Living life without life insurance is an immense risk. So much of what happens in life is ultimately out of our control. Life insurance acts as a security net against risk. Unemployment, a random accident, medical emergency or an unexpected death can create incredible financial burdens. Especially for people who live on fixed incomes, are financially unprepared to deal with emergencies and who don’t have any life insurance.
Which, unfortunately, describes how many senior citizens go through life. Life insurance becomes more expensive the older you become. The closer you are to the end of life, the more financial risk is assumed by the insurer. Most senior citizens who consider getting life insurance late in life may not be able to afford it. The average annual income for senior citizens aged between 65 and 74 is about $36,300. That number drops to about $25,400 a year for senior citizens over 75.
People in advanced age who worry about paying for their end of life expenses, like a funeral, may not be able to afford it. They may be medically or mentally infirmed by the advancement of old age. Or, they may not have anyone to care for their end of life financial needs. If you are the adult child of parents in need of life insurance protection, you can purchase burial insurance on their behalf.
The Basics of Burial Insurance
Burial insurance is a bare-bones version of a life insurance policy. Burial insurance is used to pay for all funeral and burial related expenses. Any named beneficiary will receive a coverage payout, which can be spent in any manner, to pay for funeral expenses. The average burial insurance policy is worth anywhere between $2,000 to $25,000. The average funeral has a cost range between $7,000 to $20,000. Burial insurance provides just enough coverage, depending on the policy, to cover such costs.
Of course, more valuable policy packages can be purchased at greater expense. Burial insurance can be purchased from funeral homes or insurance companies. You will be better off inquiring about coverage from various agents and comparing quotes. Funeral homes will refer you to insurance companies they are affiliated with. The application process can be completed over the phone in minutes without a medical exam. Premiums could cost $20 to $100 a month, depending on the policy.
Buying Burial Insurance For Your Parents
The process of buying burial insurance for your parents varies from company to company. Firstly, your parents would have to sign their consent on an application and/or acknowledge consent via a phone interview. Your parents would have to acknowledge their consent since you would probably be the policy beneficiary.
As the adult child, you would also have to explain your insurable interest. In other words, you would have to prove that the death of your parent would cause incredible financial stress upon you. For example, you would have to pay for their funeral or pay for their outstanding bills. You will also have to clarify whether you or your parents will be paying the premium.
Benefits of Buying Coverage for Your Parents.
For one thing, you would be securing the end of life expenses for your parents. If your parents can’t afford their funeral, paying for it yourself may become a huge financial stressor. If they are physically or mentally informed, you would also have the satisfaction of knowing that you are attending to their needs. Also, you may be more equipped to research and find affordable burial insurance coverage that suits their immediate needs than your parents.
Consult With Your Parents
Have a talk with your parents. Find out their needs and discuss buying burial insurance in their stead. Then compare policies and consider your options. If you are going to buy burial insurance for your parents, find a policy with the most beneficial terms for you and them.