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Life Insurance to Cover Funeral Costs
Old 10-31-2011, 02:16 PM   #1
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Life Insurance to Cover Funeral Costs

What is the logistics that's usually involved with life insurance to cover funeral costs? For example, let's say, there's a $30K life insurance policy and funeral costs costs $10K.

Would the insurance company just distribute 30K? Or would the insurance company distrubute 30K, plus to cost of funeral, in this example, an additional 10K?


Thanks.
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Old 10-31-2011, 02:44 PM   #2
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My wife died 9 years ago with a 200k life policy. The insurance company just faxed the funeral director a "promise to pay document" for the amount of the funeral when I was making the arrangements, so there was no out of pocket on my part.

I got the check from the insurance company which was about 190k as the funeral cost was deducted. I am sure that they also sent a check to the funeral director for the 10k.
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Old 10-31-2011, 04:42 PM   #3
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Thanks for the answer. Nice that at the time of grieving, you didn't have the extra stress of having to pay out of pocket.
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Old 10-31-2011, 04:52 PM   #4
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My wife died 9 years ago with a 200k life policy. The insurance company just faxed the funeral director a "promise to pay document" for the amount of the funeral when I was making the arrangements, so there was no out of pocket on my part.

I got the check from the insurance company which was about 190k as the funeral cost was deducted. I am sure that they also sent a check to the funeral director for the 10k.
Same with us when my Dad passed away, insurance company paid funeral compnany directly, balance to the estate. (my sister was executor)
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Old 10-31-2011, 05:16 PM   #5
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How much does a typical funeral cost nowadays? Is there a website (kind or morbid..I know) that shows typical prices? Visitation, showing, creamation. No burial.
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Old 10-31-2011, 05:28 PM   #6
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I really depends on if you want cremation or burial. (Burial is a lot more). A simple cremation would be in the 2-3k range, as noted a burial 8-10k plus the cost of the plot. The 2k example included no visitation or mortuary involvement in the memorial service.
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Old 10-31-2011, 06:09 PM   #7
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Thanks for the ballpark amounts. It helps in my thinking.

The reason I have these questions is my friend (I've mentioned her before in other posts) that I try to help out, is in very ill health and the issue about life insurance, funeral, etc. comes up now.
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Old 10-31-2011, 06:16 PM   #8
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Just went thru this with MIL. Cost for traditional funeral was $4k not including plot or marker. Costs actually came down $1k from identical services for FIL 12 years ago. Made me think that prepaid might not be that great a deal.
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Old 10-31-2011, 08:15 PM   #9
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It was $0 for my deceased MIL to be cremated as she took a detour through the University of Cincinnati medical school, i.e. she donated her body to science. Her ashes were returned to my BIL this summer which was about 2 years after her death. He took her back east and sprinkled her in places she lived and loved. Exactly as she wanted.
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Old 10-31-2011, 08:46 PM   #10
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I spent $3200.00 when my Mom passed away in February. This was for a cremation and a memorial service. I didn't show her, but had a poster with pictures. It also cost around $400.00 to have the obit in the newspaper for 2 days.
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Old 11-03-2011, 07:38 PM   #11
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It was $0 for my deceased MIL to be cremated as she took a detour through the University of Cincinnati medical school, i.e. she donated her body to science. Her ashes were returned to my BIL this summer which was about 2 years after her death. He took her back east and sprinkled her in places she lived and loved. Exactly as she wanted.
I've donated my body to the local medical school; Mother did so also.
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Old 11-04-2011, 07:44 AM   #12
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I've donated my body to the local medical school; Mother did so also.
She donated your body?
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Old 11-04-2011, 07:59 AM   #13
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My FIL passed away last year. His wife had passed earlier and they had plots already paid for. FIL had told us that funeral arrangements were all taken care of. Went to the funeral home to make final arrangements. Were shown paperwork that indicated that Dad had made down payment of $1000 on funeral but then failed to follow through with paying the balance, despite at least three letters sent to him by the funeral home.

The bottom line was, we had to write a check from our own account for $8700 on the spot (later reimbursed from his estate).
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Old 11-04-2011, 08:34 AM   #14
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I used a trust at a local funeral home to prepay for my Mother's funeral while she was still alive. I think they had to purchase an insurance policy with the funds. It all worked out... but this arrangement was made when she was using hospice. It was not like paying for something 25 or 30 years in the future.

I just began looking into all of the alternatives for DW and I.

I am a little wary of giving money to the funeral home directly to be put in some sort of escrow or trust for an event that could be 30+ years away. I am leaning toward a couple of small life insurance policies with a large and highly rated insurance company.

I plan to make some sort of decision in the next year... but still have to do more research.

I would be interested in hearing how others have approached this type of preparation for themselves..
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Old 11-04-2011, 09:18 AM   #15
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?

Why insure for a ~ $10,000 - $30,000 (or whatever) expense? Unless this is a very significant portion of your net worth. Why not just pay it when the time comes (this is separate from pre-arranging, making decisions, etc).

Do you all buy 'I need to buy a new car insurance', or 'new roof insurance'? I don't get it.


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Old 11-04-2011, 04:51 PM   #16
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She donated your body?
Mother donated her own body; from what little contact I've had with family it seems it was followed through.
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Old 11-04-2011, 04:53 PM   #17
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Old 11-04-2011, 05:39 PM   #18
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Mother donated her own body; from what little contact I've had with family it seems it was followed through.

I'm pulling your leg. My mom also gave her body to a medical school.
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Old 11-04-2011, 06:52 PM   #19
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I've donated my body to the local medical school; Mother did so also.
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She donated your body?
The interpretation of "did so" raises an interesting grammatical issue, which (as I understand it) I am precluded from commenting on here.
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Old 11-04-2011, 06:56 PM   #20
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The interpretation of "did so" raises an interesting grammatical issue, which (as I understand it) I am precluded from commenting on here.
Oh, please do. We all await your wisdom much as trapped miners await a rescuer.
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