The Increasing Cost of Dying
Death is an inevitable conclusion to life and when someone dies, surviving loved ones often hold a funeral as a formal send-off.
Unfortunately, rising funeral costs are making it more difficult for many UK residents to afford this tradition.
According to research from Sun Life Direct, the basic funeral cost increased by 6.2 percent between 2011 and 2012.
It now costs more than £3,200 to have even a simple funeral ceremony, making it more important for people to provide financial protection through life insurance.
Death Becomes More Expensive
Since 2004, the cost of a basic funeral has increased by an unbelievable 71 percent. Charges imposed by funeral directors are increasing and cremation costs are rising by as much as seven percent annually.
An October 2012 article in the Daily Mail Online revealed that some grieving families were forced to leave bodies of loved ones in mortuaries for months because they could not afford burial expenses. The social welfare cap for funerals has been unchanged for nine years at just £700, leaving many relatives on benefits without the financial means to bury their loved ones.
The Department of Work and Pensions Social Fund is reluctant to pay money until a funeral date has been arranged. At the same time, funeral directors require deposits to arrange funerals, placing many families in unsolvable situations. Though some hospital mortuaries will keep bodies as long as necessary, loved ones are usually unable to bear the thought of this.
They may resort to drastic measures such as selling prized family heirlooms or other assets to pay funeral bills.
An Answer to the Problem
According to the Sun Life Direct study, 27 percent of people have not established plans to pay for their funerals. Taking a loan or working a second job may not be an option for many surviving loved ones. It might seem morbid to think about your own funeral costs but with the associated expenses increasing each year, it has become necessary. A life insurance policy is one of the most popular ways to pay for funeral costs.
Purchasing life insurance at a young age ensures that no matter what happens in the future, surviving family members will not need to worry about your funeral expenses. Though life insurance premiums increase with age, this cover may still be cost-effective into the adult years.
Over 50s life insurance plans are commonly purchased to cover funeral expenses. Many of these feature guaranteed approval and premiums that will not increase over time.
Life insurance cover also helps survivors to cover their own living expenses. Once the funeral is held, loved ones must figure out how to pay the mortgage, utility bills, and debts left behind by the individual. Payout from a life policy can cover some or all of these expenses, making it much easier for the family to go on.
Parents or grandparents may even name minor children as beneficiaries to provide for their university education. Funeral costs are just the beginning of expenses that can be covered by a life insurance payout.
