Knowing how funeral cover premiums are calculated could help you find a policy that suits your budget.
For the most part, funeral policies all work much the same. You’ll pay a monthly premium throughout your life, and when you pass away, a lump sum is paid to your beneficiary to help cover funeral costs like burial or cremation.
Still, not all funeral policy providers will charge you the same premium. This is why it’s important to know how they’re calculated, consider the extra benefits and get quotes from several providers. This way, you can make an informed decision and choose one that will offer you the right amount of coverage at an affordable premium.
The two main things that affect your premium are the number of people you’re covering and the sum assured for each member.
The more people covered under one policy, the higher the premium. This might seem counterintuitive, but it’s generally less expensive to cover multiple family members on a single policy than to take out separate policies for each person.
The sum assured is the amount of money that will be paid out by the insurer in the event of a policyholder’s passing. South African regulations limit the total sum assured per adult member to R100 000, however most insurers only allow cover of up to R50 000 per member. This helps to keep premiums affordable but keep in mind that the higher the sum assured you choose for each member, the higher your premium will be.
A little bit about funeral cover benefits
Not all funeral cover companies are created equally. Some will also offer you a variety of additional benefits that range from a grocery benefit to a memorial headstone or cash-back benefit.
These benefits can end up adding to the cost of your premium. However, some insurers offer basic benefits packages that are included in the policy. Sometimes, you can save money by choosing a policy that doesn’t offer any extra benefits, but consider the idea that you’ll save in the long run if they’re offering a benefit you’ll make good use of. As an example, some funeral policies will include a repatriation benefit. If you or your loved one were a policyholder and had to pass away far from home, a benefit like this would save you a lot of money as this cost wouldn’t have to be paid for via your funeral cover amount.
Finding the right funeral cover for you
There are lots of things to consider when choosing a funeral cover policy but the most important is to choose one policy that provides enough cover to meet your family's needs. Our top tips to make the right choice are to get quotes from several different insurers and carefully compare their benefits.
Another way to get funeral cover? Take out a life insurance policy with MiWayLife! It includes a funeral cover benefit that pays out 10% of the total available life cover amount – capped at a maximum of R50 000 – that pays out within just 48 hours of submitting the necessary claim information. Why not get a quick quote from MiWayLife today?
Did You Know:
You can now take out life cover with us online in a few simple steps. No calls and no agents! Make sure to take care of those you love today by buying MiWayLife cover online.
