Funeral Insurance

Funeral Insurance

Do you need it?

How will your loved ones pay for your funeral? We find a lot of our clients have considered this issue and consider whether they need a funeral insurance policy.

It is important to understand what will happen after your death. After the bank is notified of someone passing, their sole bank accounts are frozen (not joint accounts). The bank will however still permit payment of the funeral invoice from the bank account.

This happens straight away. Ordinarily if you take a copy of the funeral account to the bank and they can make payment of the account direct from the deceased’s bank account. It is therefore not often necessary for any funeral insurance to be in place at all.

You could end up paying a lot more for funeral insurance over the years than it will be worth to your family.

The funeral insurance payment also does not form part of your estate and the beneficiary named receives that payment without obligation. This could have unintended effect on your beneficiaries and result in an unfair distribution of your estate.

We say you should carefully consider taking out a funeral insurance policy and whether it is required at all in your circumstances. Please speak to our practitioners when making Wills and Estate Planning if you have any queries.