- Funds that are accumulated in your super fund can be used to pay for funeral expenses.
- A term deposit or online savings account can pay for funeral costs.
- Funeral bonds that are offered by investors can pay for funeral expenses after the policy holder passes away.
- Pre-paid funeral covers can ensure that the funeral costs are paid for.
- Part of the compensation payment that is received from life insurance plans can be used to pay for funerals.
- Funeral insurance plans offered by private insurance companies can ensure that your dependants get 1 lump sum compensation payment that can be used for funeral arrangements and other expenses.
Purchasing a Stand Alone Funeral Expenses Insurance Plans
Some insurers offer stand alone funeral insurance plans that do not have to be combined with life covers, income protection insurance plans or any other type of insurance plans.
The benefit of these stand alone funeral insurance plans are that, stand alone plans are ideal for those individuals who are not eligible to get life covers and stand alone plans provide basic protection even if the policy holder doesn’t have a life cover.
Stand alone plans can be purchased online by either visiting the website of an insurance comparison company or by visiting the website of an insurer. Choosing an insurance comparison company to purchase a standalone policy can ensure that you get to compare plans before making a final decision, you get the cheapest yet most beneficial policy in your budget and you do not over pay for your policy.
Comparison websites offer a unique service that allows you to get multiple insurance quotes for different insurers for similar policies. Opting for both multiple quotes and comparison services can help you understand the terms of the selected plans and the costing of the selected plans.
Facts about Purchasing Funeral Expenses Insurance
Funeral expenses insurance plans can be purchased as add on plans with basic and comprehensive life covers. Monthly premiums for these additional plans can cost as less as having a cup of tea or coffee in a cafe.
Depending on your needs and budget, you can either opt for a standard funeral expenses insurance plan, or you can opt for a guaranteed acceptance insurance plan. Standard funeral insurance plans may require you to undergo one or more physical examinations to get a policy with the lowest premiums.
Guaranteed acceptance plans do not require you to go through physical examinations from a general practitioner; however the premiums may be slightly higher than standard plans.
Funeral covers can ensure that your dependants do not have to worry about finding funds when you pass away since the insurer that is providing the funeral cover will make the compensation payment within 24-48 hours after a claim is filed.
If any excess money is left after paying for the funeral, then your family can put that money to other important use. The insurer will not object to the money being used for other purposes provided that all the eligibility criteria are met and the policy has been paid for in full.
Failure to make payments towards premiums, failure to disclose important information to the insurer and making attempts to take one’s own life to get the compensation payments are all grounds for claims being rejected due to violation of the insurer’s terms and conditions.
Important Terms of Funeral Expenses Insurance Plans
Before agreeing to purchase an insurance plan for an extended period of time, the policy holder should make it a point to go through the Product Disclosure Statement which is an important legal document handed over to the policy holder once he purchase a policy online.
The policy holder may be given the option to cancel the policy without having to pay a penalty charge during the waiting period if he finds any unacceptable terms. Exclusions if any along with the premium payment structure and other important details will be mentioned in the PDS.
If the policy holder passes away while the policy is still active, then the family has to provide a certified copy of the death certificate along with the claim application. Detailed information regarding the claims procedure can be acquired from the insurer’s website or by contacting the insurer via the helpline number.
If the policy holder has opted for a life cover by AIA then his family may be eligible to receive an advance payment equal to 10% of the lump sum life cover benefit. This amount is usually given immediately and a maximum of $25,000 will be given to the family to cover for funeral expenses. The benefit payment will be deducted from the policy holder’s life cover benefit.