What happens if you don't have funeral cover?

There are many reasons for not having funeral cover, and they seem so valid at the time. Nobody likes to think about dying, after all. But are you financially prepared to pay for a funeral if a loved one dies? Or, will your family be able to pay for your funeral? Funeral cover pays your expenses and provides much-needed funds if you or a family member dies.

When we’re young, we might wonder why is funeral cover important? But when we approach our forties and fifties we wonder what might happen if we don't have funeral cover when we die. Furthermore, have you thought about whether you could afford to pay for a funeral if a family member dies, without getting into debt?

While some people have comprehensive funeral plans with sufficient funeral cover to provide for a proper burial, others die before they have an opportunity to ensure their loved ones are able to pay their funeral costs. Funerals are expensive and can quickly drain a family’s savings. If you don't have funeral cover, your loved ones could be left with a financial burden.

What happens if you don't have funeral cover?

The greatest risk of not having funeral insurance is that your family will face financial hardship after your passing. Or, would you need to borrow money or solicit help from other family members to cover the funeral expenses of a loved one?

If a family member you've insured under your insurance passes away, funeral cover benefits will give you the peace of mind that comes with knowing that you'll have money set aside to cover funeral expenses. Funeral cover benefits (which differs from one provider to the next, but which could include transportation, grocery money, and tombstones) make it much easier to deal with the death of a loved one and make funeral arrangements.

Why is funeral cover important for you and your family members?

If you don’t have funeral cover, your family will have to handle the funeral arrangements in addition to dealing with the loss of a loved one. A basic funeral these days can cost tens of thousands of rands. Without the advantages of funeral cover, they will have to deal with the additional burden of paying for a funeral if there is no money available.

The emotional impact of unplanned funerals

Death is always an emotional time. The grief you feel when a loved one passes can overwhelm you and leave you feeling unable to cope with even basic tasks. This is not a good time to make decisions, especially when they could impact your and your family’s finances. However, planning a funeral does require you to make decisions that have a financial impact, putting you under extra stress and strain! The emotional impact can continue to affect you for months and years to come. If you have funeral cover, you won’t have to worry about where to find funds for a funeral, which will reduce your stress levels.

Logistical challenges in funeral arrangements

Funeral arrangements require managing schedules and budgets, dealing with different service providers such as undertakers and caterers, as well as ensuring family and friends are informed and have transport to the service, and accommodation if necessary! You will also need a death certificate from the Department of Home Affairs, you will be required to choose a coffin or a casket, find a burial plot, hire a chapel for the service and possibly tents, and organise food and beverages for the mourners. It’s a lot to arrange!

The benefits of choosing the right funeral cover

If you are shopping for funeral cover, asking the right questions will ensure that you choose the best possible cover for your family. You should find out how many family members and extended family members you can add to your policy as well as how much is paid out per member. Most reputable funeral insurance cover policies start at about R5 000 and often cover you up to R100 000.

When making the decision to buy funeral cover, always consider the additional benefits (grocery, tombstone, or similar) that come with your policy. When combined, the value of your funeral policy payout and the added benefits will likely outweigh the small monthly premium.

Ask your provider how to claim on your policy and how long claims take to pay out. The majority of funeral insurance companies in South Africa will pay your or your family out within 48 hours of a valid claim. This is contingent upon receiving all of the necessary paperwork.

In conclusion, not having funeral insurance can greatly strain your family if you or a family member should pass away. Keep in mind that even if you have life insurance, you probably won't receive a pay-out right away. This implies that your family will need to raise funds to ensure that you have the most respectable send-off possible. One of the main advantages of funeral cover is that the policy pays out quickly and when it’s needed most.

Still have questions about life insurance and about the advantages of funeral cover? Contact a 1Life call centre agent to conduct a Financial Needs Analysis, or FNA. The agent will walk you through the analysis and ask you questions about your income, assets, income, and liabilities to help you decide how to best prepare for your family's future.

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Are there alternatives to funeral cover for covering funeral expenses?

Loan-free alternatives to funeral cover include getting a life cover. With 1Life Insurance, the main member's chosen beneficiary can receive a R50000 pay-now benefit to assist with funeral costs. However, this option excludes the grocery and repatriation benefits that come with a funeral policy. Furthermore, this option cuts into the money your family might need for long-term expenses following the funeral.

In the South African context, stokvels and burial clubs are also alternatives to funeral cover, but may sometimes be vulnerable to a higher risk profile than getting funeral cover from a reputable life/funeral provider.

How much does a basic funeral cost without funeral cover?

The cost varies, depending on factors like whether it is a burial or cremation, the type of casket and headstone and how many mourners are catered for. A small and simple funeral might cost R6 000, but costs can easily add up to over R20 000. A large, elaborate funeral can cost R50 000 or more.

How quickly do funeral cover benefits pay out?

Qualifying claims can be approved in as little as 5 minutes, and claims paid out within 24 hours, only if all the correct documents are received.

Can I claim funeral cover benefits for deaths outside the country?

Yes. However certain terms and conditions, and exclusions, may apply as stipulated in your policy documents.

What is Financial Needs Analysis (FNA), and why is it important?

A Financial Needs Analysis (FNA) is a crucial evaluation of your financial situation. It considers income, expenses, assets, and liabilities, providing a holistic overview. With an FNA, you can align your goals, make informed decisions, and strategise for the future. You can contact 1Life Insurance to speak to one of our trusted Financial Advisors to tailor advice based on your individual circumstances .