Is Funeral and Life Cover the Same Thing?

Title of Funeral vs Life Cover article
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The simple answer is no. You may think that funeral cover and life cover are the same, but this would be like comparing primary school and university. There are some similarities but there are way more differences.

Funeral Cover and Life Cover are certainly not the same, this is a myth. Another myth that exists is the belief that funeral cover is much cheaper than life cover. The first myth we will address in this article, the second myth we need to chat about your situation. Based on your reasons and needs for the cover we help you compare products.

Why Should I have Funeral Cover?

Funeral cover is a way of managing the costs associated with burial, coffins, cremation costs, transport and catering. These are just a few of the costs linked to a family member passing away. Depending on your family structure you may have several dependents and you may also be responsible for the costs associated with their funeral.

Why Should I have Life Cover?

Life cover ensures your dependents are taken care of. It helps with managing and planning for large commitments and expenses like your child’s education, your bond or providing an income for your partner. Funeral cover is limited in several ways and only helps with funeral expenses. Life cover has very few limits and handles everything else.

Funeral Cover does fulfill a need but it has some limitations, it can be expensive and it is often disguised as life cover.  Although it helps with some of the expenses it often leaves a gaping financial hole for your family. Both products fulfill specific a need and although life cover is a broader product assisting with education, income, and settling of debts there are unique situations where funeral cover can do the job. It is very important that you speak to someone that is not from a product provider to discuss your options.

When planning for death there are a few expenses we cannot escape or avoid paying. Two of these unavoidable expenses are the costs around the funeral and the costs of winding up your estate.

Cost of Dying
Funeral costs

According to Hippo in an article from 2017, the total costs of a modest funeral could be more than R65 000. You can get it done more cheaply but for many South Africans this is a big event with many traditions and many families find themselves out-of-pocket.

Winding up of a small estate

After the funeral, there are several more expenses often not mentioned. According to Business Tech, dying with an estate value of R1 million will cost approximately R59 674 in fees to wind up.

Most Funeral Cover products have limits of R75 000 for the primary insured with some offering up to R100 000. With Life Cover there is almost no limit to the amount you can cover and you can quote for the exact amount you need.

Remember, life insurance is designed to be the cornerstone of sound financial planning. It takes debt, living expenses, caring for your parents and education into account. Funeral insurance is covering just one of those aspects.

Contact us to go through your options. You should only speak with an independent planner who can discuss all the options you have.

Life Cover

Funeral Cover

Aim

Life insurance aims to create long-term financial support for your family. 

Cover the costs associated with the Funeral

Your Premium Depends on

factors like age, gender, income, qualifications, smoking status

Factors like age, income

Payout Time Frame

Once documents are submitted 24-48 hours on the funeral benefit.

Once documents are submitted 24-48 hours

Requirements

  • Application
  • Medical underwriting
  • Basic underwriting
  • Generally no medicals

Benefit Limits

No limits. You choose how much cover you need

R70 000 – R100 000 depending on the product

How many people can be covered

The life insured and spouse can have life cover benefits and the life insured can nominate their partner and children for funeral

Can add immediate and extended family.

Our number one job as a financial planner is to listen to you, understand your goals and provide the best objective advice. Get the right cover and the right advice.

Contact us for assistance and answers.

Live Trust Grow Matter

The information provided is not intended to address the specific circumstances of an individual and is for information purposes. Should you require financial advice please contact us info@growmatter.co.za

Author: Mathibane Mpahlwa

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