What is funeral coverage?
Funeral coverage or funeral insurance is a type of insurance that pays a lump sum when you, the beneficiary, die. You can also purchase family funeral coverage, sometimes called supplemental coverage, which pays a lump sum in the event of the death of your partner/spouse, child(ren) and/or any other family member you choose to cover with the policy. The money paid is intended to help with funeral expenses.
Why you should have funeral coverage
There are few things in life as tragic and heartbreaking as an unexpected death in the family. This trauma is only compounded if, while trying to come to terms with their loss, the family is faced with the cost of arranging a funeral to also honor the memory of their loved one.
Did you know that South Africa has, on average, some of the highest funeral costs in the world? A funeral can be financially ruinous if you do not expect it or if your deceased did not plan it. Depending on your family's tradition or custom, costs can run into the tens of thousands of rand, if you include funeral expenses, the purchase of the burial plot and more. That's a lot of money to pay out of pocket!
The benefits of funeral coverage
A funeral insurance policy helps you cover these costs by paying you a lump sum upon the death of the policy's designated beneficiary. These payments are generally faster than other types of insurance, such as life insurance, which means that funding the funeral is the only thing you don't have to worry about right now. Depending on the funeral coverage policy, payments may include airtime, flowers, catering and tent rental, among other necessities.
Life insurance is based on an individual's profile and needs, which comes with complex underwriting requirements, making it comparatively more expensive. Funeral coverage does not have this problem. Thus, funeral coverage is cheaper and easier to obtain compared to life insurance. However, most funeral insurance policies will have a waiting period for natural deaths of 6 to 12 months, so if you want funeral coverage with no waiting period, you must specify this need.
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