Good Advice on Funeral Insurance
The decision to invest in Funeral Insurance seems, at the outset, to be a simple and wise idea. However, as time has progressed, organisations have developed various tactics in order to attract consumers and out do their competitors. For the average unsuspecting person it’s often just a matter of price or benefits and that’s where it ends. At Bethany we’ve seen many people whose choices have turned out to be bad investments and less advantageous than they should have been.
This section answers some of the questions you always wanted to know to allow you to make good decisions when it comes to safeguarding your loved ones and yourselves.
What is Funeral Insurance?
When you are covered by Funeral Insurance, you pay a regular premium into your funeral policy. On your passing, your family, or nominated person receives a lump sum, on receipt of a completed claim. Funeral Insurance usually provides a sum commensurate with your funeral expenses to alleviate the burden of funeral costs.
How does Funeral Insurance work?
Once you know how much money will be adequate for your funeral, you can apply for various quotes and talk through the options to find an affordable premium payment plan. Now here’s where it can get confusing and you should be wary of the benefits each organisations say they offer, weighing them up against what you will be paying.
Are there different types of Funeral Insurances?
Yes. Most insurance organisations carry their own types of premiums and benefits. Some guarantee your premiums will never increase (unless you make changes to the policy). Some offer accidental death coverage, and some, after 12 months, for all causes of death. Others say they’ll pay out double the insured amount if you die as a result of an accident. Some state that if you’ve held your policy and paid premiums for more than 5 years, even if you cancel your cover, your loved ones will still be able to claim a proportion of the cover amount you once held. A couple say that once you reach your premium cap, your cover continues for free.
All in all, it’s a mine field, so be aware and talk with someone who understands the pitfalls. Don’t jump into it.
Is there an alternative?
Yes. You can also choose a secure Funeral Bond
What is a Funeral Bond?
A Funeral Bond is a safe, simple and effective way to put funds aside that grow in a secure and tax effective environment to help meet the expenses of a funeral. Funeral Bonds also have significant advantages for means tested Centrelink and Department of Veteran affairs pensions.
How is it different?
You receive Investment Security, as funds can only be placed in “A” rated fixed interest securities and cash. There are no entry, contribution, or exit fees. No hidden fees.
You retain the ability of deciding how much you wish to commit. This may be a lump sum, a regular contribution from as little as $50.00 or ad hoc deposits at any time and of any amount. Once you have reached the amount you wish to set aside you may choose to leave the value of the bond at that level (plus any earnings that it may attain) or to top it up at any time you wish to do so.
By assigning the bond to a funeral home you are assured the funds will be used for their intended purpose.
The flexibility of having a bond in joint names that can be drawn on either named party when required is also a great advantage.
If I choose to apply for a Funeral Bond, how do I go about it?
It’s as easy as completing a simple application form with us providing your first contribution to the bond in the name of the funeral company issuing the bond. We can do the rest.