Buying Burial Insurance for Your Parents

Are you looking for burial insurance for your parents? You have come to the right place! In this article, we will review the common questions related to purchasing a burial policy for your parents, and some key insights into the process.

Is burial insurance cheaper than life insurance?

Burial insurance is actually a small whole life insurance policy with no medical exam. So, it is not any cheaper than life insurance–it is life insurance. Upon the death of your loved one, you file a death claim with the insurance company, and they provide you with the death benefit. You can choose to use these funds towards the burial expenses, cremation, funeral, paying off debt, etc…..you are not limited to just using them for burial costs.

Are there different types of burial insurance?

Yes, there are 4 different types of burial insurance plans. Based on the health status of your parents, they will either qualify for level, graded, modified, and guaranteed issue. Here is the breakdown of the 4 plans:

Level Coverage

Many individuals can qualify for level coverage, or day one coverage, even if they have pre-existing conditions. This plan is obviously the gold standard, since you want your loved ones to have coverage from the start. The insured, your parents, will have to answer a series of yes or no health questions, and have a prescription history check (performed by the insurance company). In most cases, the plan can be approved the same day!

Graded Coverage

A graded benefit plan is not ideal, but it is better than the latter. With a graded plan, your parents will have partial coverage for the first 2 years of the policy. Typical amounts average between 25%-40% of the death benefit for the first year, and 50%-75% of the death benefit in year 2. After year 2, they would be eligible to receive the entire death benefit.

Modified Coverage

If your parents answer yes to certain health questions, they may only end up qualifying for a modified coverage plan. This happens when there was a recent serious health event, such as a stroke, heart attack, or cancer. Modified plans offer a return of premium for the first 2 years of coverage, plus interest (usually around 5-10%). So it’s as if you were placing those funds into a high paying interest bearing account, which we all know are a thing of the past.

Guaranteed Issue

Just like the title reads, a guaranteed issue plan, is a burial insurance policy in which no medical or lifestyle questions are asked. This type of policy is best for parents that have had recent serious medical issues. They would not qualify for any other type of plan. This is also a graded death benefit plan, where if death were to occur in the first 2 years of having the policy, a return of premiums paid plus interest would happen, and then at year 3, the full face amount would be paid out.

Can I buy a burial insurance plan for my parents without their consent?

The answer to that question is NO. You must have the consent of the insured (your parents) in order to purchase a policy for them. As the insured, your parents will have to either e-sign or voice sign the application, even if they are not going to be the one’s paying for the policy.

The reason children and grandchildren like to purchase plans for their parents is so that they are not stuck with paying the high bill from the funeral home when the time comes. In 2023, the average cost of a funeral, according to National Funeral Directors Association (NFDA) was $9,995. And with inflation on the rise, you know that number is only going to increase.

As a child of the parent, you would have insureable interest, since you would ultimately be the one left behind to take care of the expenses. In most cases, we would set you up as the owner and the beneficiary of the policy. This way there should be no troubles at tax time.

How do I apply for burial coverage on my parent?

The first thing that you will want to do is gather some basic information from your parents. You will want to know their date of birth, height and weight, a list of their current medications and dosages they are taking, as well as a list of any health issues they have, and the date of onset if possible. This will be extremely helpful in the prequalification process, where our agents match them with the company that fits their unique health profile and budget. Once a company has been isolated to apply with, your parent will need to be present with you, in order to start the application. The agent will ask them the application questions, and they will either need to e-sign, security question sign (i.e., mothers maiden name), or voice sign (complete a mini interview with the insurance company). Policies are issued the same day in most instances.

To get the application process started, simply fill out the form on the right. This secure form is sent only to Burial Insurance Today. You will NOT be spammed called by multiple agents. After completing the form, you will instantly see a true sampling of quotes based on your inputs. Corey Schuler, owner of Burial Insurance Today, will personally contact you to review your options. With over 20 years of industry experience, she cares passionately about helping seniors find the coverage they desire to fit their budget.