Comparing burial insurance can be very confusing, and a lot of people have questions about the different types of policies. Maybe they’ve seen a commercial on TV or maybe they heard a radio advertisement. The main question seems to be, are all burial insurance policies the same? I would have to say no. There are a lot of differences in the various companies and how they write the policies. There can also be differences in the terms and conditions of these policies. So, when searching for the right burial insurance policy, there are always three main points that I tell people to pay attention.
The first thing I tell people, is to ask whether or not the policy has a waiting period? A lot of the popular companies out there may not require any health questions to be answered, nor do they require a paramedical exam. Most often, however, they automatically place a two to three year waiting period on the policy. This means, should the person pass away during this two to three year period of time, the policy would simply return the monthly premiums that have been paid plus interest. They would not actually pay out the full face amount of the policy. This is not the case with all companies though. Some will eliminate the waiting period completely if you’re able to pass a short health questionnaire.
The other question to ask when comparing companies would be, is the monthly payment fixed for the life of the policy? A lot of companies offer great entry level rates. They seem affordable but sometimes the monthly premium will rise as you keep the policy. This can happen every 12 months, or every 5 years depending on how the policy is set up. In my opinion, these aren’t the best policies to have because as one gets older typically income gets tighter. The rising premium could cause someone to need to cancel the policy because they can no longer afford it. At that point, it might be difficult for them to replace the policy because their age or health might prohibit them.
Lastly, it’s important to ask if the policy has a cut-off point. A lot of companies that offer burial insurance will only offer a policy that’s good until age 75, or 80; 80 being the most popular that we see. This means that the policy is only good until your 80th birthday. At that point the policy is null in void and cancels. It is typically not renewable at that time either. That’s a big problem, because the average life expectancy for male or female at this point is over the age of 80. So at a point when the average individual would need the policy, the policy no longer exists. At this stage in life it will also be difficult to replace the lost policy, because age or health may prohibit you from purchasing a new one.
So to answer the question, I would say that not all burial insurance policies are the same. It’s very important to shop around, and make sure you fully understand the differences. I would also recommend speaking to an agent if you have access to one. You’re more than welcome to call us directly as we are an agency specializing in burial insurance as well as other types of life insurance for seniors. Our direct number here at the office is 866-699-1884. We have licensed representatives in most states and would be glad to help should you have questions. We represent many A rated companies that do NOT increase rates nor do they terminate at age 80. Typically the companies we use will cover seniors until age 105 or older. So unless they’ve found a hidden fountain of youth it is unlikely that insured loved one will outlive the policy.