No one likes to think about their eventual death, but it’s even more disturbing to think about leaving your loved ones burdened with significant costs when you die. Final expenses can pile grief and hardship on those we leave behind if adequate insurance isn’t secured. While it’s an unpleasant notion, it’s one that many Americans share.
The London International Insurance and Reinsurance Market Association (LIRMA) carried out a survey in 2015 that yielded some interesting statistics about these issues.
Many of the Americans surveyed were greatly concerned about burdening their dependents and heirs when they died:
Many were also worried about leaving burdensome funeral expenses:
The same research showed that leaving an inheritance was also a major financial concern for Americans. 50% of those 25 and younger feared they wouldn’t have enough saved, or that their final expenses would consume their savings, leaving nothing for their dependents. This concern was shared by 38% of those 25 to 44 and 27% of those 45 and older.
The cost of funerals has increased dramatically in the past 50 years. According to the National Funeral Directors Association, a funeral cost around $700 in 1960. By 2006, the average cost of a funeral for an adult was more than $6,000, and it’s around $10,000 today. Perhaps that is one reason for the dramatic increase in the number of cremations in the U.S. According to the Cremation Association of North America, cremations have increased from about 3.56% in 1960 to about 40% in 2010.
Opting for cremation rather than a traditional burial can help reduce final expenses, but can still be costly. According to the Cremation Research Council, the average cost of a direct cremation is $1,100; it’s $2,000 to $4,000 if arranged through a funeral home. Final expense insurance can make sure those costs don’t add to the stress your loved ones experience when you die.
During the 2015 LIRMA survey, 51% of the respondents said that the main reason for buying life insurance was to cover burial and other final expenses, an increase of 3% in just four years. There are several types of life insurance policies that can help cover your final expenses, but which is right for you?
Although many Americans are worried about financially burdening their loved ones with final expenses, several misconceptions about this insurance prevent them from purchasing coverage. The LIRMA survey found that the reasons some go without included:
Some kinds of final expense insurance are even more affordable than a 20-year term policy. If you are unsure of what type is best or how much coverage you need, find a professional to help you navigate the various options to find a policy that meets your goals.
It’s important to work with a knowledgeable, independent insurance agent when choosing a final expense policy. Trusted Choice® agents work for their clients, not an insurance company. That means they will assist you in finding a number of quotes with the coverage options you need so you can be certain to find the right policy at the most affordable rates. These agents can answer any questions you may have and leave you with peace of mind, ensuring your loved ones are not burdened with your final expenses. Contact a local agent today to find a customized policy that works for you.