Pre-paid funeral plans are fast becoming one of the most common ways a funeral is funded. In the past year we have seen this increase to 1 in 6 funerals compared to 2010 when it was close to 1 in 25.

There are many ways a funeral plan can be funded and for those aged under 78 the choices can include a whole of life scheme using fixed monthly payments or paying over a term, with a low cost instalment option, which finsihes in your 80th year.

We are often asked which option is best. Whilst we feel it is important to let each individual pick for themselves, we have below given the main differences between them.

Most whole of life based products mean you pay for life or until you are aged 90, compared to our funeral plan low cost instalment option which has to finish in your 80th year. Once you have been paying your whole of life premium for 2 years you are often covered then for your full amount if you die before reaching 90, but you cannot stop paying your premiums as defaulting on this invalidates your policy. With a funeral plan if you decease prior to making your last payment then the funds you have paid plus interest are paid to the funeral director and any shortfall is paid from your estate.

Also most whole of life products only pay out the agreed figure you insured for at the beginning, compared to a funeral plan which guarantees for the future the funeral director services you selected and includes an allowance for the third-party costs such as crematorium or burial fees.

For example someone aged 75 chooses our option 3 funeral plan totalling £4,350.00 and wish to pay over a term of years. The low cost instalment funeral plan allows them to pay for a maximum of 5 years compared to the whole of life insurance which will run for all of life or until aged 90.

The low cost instalment option is £79.21 per month, which at aged 80 totals £4,752.60 paid. The whole of life insurance option costs slightly less at this age of £76.49 per month but the person lives to 90 years and finishes payments, in doing so would have paid a total of £13,768.20 – almost 3 times the low cost instalment option and for 10years longer!

As we said, it is alwasy up to each individual person to choose the financial product that they feel best suits their needs, but hoped we have shown the benefits of a funeral plan versus whole of life insurance.

For more information on the funeral plans we offer please visit our pre-paid funeral planning page or contact us 01202 882134 and we can provide you with a personalised quotation based on your wishes,age and budget.

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