Three other ways to meet the costs

1 FUNERAL INSURANCE

KNOWN as over-50s plans, you pay a low monthly sum and receive a payout to cover costs such as funeral plans after you die. But these deals can be poor value if customers end up paying in more than they ever get out of it. If a customer stops paying, the plan is no longer in force and money already paid has been wasted.

2 SAVINGS AND INVESTMENTS

RATHER than gamble with a poor plan riddled with exclusions, it makes sense to put aside money each month into ordinary savings and investments. The money can be used to cover funeral costs if needed by your family in future. Yet there are no guarantees of you saving enough or refraining from using the funds for something else. Furthermore, relatives would still need to pay upfront funeral costs and would only be repaid if they are benefactors when your estate is divided up.

3 WHOLE OF LIFE INSURANCE

THIS type of life insurance pays out a lump sum to relatives after you die. Other life insurance policies last only for a set term, such as the life of a mortgage or until children are grown up and independent. A whole of life policy pays out whenever you die – but may require you to pay monthly sums for the rest of your life. Some policies allow you to cease paying when you reach a certain age. These policies can also be linked to investments.