Burial insurance: What is it & how does it work?

Burial insurance, or final expense life insurance, is a type of permanent life insurance designed to cover your funeral and burial costs.

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Amanda Shih

Amanda Shih

Editor & Licensed Life Insurance Expert

Amanda Shih is a licensed life, disability, and health insurance expert and a former editor at Policygenius, where she covered life insurance and disability insurance. Her expertise has appeared in Slate, Lifehacker, Little Spoon, and J.D. Power.

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Nupur Gambhir

Senior Editor & Licensed Life Insurance Expert

Nupur Gambhir is a licensed life, health, and disability insurance expert and a former senior editor at Policygenius. Her insurance expertise has been featured in Bloomberg News, Forbes Advisor, CNET, Fortune, Slate, Real Simple, Lifehacker, The Financial Gym, and the end-of-life planning service Cake.

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Maria Filindras

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Burial insurance, also known as final expense insurance, is a type of life insurance designed to pay a small death benefit to your family to help cover end-of-life expenses. Unlike traditional life insurance, which is meant to replace decades’ worth of income, burial insurance is usually suited to older adults who want a smaller policy to cover their funeral costs.

Because of its high rates and lower coverage amounts, burial insurance is usually not as good a value as term life insurance. So it’s best for people who have trouble qualifying for traditional coverage, like seniors and people with serious health conditions.

Key Takeaways

  • Burial insurance policies usually offer low coverage amounts, up to $50,000.

  • Term life insurance offers much more coverage at a lower cost.

  • If your age or health disqualifies you from getting traditional term coverage, a burial policy is a good option.

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What is burial insurance?

Burial insurance is a type of permanent life insurance intended to cover funeral expenses. The death benefit is usually used to pay for medical bills, burial or cremation services, and caskets or urns.

Like other permanent life insurance, burial insurance coverage stays active as long as you pay your premiums. But unlike most traditional permanent life insurance policies, which require a medical exam to apply, you only need to answer a few questions to qualify for final expense insurance. There’s little to no waiting period to get covered.

Types of burial insurance

There are two types of burial insurance: simplified issue life insurance and guaranteed issue life insurance. They vary slightly in maximum coverage amounts, age restrictions, pricing, and the medical information required to apply.

Simplified issue life insurance: For individuals with moderate health issues

Simplified issue life insurance is best for people who may not qualify for a traditional life insurance policy and are considered a moderate health risk. 

You’ll have to answer a medical questionnaire and may not qualify if you have a critical illness, but there is no medical exam. You can get a simplified issue insurance policy with coverage up to $40,000 if you’re between the ages of 45 and 85.

→ Learn more about simplified issue life insurance

Guaranteed issue life insurance: For individuals with serious health issues

Guaranteed issue policies offer near-certain application approval.

In rare cases, insurance companies may ask “knockout questions” about terminal illnesses that disqualify you for coverage, but many insurance companies offer policies regardless of your health status. Because of this, guaranteed issue is more expensive than simplified issue and offers lower maximum coverage amounts — up to $25,000 — for people between the ages of 45 and 85.

→ Learn more about guaranteed issue life insurance

How much does burial insurance cost?

Because final expense policies are reserved for older or less healthy shoppers (who are considered riskier customers for the insurance company), the cost is exponentially higher. You'll pay more for a burial policy than you would for a term life policy and get much less coverage.

Below are sample costs for a guaranteed issue, simplified issue, and term life policies for a 60-year-old.

Type of life insuranceSexTerm lengthCoverageMonthly premium
Guaranteed issueFemaleLife$25,000$148.21
Male $186.07
Simplified issueFemaleLife$25,000$102.63
Male $124.85
Term lifeFemale10 years$250,000$58.41
Male $79.37

Methodology: Quotes are based on rates for a 60-year-old who qualifies for a $25,000 guaranteed issue policy, $25,000 simplified issue policy, and a 10-year, $250,000 term life insurance policy in a Preferred health class. Actual rates vary based on each customer’s specific circumstance. Rate illustration valid as of 3/16/2022.

Who needs burial insurance?

Because of its high cost, final expense insurance is best for people who typically have trouble finding affordable traditional life insurance coverage. This includes:

  • Older adults in their 70s and 80s

  • People with serious health conditions (including heart disease, cancer, HIV, or Parkinson's disease)

  • People who need less than $100,000 in coverage (which is less common in term life insurance)

Veterans and service members who don’t have savings to cover a funeral should also consider a burial insurance policy. Veterans Affairs offers some financial assistance, but only up to $2,000 for service-related and $796 for non-service-related deaths. [1]  

The best burial insurance for seniors

Burial insurance is sometimes the best life insurance option for seniors, who might struggle to qualify for coverage due to their age or health or who only need minimal coverage that a term life insurer won’t provide. Below are our picks for the best burial insurance companies for seniors.

AIG

4.6

Policygenius rating

How we score: Policygenius’ ratings are determined by our editorial team. Our methodology takes multiple factors into account, including pricing, financial ratings, quality of customer service, and other product-specific features.

AIG logo

With competitive pricing, AIG is a solid option for many life insurance shoppers, especially people with common health conditions.

Pros

  • Competitive pricing for all ages

  • Customizable term policies

  • More affordable premiums for people with common health conditions

  • Strong financial confidence

Cons

  • Below-average customer ratings

  • Complex website

AIG offers a guaranteed issue burial insurance policy that doesn’t require a medical exam or medical questionnaire. Approval can take as little as three days, and policies come with a terminal illness and chronic illness rider. AIG’s guaranteed issue policies offer coverage up to $25,000 and have a graded death benefit.

Mutual of Omaha

3.4

Policygenius rating

How we score: Policygenius’ ratings are determined by our editorial team. Our methodology takes multiple factors into account, including pricing, financial ratings, quality of customer service, and other product-specific features.

Mutual of Omaha logo

With competitive underwriting for a range of health conditions and strong financial and customer ratings, Mutual of Omaha is one of the best companies out there.

Pros

  • Competitive underwriting for a range of health conditions, like a history of cancer

  • No-medical exam options for older applicants

  • Strong financial and customer ratings

Cons

  • Policies are more expensive than the average

  • Slow turnaround time

Mutual of Omaha offers both simplified issue and guaranteed issue options with coverage up to $40,000 and $25,000, respectively, which makes it a great choice for burial insurance for seniors. Compared to other carriers in the Policygenius marketplace, Mutual of Omaha’s policies offer more flexibility and are available in more states. 

Mutual of Omaha also offers a plan with a level death benefit, instead of a graded benefit, so even if you die within the first few years of your burial insurance policy, your policy would pay out in full. 

Fidelity Life

3.3

Policygenius rating

How we score: Policygenius’ ratings are determined by our editorial team. Our methodology takes multiple factors into account, including pricing, financial ratings, quality of customer service, and other product-specific features.

Fidelity Life logo

Fidelity Life offers term and whole life insurance policies, including some no-medical-exam policy options.

Pros

  • No medical exams for some policies

  • Unique accidental death benefit policy

  • 30-day trial period

Cons

  • Higher-than-average rates

  • More consumer complaints than average

  • Whole life limited to age 50 and above

Fidelity Life provides three options for no-exam whole life insurance for people age 50 to 85. Fidelity’s RAPIDecison Senior Whole Life offers a much higher benefit than most funeral insurance companies or plans, up to $150,000. You’ll need to answer health questions, so Fidelity’s simplified issue or guaranteed issue options (offering coverage up to $35,000 and $25,000, respectively) are a better choice if you have serious health conditions.

Where to buy burial insurance

Many major life insurance companies sell some form of burial coverage. AIG, Mutual of Omaha, and Fidelity Life are just some of the top life insurance companies that offer burial policies.

Buying burial insurance is even more straightforward than buying traditional life insurance, because less personal information is required to apply. A Policygenius agent can help you figure out which final expense policies are best for your circumstances.

Ready to shop for final expense life insurance?

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Alternatives to burial insurance

Other than term life insurance, there are several other ways to pay for end-of-life expenses, including:

  • Pre-need insurance Also called pre-need funeral insurance or pre-need burial insurance, this type of permanent life insurance is offered by funeral homes and funeral directors.

  • Pre-need funeral trust This type of trust serves the same purpose as a pre-need funeral insurance policy, but rather than paying for an insurance policy, you contribute to a trust that earns interest over time.

  • Self-funded burial If you’re financially prepared for retirement, you may have the money you need to cover end-of-life expenses already. 

Pre-need trusts and insurance policies can be risky because the funeral home or service provider you’ve committed your money to could go out of business or change hands before you pass away. Self-funding your burial is usually the best alternative.

If you need financial protection and your age or health would disqualify you from getting traditional term life insurance coverage, a burial insurance plan is worth considering. Always speak to a licensed expert who can help you compare policies before committing to a coverage option.

Frequently asked questions

What is a burial insurance policy?

Burial insurance, also called final expense insurance, is a type of permanent life insurance with a lower death benefit meant to pay for end-of-life expenses.

Is burial insurance worth getting?

If you can’t cover your end-of-life expenses with your own savings and don’t qualify for a more affordable policy, burial insurance is worth considering.

What are the different types of burial insurance?

There are two types of burial insurance: guaranteed issue and simplified issue. Guaranteed issue has fewer medical restrictions, but also has lower benefits and higher rates.

What is the difference between whole life insurance and burial insurance?

Burial insurance and whole life insurance both offer permanent coverage, but burial insurance has a lower maximum death benefit and is meant to pay for funeral and burial costs.