hand, males have to pay a few dollars more for the same coverage as according to research men die younger than women.
How to find the best cremation insurance policy?
If you have decided to go with a cremation plan before buying you have to do some research to get the best possible policy. Below are some of the factors you have to consider while finding the best cremation insurance.
- Outstanding Debts: Some additional funds can also be added to the policy to cover your remaining debts like a mortgage.
- Time off Work for Family Members: If your beneficiaries or other family members have to take leave at your demise, the insurance plan will help them to afford their time off.
- Travel Expenses: You can also add some extra funds to cover the traveling costs of attendees from air travel to their hotel stays.
- Income Replacement: If you are the only earning source of your family, the surviving ones behind you have to suffer the loss of income. So consider supplementing your plan with additional coverage for income replacement.
Along with all these factors, it’s also necessary to account for inflation. The price of everything including funeral costs increases with time. So make sure your plan will cover you sufficiently if you buy it years before your death.
Is a cremation plan necessary to buy?
No, as the cremation plan is not required or demanded by any state or federal laws. You may also not need to get cremation services, no matter if you are planning ahead or maybe arranging an on-the-spot service for a loved one. However, it’s just a simple and budget-friendly tool that helps you effectively cover your end-of-life expenses.
That’s all about the cremation insurance policy. Hope this blog post helps you to get a better understanding of aspects related to cremation plans. Moreover, cremation insurance for seniors and AARP cremation insurance plans are also available nowadays in case you want protection coverage for your elder parents or any other older member of your family.
Frequently Asked Questions (FAQ)
1- Does life insurance cover cremation?
Yes, based on the policy terms and its setup, most life insurance plans cover the funeral cost. To make sure for the funds to be available for your family when they need them, it is crucial to plan things and set up them in advance.
2- Does Medicare cover cremation?
No Medicare does not pay directly for cremation costs as these are not involved in health care costs. However, Medicare is a health insurance that helps you to cover healthcare costs when you are above 65 or may have some specific disabilities.
3- Can I buy cremation insurance?
Yes because cremation insurance plans pay the lump sum amount much faster than other types of life insurance plans. This feature makes it an ideal solution to cover the final arrangement instantly.