Senior Term Life Insurance vs. Burial Insurance: Which Is Better?

Posted on November 13, 2018

Can't decide what type of life insurance you or someone you love needs?

If you're inexperienced, they all sound the same. While they seem similar on paper, each type can offer different benefits for different prices. You have to choose the right one to prepare for the future.

We tend to shy away from life insurance, with only 50% of adults visiting life insurance websites in 2018. This is due to our misconceptions about the topic.

For example, is a senior term life insurance better for your parents? Is a burial insurance superior? What's the advantage of one over the other?

These are the questions that we're here to answer for you. Both options have their advantages and disadvantages. Which one do you take?

Let's find out.

Defining Insurance Policies

Before we start the comparisons of life insurance for the elderly, let's first set up ground rules and definition.

Proper information on these two insurance types is essential. It can give us nuance on which one is better for our loved ones.

This plays into proper decision making and money management for you and your family.

We will compare both insurance types for the following:

  • Ease of access
  • Convenience to loved ones
  • Cost of premiums
  • Coverage value

We want to cover as much of our bases as possible. This lets you make a fair comparison of both and get the one that fits your needs.

What Is Burial Insurance?

The official definition of burial insurance defines it as "a type of whole life insurance policy that provides death benefits to the bereaved." The name is self-explanatory.

The idea is that it provides financial aid to your loved ones once you pass away. The usual coverage is enough to pay for funeral and burial costs, which is around $5,000 to $25,000.

The age of coverage for burial insurance varies. The typical coverage, however, is around 50 to 80 years old.

Why do people get this? Because if your parents or elderly come to pass, money should be the last concern.

What Is Senior Life Insurance?

Senior life insurance provides financial benefits to the bereaved. This amount of money is hefty. It may not, however, straight up take care of funeral and burial arrangements.

This leaves more money for the loved ones left behind, at the expense of extra effort on the side of the bereaved. Also, there is expiry to it.

The typical length of such insurance depends on the sub-type. Term insurance goes at 10, 15, 20 and 30-year term limits. The norm is that the older you are, the higher the premium and shorter the term.

Senior whole life insurance covers the entire period the person is alive. This is valid as long as they can pay the premium.

Insurance Ease of Access

Burial insurance proponents tout its ease of access. People choose this policy over others with a higher value for the sake of convenience.

Getting life insurance on parents? These burial policies may have simpler requirements.

At the very least, you'll be answering minor health history questions. You may or may not take a medical exam, with the latter being common.

These simplified requirements are a significant selling point for burial policies. You can even secure one online!

Senior citizen life insurance has the standard requirements that insurance policies have. These include long health questionnaires and a medical exam.

Insurers do this for two reasons. One, it's to make sure that the insurer can pick a proper pool for your type of risk. Two, it's to calculate the appropriate premium for your policy.

Convenience to Loved Ones

If there's any big benefit with burial insurance policies, it's convenience. The burial policy's design is to make sure that everything gets coverage, from funeral to burial.

The sum that this life insurance for the elderly covers is modest. Its coverage fits the right amount needed to pay for everything in the funeral home.

On the other hand, senior whole life insurance's downside is that its structure is a bit inconvenient. Many times, its value comes with its financial benefits and nothing more.

This means that, in times of grief, the bereaved would need to take care of every detail. This may be okay or not, depending on the health and mental situation of the bereaved.

Cost of Premiums

Another advantage touted by burial insurance proponents is the low cost of premiums. It's true that taking care of premiums is essential to avoid financial trouble while you're still alive. Many burial insurance policies charge weekly or monthly, depending on the provider.

The issue, however, is that a senior citizen life insurance plan is as affordable as low-mid to mid-tier burial insurance plans.

What do you need to do to get your premiums lower? Have patience looking.

Unless you're scraping the bottom of the barrel for next week's meal, senior whole life insurance should be better.

Coverage Value

This is what sets apart senior whole life insurance from burial insurance: the coverage value. It's night and day.

Burial insurance policies aim to cover funeral and burial expense. It's on the name itself. In a Canadian funeral, this nets around $8,000 on the low end and $15,000 on the high end.

If you look around the internet, the value in reports to range from $5,000 to $25,000. That's decent.

How much is the coverage of life insurance for parents? There are no concrete numbers.

If you give a cursory Google search, the value goes between $20,000 on the lowest end, up to $2 million. This depends on how good you are at looking for a good life insurance policy.

That means the lowest senior citizen life insurance you can get is equal in value as higher-end burial insurance policies.

Let that sink in.

Senior Term Life Insurance vs Burial Insurance

Taking out life insurance for parents is no joke. It's money you're pushing for future convenience, and not a lot of people care.

Even then, senior term life insurance is an essential step to make amends with the future. You want to be ready, whether it's for your parents or yourself.

Burial insurance is convenient and quick. Senior citizen life insurance provides more coverage at near identical cost.

Which one is better? That's up to your needs.

Are you still on the fence? Or have you made your decision?

Whichever it is, get the right advice with us at Insurdinary. We provide expert advice through our insurance agents, so give us a call.

Get a free quote for you or your loved ones. It helps to be ready for the unexpected. In such insurmountable or extraordinary parts of your life, Insurdinary can help.

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