The Pros and Cons of Funeral Insurance

funeral insurance - people carrying a white coffin

Thinking about the inevitable is always difficult. You might be at a time in your life when you’re thinking about the future, particularly your family and the loved ones you’re going to leave behind. Although the idea of moving on is hard, it’s important to think about things like funeral insurance.

Funeral insurance will typically cover the cost of your funeral by providing your family a sum. What’s covered in the funeral plan will differ depending on the provider and policy you go for. So, make sure you do some research.

If you’re unsure about taking out a funeral insurance cover, read on for the pros and cons.


It saves your family money

Nowadays, funeral costs are rising. In the event of a death, funeral arrangements will usually fall on your family, but it might be too expensive to pay for without help. By paying for the funeral plan beforehand, you’re helping your family save money and it will also give you peace of mind.

A basic funeral plan will usually cover a range of costs such as:

  • Funeral director costs
  • Transport
  • A minister
  • Coffin and hearse
  • Care for the body
  • Cremation costs

It reduces inheritance tax

Funeral insurance can also reduce inheritance tax, but this is only the case if you prepay for your funeral. If you do want to take out a prepaid funeral plan, the money you pay will be free of inheritance tax or will reduce it.

There’s an option for monthly payments

Since you’ll be preparing for your funeral in advance, you have the option to split this into monthly payments. This makes it affordable and can fit within your budget. You also don’t have to worry about not having the money to pay it in full. These funeral plan payments come with different options, such as:

  • A singular full payment
  • Instalments of up to 12 months (interest-free)
  • An extended payment plan (with interest rates)

It lessens decision-making and stress

During times of grief and heightened emotions, your family and loved ones will not be in the best state of mind to make decisions and plan a funeral. By taking out a funeral insurance, you’ll lessen their stress when the time comes. This is because most plans include hiring a funeral director who will do all of the arrangements and funeral planning.

Some providers offer a repatriation service

If you plan to retire abroad, there are some providers that offer a repatriation service. This is when the body of a deceased person can be transported to a different country. So, if you happen to pass away abroad, your body can be transported back to the UK for a funeral service. This is the same vice versa. For example, if you wish to be buried or cremated abroad, this service makes it possible.

coffin in hearse


Funeral insurance might not cover everything

Many providers offer a range of different funeral plans and what you want might not be covered. To avoid giving your family financial problems, make sure you read through each plan, as well as the Terms and Conditions.

You might have limited choices with prepaid funeral plans

If you choose to take out a prepaid funeral plan, choices may be limited for your family in terms of choosing the date and time. The funeral director will likely choose the time slot for your family, which can be a less popular slot. This can result in having a limited amount of people attending.

You can end up paying a higher cost than you need to

There are some providers that don’t offer prices based on location, which means people who have a lower cost of living might have to pay more.

It can tie up funds

The money you pay towards your funeral plan cannot be used elsewhere. It may also be non-refundable and a cancellation fee might have to be paid if you want to cancel after the cooling-off period.

It’s not currently regulated by the FCA

Funeral insurance providers are currently not regulated by the Financial Conduct Authority (FCA). The FCA usually regulates the financial services industry in the UK; they protect customers and keep the financial sector stable. Since there has been more demand for funeral plans, they will be regulated by the FCA from July 2022. Although they’re not regulated, this doesn’t mean you’re not protected. Most of these funeral plans are regulated by The Funeral Planning Authority.


These are the pros and cons of funeral insurance, which hopefully helps you to decide if you want a funeral cover. For advice, help, or for any enquiries, don’t hesitate to get in touch with our funeral directors and services from our directory here.

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