After You''ve Gone

By Author: Lecia Selbo
Total Articles: 49
Comment this article

Nobody likes to think about dying, let alone what will happen to our loved ones in our absence. However, with the cost of dying actually becoming more expensive, we should all spend a little time planning for the inevitable.

According to Mintel''s Funeral Business Report, funerals cost ?716 in 1988. By 1997 this had risen to ?1,284 and by 2006 it was ?2,311. Even when taking inflation into account, this is still ?1000 more than it was in 1988.

When you die, it''s going to be hard enough for those people left behind. What do they do about paying the bills, the mortgage or food in your absence? But, more importantly, how can they afford to pay over ?2,000 for your funeral on top of all this?

One of the best ways to ensure your loved ones don''t have to fork out the costs for your funeral is to take out some form of funeral plan.

In general terms there are two types of funeral plan you can choose from. Whole-life insurance is the first option. These are more specific life insurance policies that pay out a fixed amount upon your death which is relative to how much you pay each year. The payout therefore ...
... can cover all kinds of expenses from your funeral to paying off a mortgage.

However, depending on how long you live and or when you take out the policy, you could end up paying more in premiums than the policy will pay out upon your death.

The second option is more simple. You can get just a pre-paid funeral plan that can either be sold by an insurer, or directly by a funeral director. This type of plan involves paying for your funeral in advance, but they only include the actual funeral fees, not third-party costs such as those incurred by the crematorium. They won''t cover the wake or the cost of flowers either.

There are certain things you need to check for when taking out a funeral plan policy. Firstly, what level of choice is involved? I.e. can you choose the funeral director? Also, what happens if your chosen funeral director goes out of business, will you be covered elsewhere?

You also need to think about location. Will your policy cover repatriation if you die overseas? What third party costs are included?

A big question to answer is whether it is easy to cancel your policy? Plus, if you do cancel, do you get everything you paid into your policy back? Many insurers charge cancellation fees and some even keep a huge amount of what you paid in. Lecia Selbo is a financial expert with over 20 years industy experience. They recommend Legal and General for funeral plans.