No long-term financial plan is complete without a measure in place to cover the cost of final expenses like burial, cremation, or funerary services. Contrary to what some may think, the average cost for a funeral service, burial, and headstone can be quite expensive indeed. Many averages can easily reach $10,000 or more, depending on where you live.
This leads many to ask the question, “How much does burial insurance cost?”. It seems like in today’s world, there’s insurance available for almost everything. So, how reasonable is the cost of insurance that will cover final expenses?
The answer depends on a few factors, which we’ll go through one-by-one.
Factor #1: Age
Regardless of what kind of life insurance you buy—whether it be term, whole, or burial—there is a general rule that applies to premiums. That rule is that the older you are, the more expensive your premium is going to be for a new policy. And so, the first factor that is going to impact the cost of burial insurance is age.
At age 50, it’s not unreasonable to find the best burial insurance available for about $25 per month in premiums for about $10,000 in coverage.
At age 55, premiums for new burial insurance policies can be between $28 and $45 per month, also for the same $10,000 in funeral expense protection.
At age 60, premiums take a sharp jump, putting averages in the $50-$80 per-month range.
At age 65, the same $10,000 in final expense coverage is going to probably cost between $75-$125 per month.
The next steep rise in burial expense insurance premiums comes at around age 75, when monthly premiums get into the $150+ range.
Factor #2: Gender
Insurance companies use actuarial data to arrive at the prices they charge for the insurance products they sell. This actuarial data suggests that, on the whole, women live longer than men. This means that the monthly premiums for most burial insurance, Colorado included, are slightly lower for women than for men.
The older men and women get, the more drastic this premium pricing difference can get. For example, a 75 year-old man might expect to pay about $125 a month for $10,000 in burial insurance coverage. A 75 year-old woman, however, might only end up needing to pay $95 a month for the exact same coverage.
Factor #3: Tobacco Use
Those who use tobacco tend to lead shorter lives. The research on this is fairly clear, which is why insurance companies don’t bat an eye when they charge so much to cover those who smoke or use chewing tobacco.
When it comes to burial expense insurance, almost all insurance companies are going to screen new policyholders for tobacco use. If the covered person is a user of tobacco, the premiums for burial insurance are almost certainly going to be higher than if the person didn’t use tobacco at all.
How much higher? That depends on the insurance coverage provider and the other two factors listed above. Even still, we can provide a rough estimate as to how much more a tobacco user can expect to pay for burial insurance compared with a non-tobacco user. That estimate is about 20%.
So, if you’re looking for final expense insurance coverage for a tobacco user, you can expect to pay about 20% more in premiums.
Factor #4: Amount of Coverage
As we’ve already mentioned, the average cost for final expenses can often get into 5-figure territory. However, that doesn’t mean that a $10,000 burial insurance policy is for everyone. For example, some people may not wish to be buried at all or to have a funeral after their passing. For these individuals, a lower amount of coverage would make more sense.
On the other hand, many people wish to have more than enough coverage to account for all death-related expenses, to include the funeral, burial service, headstone creation, and more. For these individuals, a $25,000 or even higher coverage amount would be more suitable.
For Your Customized Quote, Contact Us Today
Now that you have a good idea of how much burial insurance can cost and what factors affect premiums, why not take the next steps to get a quote? At Shell Mutual Insurance, we make it easy to obtain industry-leading coverage from some of the most respectable insurance providers in the market today, all for a monthly premium that will fit within your budget.
Contact Shell Mutual Insurance today to learn more.