Many Australians are taking funeral insurance and cover. So what does it actually entail and why should someone take it?
The life insurance Australia is meant to cover the cost of a funeral should the policyholder suddenly pass away. Those left behind will be shielded from the high costs of arranging for a memorial service by the policy. When purchasing the insurance, you will decide whether it should cover the cost of purchasing the coffin only or also the flowers and other details.
The main reason for taking the cover is to enable your loved ones have an easy time when you pass away. Funeral costs can be very high and can deplete the budget of those left behind. With the policy, your loved ones will not have to worry about the cost of arranging for the memorial or buying a coffin.
The average cost of funerals for those who do cremation is about $5,000. Those who opt for burial even pay higher, usually above $7,000. Families that wish to have a more extravagant memorial may have to pay above $20,000. With these costs coming at a time when loved ones are mourning, it can be a great burden to them. Funeral insurance will cater for these costs.
Funeral cover works like most insurance covers. The policyholder will pay a monthly premium depending on the memorial activities he wishes to cover. Typically, the payments are made until one reaches 60 years of age. However, the cover is applicable at death, regardless of the age at which the policyholder passes away.