Funeral insurance - The great Australian rip-off

26 Oct 2012

By Shadforth Financial Group

In recent years there have been a number of television and print advertisements recommending that you consider funeral insurance. Funeral insurance is basically an insurance policy that will pay for the cost of your funeral when you die.

The advertisements are generally crafted cleverly in that they often break the premium down to a daily figure, which on the surface seems insignificant. However, when you multiply this daily or weekly cost to get a yearly figure and then multiply this by your life expectancy, this figure starts to really add up. These premiums also don't take into account that the older you get the more expensive the premiums become. When you do the sums, a funeral could be costing you up to $60,000 in premiums.

This is significantly higher than the average funeral in Australia, which costs approximately $6-$10,000 depending on your requirements. The more bells and whistles you have, the greater the cost. For example, a blackwood coffin costs more than a standard pine coffin.

Rather than taking out a funeral insurance policy, a better option is to contact a funeral home and pre-pay your funeral. With pre-paid funerals you often get a discount on the total cost, with the cost of the funeral effectively "locked in". Whilst this is not a pleasant thought, it is inevitable for us all.

And If you are brave have a look at the website and you may find out how long you have to live!

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