‘Burial cover’ and funeral insurance are the terms most commonly used in South Africa and Australia while Burial Insurance seems to be a term most commonly used by North Americans. They all mean much the same thing.
If you’re seeking information on funeral or burial cover, what you need to consider is whether your goal is to protect your family after you have passed away or if you want only to plan and fund your own funeral. And, what about others in your household? It may come down to affordability.
In South Africa, some burial societies have been found to provide more benefits than formal funeral plans. The informal burial societies will cover the whole household consisting of adults and children, parents and in-laws. Some households have mixed cover -being members of a burial society (or two) and also having formal cover.
You may have noticed that not all funerals are created equal. Depending upon the economic status of the family, the level of pre-planning that existed, the suddenness of the death and the circumstances surrounding it, burials can be thrown together quite hastily and inexpensively or can also be done in fine style.
On the high end, those families that have had the opportunity to plan properly may entertain friends and extended family for days on end, as their cultural rituals unfold. Feasts are not uncommon for those guests which must also be accommodated, not just entertained.
The deceased is sent off in the finest wardrobe with no expense held back. Some cultures and religions call it a homecoming and the deceased arrive in fine style.
It depends greatly upon how much foresight the family had in planning for the funding of the event. Some families are caught by surprise and need to take out loans or pass the hat at church. Loans obviously can affect the family finances for a long time into the future. Passing the hat is often thought rather demeaning by the family.
The preferred method is to plan ahead, of course. There are formal funding means available in the form of ‘for-profit’ insurance companies and informal ‘not-for-profit’ friendly societies that can issue burial cover for the entire household, sometimes offering many benefits.
There are plans that are affordable for all income levels, with varying levels of complexity. Some burial bonds carry with them certain tax advantages.
The thought behind the entire process is to avoid, where possible, the burden on the family who has to bear the expense when pre-planning was neglected. When credit and loans come into play, the financial burden on a family can be significant, sometimes affecting the standard of living, perhaps affecting the education of the children, long after the event.
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