Compare ways to pay for your Funeral

When you’re getting on with life, thinking about your funeral expenses is probably the last thing on your mind. Yet you may be surprised to learn how much the average funeral costs these days. Even the most modest service can be expensive, starting from $4,000 for the essentials up to $15,000¹ for something more elaborate. It’s not so surprising when you consider all the different elements that may need to be arranged:

  • Casket
  • Service (chapel or venue hire)
  • Funeral director’s fees
  • Crematorium costs or burial plot
  • Flowers
  • Memorial booklet
  • Transportation

That’s before you start thinking about the kind of wake you’d like, which can be anything from a few drinks at the local to a big affair requiring a venue, catering and an event organiser.

Sorting out your funeral expenses in advance is just another great thing you can do for your loved ones. If you want to make it easier for them, you have several options: take out funeral insurance; pre-pay with a lump sum or regular instalments; or buy funeral bonds.  Let’s take a look at how these different options can work:

Funeral Insurance

Funeral insurance is one way to ensure your funeral can be paid for. Like other types of insurance, you pay regular premiums (ongoing payments) for a fixed amount of cover (usually between $1,000 and $15,000). The cover amount is paid to your beneficiary (the person you want the money to go to) when you die.

Funeral insurance policies can vary a lot between providers, so it’s important to find out as much as possible about the plan you’re considering before you sign up. This can be a bit of a minefield if you are new to the whole thing. When researching funeral insurance, there are a few important questions you should ask your insurer.

Find out if the premiums (regular payments) will increase over time

With some insurance companies, your premiums will increase as you get older. With Insuranceline, as long as you don’t make any changes to your cover, your premium won’t go up just because you get older².

Check to see how long the insurance payout will take to come through if you need to claim

Depending on what is required to make a claim, an insurance payout could be delayed. Some insurance companies can take a while to pay a claim. You really shouldn’t have to wait long and with Insuranceline, you’ll generally receive a pay out within 24 hours of sending in a complete, valid claim.

Can I change my mind once I’ve purchased a policy?

You should always be able to feel comfortable with your decision and a cooling off period is something all insurers have to offer. Some insurers offer 14 days but at Insuranceline you’ll have the time you need to make extra sure you want to continue with the policy with a 30 day cooling off period.

Is it possible that I’ll pay more in premiums than will be paid out at claim time?

With many insurance products, it’s possible that you may pay more in premiums than you are covered for. Insuranceline’s Value Promise means that after you've held the cover for 12 months, and when the time comes to claim, your beneficiary/ies will receive the Funeral Insurance Benefit – plus any applicable Bonus Cover – or the total premiums paid for Funeral Insurance, whichever is higher.

what if I cancel my cover?

Many funeral insurance policies will generally work like other insurances, which means that if no claim is made, or if you cancel your cover before a claim is made or you are able to cash in your policy, you may not get anything back. Because of this, it is important to consider the long-term affordability of any cover you take out, to make sure it is a suitable product for the long run. It's important to remember that insurance is not the same as - or a substitute for - saving money, and that depending on how long you live for, you might need to pay premiums for a long time.

Pre-paid funeral

With a pre-paid funeral you can plan and pay for your funeral in advance and lock in the cost at today’s prices. You can also choose to pay up front and leave the details of the funeral service for your family to decide on later.

There are usually two payment options – either pay in full with a lump sum or pay in instalments. If paying in instalments, an initial payment may be required up front. It’s best to shop around as funeral directors offer different packages – ask for a full description of the costs to see exactly what you are paying for.

The downside is that it may be difficult if you move interstate or want to change your funeral plans later on – check if you can transfer before you sign up.

Funeral bond

A funeral bond is another way you can help meet the costs of your funeral. Funeral bonds are like an investment that can only be withdrawn after your death. You can invest in a bond either directly through an investment company or from a funeral director.

The bond you pay is an investment towards the cost of your funeral, but doesn’t guarantee against rising funeral prices, so it may need to be topped up by your family. If you need, you can usually pay for the funeral bond in instalments, but make sure you understand all the costs – read the bond's prospectus carefully before you make a decision. The good news is that money invested in a funeral bond is not subject to the asset or income test for the Age Pension if certain conditions are met.

What's next?

Not many people like thinking about their own funeral but if you do want to sort it out in advance, there are a number of options so make sure you check them all out carefully and decide what the best one is for you.

Read more about Funeral Insurance from Insuranceline or call us on 13 77 87 and we’ll be happy to answer all of your questions.


© 2019 Insuranceline

¹ Source: www.moneysmart.gov.au/life-events-and-you/over-55s/paying-for-your-funeral. Costs are estimates only and vary depending on state, and the services and features chosen.

² The premiums may change if you make changes to your Policy or if the underlying premium rates are changed by us. However, you will never be singled out for a premium rate increase.



^Offer available to Insuranceline customers who complete an application for a Life Insurance, Income Protection or Funeral Insurance policy between 20 November 2017 and 31 March 2020 (inclusive) and are issued with a policy with a commencement date prior to 00.01AM (AEST) 1 May 2020. To be eligible policyholders must hold the policy for 2 consecutive months and pay 2 months’ premiums in full. One Gift per customer. Full terms and conditions at www.insuranceline.com.au/giftcard. Gift Card issued by Indue Ltd ABN 97 087 822 464 AFSL number 320 204. We reserve the right to change the Visa gift card issuer at any time.

~Bonus 25% more cover is calculated on the fifth anniversary from the Cover Commencement Date. Each adult life insured will have an extra 25% of the average FIC amount held during the previous five years added to their Funeral Insurance benefit. Terms and Conditions apply. Refer to the PDS for more information.

The information provided on this website is general advice only and does not take into account your individual needs, objectives or financial situation. Before you decide to buy or to continue to hold an insurance product, you must read the relevant Combined Product Disclosure Statement (PDS) and the Financial Services Guide (FSG). The PDS/FSG contains important information which will help you understand the product, including what's covered and what's not covered and to decide whether it is appropriate for you.

Promoted by Insuranceline, a trading name of TAL Direct Pty Limited (of Level 16, 363 George Street, Sydney NSW 2000) ABN 39 084 666 017 AFSL 243260. TAL Life Limited ABN 70 050 109 450 AFSL 237848 issues the life insurance benefits. St Andrew's Insurance (Australia) Pty Ltd ABN 89 075 044 656 AFSL 239649 issues the Involuntary Unemployment Cover. Pet Health Plan is issued by The Hollard Insurance Company Pty Ltd ABN 78 090 584 473, AFSL 241436.

The way in which Insuranceline & St Andrew’s collect, use, disclose and secure your personal information is set out in their respective Privacy Policies available at www.insuranceline.com.au and www.standrews.com.au.

‡Insuranceline is the longest standing provider of funeral insurance in Australia, based on: Strategic Insight, Actuaries & Researchers. Funeral Insurance means a policy with periodic premium payments that provides a lump sum to help pay for funeral and associated expenses when you die, and excludes pre-paid Funeral Plans and Funeral Bonds.