Out of say­ing farewell

Deal­ing with the loss of a loved one is al­ways painful, but un­planned fu­neral ar­range­ments can make the ex­pe­ri­ence even harder. Know­ing how to choose a fu­neral pol­icy that suits your needs is the best way to en­sure that the process is as sim­ple and has­sle

CityPress - - Voices -

Most fu­ner­als in South Africa are lav­ish cel­e­bra­tions that are held to hon­our the per­son who has passed away. Although these events are gen­er­ally worth the money be­cause they al­low ev­ery­one to pay their re­spects, they can get ex­pen­sive.

The cost of a fu­neral can be as much as sev­eral months’ salary for the fam­ily. It de­pends on the type of fu­neral and re­quire­ments that the de­ceased had spec­i­fied for in their last will and tes­ta­ment.

Re­li­gious cer­e­monies, food and out­fits are all ex­penses that can add up, es­pe­cially when hun­dreds of peo­ple are in­volved.

For a ba­sic fu­neral with a cre­ma­tion ser­vice, the cost is likely to be R7 500, while an av­er­age fu­neral will prob­a­bly cost R12 500.

More ex­pen­sive fu­ner­als are nor­mally the re­sult of the de­ceased choos­ing a be­spoke cof­fin de­sign. Some high-end coffins and cas­kets alone can cost be­tween R24 000 and R50 000, which can in­crease the cost of the fu­neral to be­tween R40 000 and R70 000.

Given the high costs in­curred when pay­ing for a fu­neral these days, it is lit­tle won­der that fu­neral poli­cies are be­com­ing more com­mon.

A fu­neral pol­icy eases fi­nan­cial worry, and al­lows you and your fam­ily to spend more time mak­ing ar­range­ment and pro­vid­ing each other with


emo­tional sup­port, in­stead of wor­ry­ing about money.

Cita Penn, head of client so­lu­tions at San­lam De­vel­op­ing Mar­kets, says: “If all the rel­e­vant doc­u­men­ta­tion is in or­der, a fu­neral pol­icy pays out quickly and you won’t have to worry about find­ing the money.

“In ad­di­tion to that, fu­neral poli­cies gen­er­ally in­clude ben­e­fits that will make things eas­ier for you. It eases the bur­den through a dif­fi­cult time.”

There are many ways that you can pro­vide for your fu­neral, in­clud­ing sav­ing your money to build up an emer­gency fund, tak­ing out a life pol­icy, or buy­ing a fu­neral pol­icy or fu­neral plan.

If you have a life pol­icy or your em­ployer pro­vides you with group life cover, the pol­icy may of­fer a fu­neral ben­e­fit, which usu­ally pays out within 48 hours of your death.

You may not be un­der­writ­ten, which means your pre­mi­ums will not be de­ter­mined by the risk that you pose to the in­surer.

A fu­neral pol­icy, in which a cash ben­e­fit is paid out to your ben­e­fi­cia­ries, is usu­ally bought from life as­sur­ers or fu­neral par­lours, and lim­ited, or no, un­der­writ­ing ap­plies. A six-month wait­ing pe­riod usu­ally ap­plies.

A fu­neral plan, where no, or lim­ited, un­der­writ­ing ap­plies, can be bought from a fu­neral par­lour and burial so­ci­ety or short-term in­surer. The plan cov­ers you and some­times mem­bers of

Gre­gory Rule

your im­me­di­ate or ex­tended fam­ily.

The dif­fer­ent types of fu­neral poli­cies all have vary­ing de­grees of cover and costs. The ma­jor ben­e­fit of tra­di­tional fu­neral poli­cies is that the in­surer pays out a lump sum on an agreed turn­around time.

This is usu­ally 24 to 48 hours af­ter all rel­e­vant doc­u­men­ta­tion has been re­ceived.

Be­fore mak­ing a de­ci­sion to pur­chase fu­neral cover, it is im­por­tant to first as­sess your needs and those of your fam­ily, both now and in the fu­ture.

Think about how many peo­ple there are in your fam­ily, whether you would be re­spon­si­ble for their fu­neral and con­sider how much you can pay to­wards a fu­neral plan – with­out cut­ting back too much on spend­ing on other parts of your life.

You then need to con­sider how much you will need to pay for the fu­neral and pay each month for the pol­icy.

Once you have an idea of how much you can spend on a pol­icy, you should speak to a fi­nan­cial ad­viser from a trusted in­surance provider.

“At the end of the day, the most im­por­tant thing is to choose the right fu­neral pol­icy for you and your fam­ily,” Penn says.

“It should cover your needs and suit your pocket. Do some re­search and speak to your fi­nan­cial ad­viser about the best pos­si­ble so­lu­tion for you.”

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