Here's how a funeral life insurance plan generally works:
Choosing a policy: Individuals interested in purchasing funeral life insurance can select a policy that suits their needs. These policies often have lower coverage amounts compared to traditional life insurance policies, typically ranging from a few thousand dollars to $25,000. The coverage amount depends on the individual's desired funeral arrangements and related costs.
Application process: To apply for funeral life insurance, individuals need to complete an application, which may include providing personal information, medical history, and sometimes undergoing a simple medical evaluation or answering health-related questions. The application process for funeral life insurance is usually more straightforward compared to traditional life insurance, with fewer underwriting requirements.
Premium payments: Once the application is approved, the insured individual pays regular premium payments to keep the policy in force. Premiums can be paid on a monthly, quarterly, or annual basis, depending on the policy terms. The premium amount is determined by various factors, such as the age, health, and coverage amount of the insured person.
Beneficiary designation: The insured person designates a beneficiary who will receive the death benefit upon their passing. The beneficiary is usually a family member or a trusted individual responsible for handling the funeral arrangements and expenses.
Death benefit payout: When the insured person passes away, the designated beneficiary files a claim with the insurance company, providing the necessary documentation, such as a death certificate. Once the claim is verified, the insurance company pays out the death benefit to the beneficiary. The beneficiary can then use the funds to cover funeral costs, burial or cremation expenses, memorial services, and any outstanding debts or bills.
As for why people in Georgia, or any other state, purchase funeral life insurance policies, there are several reasons:
Financial protection: Funeral expenses can be quite significant, and many individuals want to ensure that their loved ones are not burdened with these costs after their passing. Funeral life insurance provides a financial safety net, allowing families to focus on grieving and honoring the deceased without worrying about the financial implications.
Ease of qualification: Funeral life insurance policies often have more relaxed underwriting requirements compared to traditional life insurance policies. This means that individuals with pre-existing health conditions or older individuals who may have difficulty obtaining other forms of insurance coverage can still qualify for funeral life insurance.
No medical exam: Many funeral life insurance policies do not require a medical examination or have limited health-related questions during the application process. This makes them more accessible for individuals who may have health concerns or prefer not to go through a comprehensive medical evaluation. Get a funeral life insurance quote.