The best kind will be a policy that is in force at your passing. While you should try to get it for the best rate for which you can qualify, it is more important that your coverage is still there and has not lapsed or terminated for any reason.
While term life insurance generally has a lower premium for the same death benefit, whole life insurance is the more suitable solution for funeral expenses as the coverage will last for life as long as premiums are paid.
Many types of life insurance will work to pay a funeral. The absolute best kind if covering a funeral is your main goal is the Preneed funeral insurance that is sold by funeral homes. Those policies have several features that most insurance just doesn't have.
1. They are a limited pay policy. You will have the policy paid in full in your choice of 3 years, 5-years or 10-years or you can pay in full with one single payment.
2. They have inflation protection. The funeral policies grow each year and the death benefit is designed to keep up with the rate of inflation. Many funeral homes can give you a lifetime price guarantee because of this feature.
3. They are an exempt asset when qualifying for Medicaid or other assistance.
4. They are guaranteed issue and everyone has coverage no later than the 12th monthly payment even if you are in a nursing home, under hospice care or have a terminal illness. No other guaranteed issue life insurance can insure you as quickly.
5. You can buy them on family members with or without their knowledge. If you have a parent that never would insure themself and is going to leave a burden on you, you can take out a funeral policy on them. They do not need to sign anything or answer any health questions.
6. All funeral Preneed life insurance policies will pay the death claim within 48-hours of your death with no death certificate required.
If are on a tight budget, a funeral Preneed policy may be too expensive for you. In that case any whole-life policy will work. There are many simplified issue policies that will sell smaller amounts and offer and affordable premium. They are very easy to qualify for even if you do not have perfect health.
Whole life insurance is the best for funeral expenses. There are many Whole Life policies that can now be purchased with no medical exam for small face amounts that work perfectly for a funeral. The death benefit is left to your beneficiary, so, e.g. if you changed your mind from being embalmed to being cremated, the extra money can go to your other bills. When you buy permanent insurance, you don't have to worry if it will be in effect at your death.
That is a great question! There are a ton of modestly priced whole life policies that are lower face values designed to cover your funeral expenses. Often marketed as "burial insurance", they are typically anywhere from $5-35,000 face values, and are very simply issued. There are usually some questions on the application, or a phone interview with prescription and medical history checks. They are perfect for folks who want to care for their family, but may not have a ton of money to do it. If you would like to know my preferred companies for this, please contact me. Thank you for asking!
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While term life insurance generally has a lower premium for the same death benefit, whole life insurance is the more suitable solution for funeral expenses as the coverage will last for life as long as premiums are paid.
1. They are a limited pay policy. You will have the policy paid in full in your choice of 3 years, 5-years or 10-years or you can pay in full with one single payment.
2. They have inflation protection. The funeral policies grow each year and the death benefit is designed to keep up with the rate of inflation. Many funeral homes can give you a lifetime price guarantee because of this feature.
3. They are an exempt asset when qualifying for Medicaid or other assistance.
4. They are guaranteed issue and everyone has coverage no later than the 12th monthly payment even if you are in a nursing home, under hospice care or have a terminal illness. No other guaranteed issue life insurance can insure you as quickly.
5. You can buy them on family members with or without their knowledge. If you have a parent that never would insure themself and is going to leave a burden on you, you can take out a funeral policy on them. They do not need to sign anything or answer any health questions.
6. All funeral Preneed life insurance policies will pay the death claim within 48-hours of your death with no death certificate required.
If are on a tight budget, a funeral Preneed policy may be too expensive for you. In that case any whole-life policy will work. There are many simplified issue policies that will sell smaller amounts and offer and affordable premium. They are very easy to qualify for even if you do not have perfect health.