Business Connection

Financing funerals


According to Lincoln Heritage Funeral Advantage, the average funeral costs between $7,000 and $10,000. It can be easy to overlook planning for such a large expense, and many people may think their funeral costs will be covered by their life insurance policies. However, that isn’t always the case and certain complicati­ons can arise. The funeral planning informatio­n guide Funeral Basics states that sometimes insurance policies become invalid if payments have not been made. Policies may have liens on them, or some named beneficiar­ies may no longer be alive. This can stall the process as issues are worked through. In addition, it can sometimes take between six and eight weeks for beneficiar­ies to receive life insurance policy payouts. Since many funerals take place within a week of a person’s death, it’s unlikely that surviving family members will be able to finance funerals with life insurance payouts. In addition, some policies may not be assignable, which means the ben

efits cannot be assigned to go to a third party who will file the claim for you (i.e., the funeral home or an assignment company with which the funeral home partners). It’s important to determine if an existing policy is assignable and to take appropriat­e measures if it is not. Individual­s may want to consider burial insurance or preneed funeral insurance. Another option is to use preplannin­g services, which allow people to prepay for funeral expenses and make planning decisions regarding the services and burial so that family members will not be tasked with financing and/ or planning a funeral during a difficult time in their lives.

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