Understanding Life Insurance & Final Expenses
If your loved ones depend on your income for their daily needs, life insurance offers you the peace of mind that they’ll have the financial support they need when you’re no longer here for them. One substantial way life insurance makes a difference is with final expenses.
Final expenses are the costs your loved ones will have to pay for burial fees, memorial services, cemetery charges, and other items associated with your passing. According to Eric Vandermeersch, the founder and CEO of Basic Funerals, the average cost for after-death arrangements in Canada is $8,500.
What specifically are you paying for? Here’s a quick breakdown:
Death certificate (Up to $22 depending on city/province) and registration (Approx. $55)
This is the cost to legally register your death and obtain a death certificate, which is required for your loved ones to claim insurance, settle your estate, and receive any benefits they may be entitled to as beneficiaries.
Body transfer services ($100 or more)
Covers the cost to transport your body from the place of your death to the funeral home or crematorium. This can be costly if you die outside of the province where you will be buried or cremated.
Casket ($700 to $3,000 and beyond) or urn ($20 to $200)
Casket and urn prices vary greatly based on your personal preference. You can opt for a simple casket for several hundred dollars or choose an ornate one that costs thousands. Likewise, a simple urn can be purchased for as low as $20 while more decorative keepsake urns can cost hundreds of dollars.
Body preparation ($150 to $550)
This cost covers all the processes necessary to get your body ready for visitation and either burial or cremation such as bathing, embalming, dressing, and applying cosmetics if necessary or desired.
Funeral and memorial services ($2,000 and higher)
Depending on the location and number of family members and guests to be accommodated, the actual cost of formal ceremonies can be the greatest after-death expense for your family, particularly if licensed memorial services staff are required to attend.
If these expenses would be a serious hit to your bank account, then term life or whole life insurance is worth the investment. When you purchase your policy, you will name a beneficiary that understands your desire to use a portion of the death benefit to cover these final expenses. You may even be able to designate your preferred funeral home as the beneficiary for final expenses.
Talk to your insurance broker to discuss this option as well as other steps you can take to protect your family’s financial future in the event you are no longer here to support them.
Original content provided by Pathwayport.com