Parents' Funeral Insurance
Looking to buy funeral insurance for your parents to help with their funeral costs? Compare policy options with Savvy.
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None of us likes talking to our parents about difficult subjects, with death and funerals being right up there as the hardest conversations for loved ones to have. However, broaching these delicate subjects is vital if you or your parents are considering funeral insurance, or other options for covering the cost of a service to say farewell.
Some life insurance policies and many superannuation policies offer some form of coverage for funerals. Here at Savvy, we don’t compare standalone funeral insurance, but we do offer a free comparison service to compare life insurance policies side-by-side. Find out what you need to know about funeral insurance for your parents, and what other options may be available to help pay for the cost of a funeral here with Savvy.
Is it possible to get funeral insurance for my parents?
Yes, it is possible to buy funeral insurance on behalf of your parents, and it can provide valuable financial support during a very challenging time should they pass away. Here’s a few things you should know if you are considering assisting your parents with funeral cover:
Ownership and consent
When purchasing funeral insurance for your parents, you become the policy owner, even though you are not the insured person. This means that you have control over the policy, including paying the premiums and making a claim. However, it's crucial to obtain the consent of the parent you wish to insure. They should be made aware that a policy has been taken out on their behalf, as they will be formally notified by the insurance provider.
Coverage
Funeral insurance typically covers funeral-related expenses, such as burial or cremation costs, celebrant fees, transportation, and flower arrangements. You can choose the coverage amount from a minimum of $3,000 up to a maximum of $15,000 (or sometimes more with some insurers, who may allow cover up to $24,000).
Funeral insurance offers peace of mind, ensuring that the financial burden of funeral expenses does not create additional distress during a time of bereavement. It allows you to provide a dignified farewell for your parents without added financial stress.
Before purchasing funeral insurance for your parents, carefully review the policy terms, premiums, and any waiting periods or exclusions to ensure the policy meets your specific needs and circumstances.
What additional benefits are available with funeral insurance?
Funeral insurance can offer several additional benefits beyond covering funeral expenses. These may include:
- Accidental death cover: Some policies provide immediate coverage for accidental deaths, even during the initial 12-month waiting period.
- Terminal illness benefit: In the event of a terminal illness diagnosis, you may receive an early payout to cover medical expenses or final wishes.
- Accidental injury cover: Some policies extend coverage to accidental injuries, offering additional financial protection.
- Guaranteed acceptance: Most funeral insurance plans have guaranteed acceptance, meaning you can get coverage regardless of your parents’ health or age. They will not need to have a medical and as long as they are aged between 40 and 80, the application for funeral insurance will be accepted.
- Premium discounts: Some insurers may offer discounts for paying premiums annually or in advance, which offer the possibility of cheaper funeral insurance for you parents.
- Family discounts: If multiple family members buy policies from the same provider, they may qualify for substantial discounts. Family funeral policies are also available, offering cover for multiple family members under the one policy.
- Premium freezes: Some policies offer the option to freeze premiums at a certain age, ensuring you don't face rising costs as your parents get older.
- Early cash in options: Certain policies may offer the flexibility to cash in the policy after the insured reaches a certain age, typically over 80 years old.
These additional benefits vary between insurance providers and policy options, so it's essential to carefully compare funeral insurance plans and review the terms and conditions to understand the full range of benefits on offer.
Before purchasing any sort of insurance policy, whether that be funeral insurance or a more comprehensive life insurance policy, it's always important to review any existing insurance policies (and superannuation account) and find out what cover, if any, your parents may already have in place for the cost of a funeral. It is common for funeral cover to be included in many life insurance and superannuation policies.
Questions you may want to ask your parents about the type of funeral they would like:
Since you will need to talk to your parents about this difficult subject if you’re contemplating taking out funeral insurance, here’s a few conversation-starters to help you find out what they really want:
- Burial or cremation: Do they have a preference between burial and cremation?
- Location: Is there a specific cemetery or crematorium they have in mind?
- Religious or non-religious: Would they like a religious ceremony, a secular service, or something in between?
- Funeral service venue: Do they have a preferred location for the funeral service, such as a church, funeral home, or another venue?
- Officiant: Is there a specific person they'd like to officiate the service, like a religious leader or a celebrant?
- Music and readings: Are there songs, hymns, or readings that hold special meaning for them that they'd like to include?
- Flowers and decor: Are there specific flowers or decorations they'd like at the service?
- Memorialisation: Would they like a headstone, plaque, or another form of memorial at the gravesite or crematorium?
- Donations: Are there charities or causes they'd like donations to be made to in lieu of flowers?
- Other personal wishes: Are there any personal touches or unique requests they'd like to share, such as dress code, themes, or specific people they'd like to be invited?
How much will I need for my parents’ funerals, and what are the costs?
On average, a funeral in Australia can range from a minimum of around $5,000 to over $15,000. Cremation tends to be cheaper, with basic services starting at $3,000 upwards. Some of the costs involved in organising a funeral are:
- Funeral notification: Placing a death notice in a local newspaper is can cost between $200 to $300.
- Transport: Covering hearse hire and transportation costs, this can range from $500 to $1,500.
- Funeral service: This includes various elements such as the legal documentation, venue hire, catering and flowers. It typically ranges from $3,000 to $5,000 or more.
- Burial and headstone: Finding the right burial plot can be expensive, with costs for the most popular locations starting at $5,000. Headstones, even the smallest and cheapest, can cost over $1,000.
- Coffin or casket: Often a significant cost, ranging from $1,000 to $10,000.
- Cremation: Generally cheaper than burial, cremation costs are typically around $1,500 – $3,000.
- Cremation service: Often less expensive than burials, these services typically range from $1,500 to $3,000+.
- Urn: Urns can range from $50 to $500.
These costs can vary significantly depending on location, preferences, and other factors. Planning ahead can help alleviate the financial burden associated with these expenses.
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