There are many different types of insurance policies. They include home and car insurance to covering your pet. All of them are designed to help you prepare for expensive and unexpected situations, such as car accidents, freak storms, or illness.
There are also a couple of different types of life insurance policies. Term Life cover is popular in New Zealand but an alternative option is Funeral Insurance.
Here are a few things you should know.
What is Funeral Cover?
Funeral insurance is also referred to as burial insurance. It’s designed to cover end-of-life expenses exclusively, such as the costs associated with burial or cremation.
How is it different from Life Insurance?
Funeral Cover is a ‘guaranteed issue’ product, which means that Funeral Cover is offered with no health questions asked, and the policy is emailed to you immediately online. For Life Insurance you need to provide information about your health and lifestyle when you apply.
With Funeral Cover the premiums stay the same every year, but once you turn 85, you stop paying - and your cover continues free of charge until you die. Life Insurance premiums go up every year as you get older.
Like our Life Insurance, Pinnacle Life’s Funeral Cover pays out a cash value to your named beneficiary and can then be used any way the beneficiary sees fit. But you should be aware that funeral cover from some providers, will only pay the costs directly related to paying for your funeral which means it can’t be applied to anything else.
Do you need both?
Do you need both a funeral policy and a life insurance policy? It's not a bad idea. Your regular insurance policy could be used for your funeral costs. However, it may not pay out as quickly as funeral insurance. This leaves loved ones to foot the bill up-front.
Pinnacle Life is all about keeping things as simple and easy as possible. Remember that insurance is not just for you, it’s for those you care most about, so you need to think about what will help them out the most should the unexpected and expensive worst case scenario happen.