If I purchase a pre-paid funeral plan, is there any insurance that will fund my expenses for this plan?

You have several options to fund your pre-paid plan through insurance.

Purchase Funeral Insurance From An Insurance Company

You can purchase a policy that typically ranges from $3000 to $15,000 from an insurance company, made payable to a beneficiary immediately after your death. These funds do not go through probate.

The money is intended to cover funeral expenses but can be used in any way the beneficiary wants. This option is also known as “final expense insurance,” “burial insurance,” or simply “funeral
insurance”.

Purchase An Insurance Policy Or Trust Through A Funeral Home

If you purchase a policy or trust through a funeral home, you will have to specify a number of details such as the particular funeral home and the specific products and services you want.

This plan will only cover those products and services directly provided by the funeral home, for instance, the casket, urn, use of the funeral home chapel, etc. Outside items such as floral
arrangements, clergy fees, and cemetery fees would not be covered under this type of plan.

With this plan, the funeral director acts as an insurance agent and receives a commission on the sale of the policy or a fee for setting up the trust. The beneficiary on the insurance policy and trust is the funeral home.

Purchase A Life Insurance Policy From An Insurance Company

You may use the benefit from any term or life insurance policy to pay for funeral expenses. If you need insurance money only to pay for funeral expenses, you can purchase funeral insurance from an insurance company in smaller amounts than what is typically offered in a term or whole life policy.

At your death, the money passes automatically to the named beneficiary without having to go through probate. The money is intended to cover funeral expenses but can be used in any way the beneficiary wants.