The terms ‘life insurance’ and ‘funeral plan’ are often mistakenly used to mean the same thing; indeed, life insurance is commonly advertised as a means to pay for your funeral, but the two are, in fact, very different.
A funeral plan is a secure way of financing your funeral by putting aside money that is only used for that purpose. It enables you to organise your farewell – including any personal touches – and fixes the services included in your plan at today’s prices, which could save you money in the long term.
Capital Life has a wide range of funeral plans to suit all budgets with various payment options, including the ability to pay upfront or in monthly instalments. The advantage of a funeral plan is that it always pays out, leaving you safe in the knowledge your funeral is paid for and that the financial burden does not fall on your family.
Life insurance pays a lump sum to your loved ones in the event of your death. If you have dependants who rely on you financially, a life insurance policy could help them pay your mortgage and cover any other expenses, pay for your funeral. Alternatively, your lump sum can be left as inheritance.
Like a funeral plan, you pay a fixed monthly amount until the policy is paid for. However, you don’t actually have the opportunity to plan your funeral, nor is the pay-out guaranteed to cover the whole thing. Furthermore, life insurance will only pay out if the policy is in force, and even then, it may take some time. You could also end up paying in more than is paid out.
Both a funeral plan and life insurance have their advantages, but can you have both? Simply put, yes, you can! Some life insurance policies even have an option to buy funeral cover as an extra add-on to the policy.
Life insurance pays a lump sum when you die, which could pay for your funeral, while a funeral plan covers all funeral expenses – and yes, you can have both.
To see how a funeral plan could benefit you, contact us now or call 0800 411 8683 and one of our friendly advisors will be happy to discuss your options.
We can also assist with Inheritance Planning, Wills, LPAs and Probate.