If you have been noticing signs of rapid aging in your parents, it may be advisable to look for burial insurance coverage. It will help you plan their funeral as per their wishes without added financial stress. Insurance expert Gary P. Cubeta of Insurance for Final Expense agrees that searching for burial insurance for parents might be one of the most emotionally daunting tasks you’ll ever undertake.
Often, children opt for burial insurance for their elder parents. Burial insurance is a “small-coverage” life insurance policy that covers funeral costs and other final expenses. Seniors can apply for the policy themselves, or children of seniors can apply for the policy. The coverage for these policies typically ranges anywhere between $5,000 and $50,000.
How Burial Insurance Works
Seniors or their children can approach an insurance provider for the burial insurance policy. Applicants may be required to submit a physical application form or an online application form. You can choose a policy based on your coverage needs and your budget. There are two conditions to be fulfilled when choosing burial insurance for your parents.
Insurable Interest
Insurance companies will demand proof of insurable interest when you purchase burial insurance for your parents. Insurable interest means proof that you will sustain a financial loss if your parents pass away. When a parent passes away, the burden of their funeral expenses automatically falls on the children. This is adequate reason and proof of insurable interest. All you need to do is submit an ID proof that shows the insured’s name as your father or mother.
Consent to Review Medical History
As per HIPAA laws in the United States, you do not have permission to review your parents’ protected medical information. This means you need your parent’s consent to let the insurance company review their health. Insurance companies do not insist on strict physical tests or detailed medical checkups for burial insurance. The company will ask questions relating to health in the application, through a phone call, or in person.
Even if your parent has a terminal medical condition, he/she is still eligible for burial insurance. The insurance company collects your parents’ health-related information to decide which plan would suit them best and decide the policy’s cost. If your parent has a severe illness that could lead to their death shortly, the company may charge a higher premium.
Average Cost of Burial Insurance for Parents
According to Gary P. Cubeta of Insurance for Final Expense, the cost of burial insurance for parents would depend on four things: coverage needs, health condition, age, and gender. Data shows that burial insurance for female applicants is lower than that of male applicants.
Tobacco users and applicants with a history of alcoholism may be charged higher premiums. The younger your parent is, the lower will be the cost of the policy. Seniors who are over 70 could end up paying a premium of up to $600. The cost of burial insurance for a parent who is less than 60 years may be as low as $250.
Burial Insurance for Parents Who Are 80 or Older
You can get burial insurance for your parents even if they are 80 or older. Burial insurance usually has no waiting period and no conditions. Applications are generally not rejected based on health conditions.
Why Opt for Burial Insurance for Your Parents
Studies show that over 70% of Americans are concerned that they don’t have enough retirement savings. Data also shows that around 21% of Americans have no retirement savings. Further, the average cost of funerals in the United States is around $8000.
If you don’t provide for your parent’s funeral expenses, you may end up with a substantial financial strain when they pass away. Burial insurance also covers other final expenses like medical expenses and legal expenses. Making adequate provisions for the same will ease the stress of organizing funerals in the event of a parent’s death.
Burial insurance will also cover miscellaneous costs like the transportation of close family members attending the funeral. The health condition of your parents is the most important consideration for getting burial insurance. If you have reason to believe your parents may pass away shortly, it may be best to opt for insurance.
It would be wise to start a burial insurance policy even when your parents are reasonably young and in good health. The average cost would be much lower, and you don’t have to worry about any unforeseen emergencies.
Bottom Line
We can be sure that choosing burial insurance five years later will not be cheaper than choosing it now. When choosing burial insurance for your parents, ensure you choose a suitable plan from a reputed insurer. You may want to work with an insurance agent or expert to ensure you get the best policy for your parents after considering their health conditions and age.
