What is funeral insurance UK?

Funeral insurance typically refers to a life insurance policy that’s taken out specifically to help cover funeral costs.

It’s common to take out funeral insurance in the form of an over 50s plan, but some insurers offer specialised funeral insurance plans, like British Seniors.

At Reassured, we can help you compare funeral insurance plans from top UK insurers, with prices starting from just £5 a month + .

Our service is fee-free and without obligation - get in touch to see if we can help you save money.

In this guide:

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How does funeral insurance work?

Funeral insurance in the form of an over 50s life insurance policy is an affordable way to leave a cash lump sum behind to loved ones when you pass away.

Your loved ones can choose how to spend the lump sum, but it’s commonly used to help cover funeral costs.

Here’s how funeral insurance in the UK typically works:

  • Guarantees acceptance to UK applicants aged over 50, up to the age of 80 or 85 depending on the insurer
  • Application has no medical or lifestyle questions (except for whether you’re a smoker) and there’s no need for a medical exam
  • Provides whole of life cover (guarantees a full pay out after the ‘waiting period’ has passed - this is the first one or two years from the start of the policy)
  • Immediate accidental death cover during the waiting period, providing a full pay out if you pass away due to an accident during this period
  • Requires monthly premium payments until you pass away or reach a specified age (such as 90). Premium costs are determined by your age, smoking status and cover amount

Other benefits and features:

  • Add-on the free funeral benefit option to receive an extra contribution (up to £300) towards your funeral costs
  • Write your policy in trust to help protect your pay out from inheritance tax (charged at 40% if your estate is liable) and ensure a faster pay out for your loved ones
  • Policies are regulated by the Financial Conduct Authority (FCA), which means you’re protected in the unlikely event your provider can’t pay a valid claim

Please note: Funeral insurance is different to a pre-paid funeral plan as it doesn’t involve pre-arranging or pre-paying your specific funeral services in advance.

Types of funeral insurance

There are two main types of funeral insurance policies. Here we outline the key differences between both:

Over 50s life insurance

  • Type of life assurance often taken out to help cover funeral expenses
  • Offers up to £20,000 of cover depending on your age, lifestyle and the insurer
  • Can only be taken out as single policy (to cover one person)
  • Fixed monthly premiums (which must be paid until you reach a specified age, usually 90 years old)
  • Available through Reassured from £5 a month

Funeral insurance plan

  • Type of insurance to cover funeral expenses
  • Provides several cover options to choose from depending on the type of funeral you require (typically up to £10,000 depending on your age, lifestyle and the insurer)
  • Could be taken out as a joint policy (to cover two people)
  • Fixed monthly premiums (unless you opt for the increasing cover option)
  • Not available through Reassured

What does funeral insurance cover?

Funeral insurance is designed to help towards funeral costs and other expenses, depending on how much cover you take out and how your family wish to spend the money.

Unlike a pre-paid funeral plan, a funeral insurance policy isn’t attached to a nominated funeral director or any specific funeral services.

Instead, it pays out a cash lump sum that could help with:

  • Paying for your funeral (for example, helping to cover cremation or burial fees, funeral director fees, a coffin, hearse and flowers)
  • Unpaid debts and bills
  • Living costs for dependents
  • Inheritance tax (if the policy is written in trust)

While funeral insurance offers some flexibility for your loved ones, it’s not guaranteed that you can take out the level of cover you need for the full cost of your funeral.

However, having at least some protection in place can help ease some of the financial burden when the time comes.

Compare best funeral insurance UK [top 6]

In the table below we’ve provided a quick comparison of the top 6 over 50s life insurance policies in the UK.

The shortlist has been chosen based on our own research here at Reassured.

Funeral insurance (over 50s life insurance) provider defaqto logo Trustpilot logo Maximum sum assuredFree BenefitsAge premiums stopPay out for £20 a month
One Family logo Defaqto 5 stars 4.5 - 'Excellent'
(based on all services)		£20,000
  • Funeral benefit option
  • Terminal illness cover
  • Flexible premiums
90£5,217
SunLife logo Defaqto 3 stars 4.8 - 'Excellent'
(based on all services)		£18,000
  • Funeral benefit option
  • Flexible premiums
88£4,574
British Seniors logo Defaqto 3 stars 4.9 - 'Excellent'
(based on all services)		£10,000
  • Funeral Benefit Option
  • Health & Wellbeing services
  • Free Will kit
  • Increasing benefit option
95N/A
Direct Line logo Defaqto 5 stars 3.9 - 'Great'
(based on all services)		£15,000
  • Smart Health services
  • Protected insurance amount
90£4,923
Legal & General logo Defaqto 4 stars 4.0 - 'Great'
(based on all services)		£10,000
  • Funeral benefit option
  • RedArc Wellbeing Support
  • Care Concierge
  • Flexible premiums
90£4,766
Shepherd's Friendly logo Defaqto 5 stars 4.3 - 'Excellent'
(based on all services)		£15,000
  • Funeral Benefit Option
  • Flexible premiums
  • Family bereavement services
90£4,632

The information in this table is correct as of 06/11/24 and is subject to change at any time. Example payout amounts are for a 60 year old non-smoker, paying £20 a month

We’ve written this best life insurance for over 50s UK guide if you’d like to learn more about each of the policies listed in our top 6.

How much funeral insurance do you need?

When calculating how much cover you may need, you may want to consider the average cost of a basic funeral which is £4,414 in the UK[1].

The average total cost of dying is currently £9,658, which includes other funeral related costs, including flowers, a memorial and venue hire.

You could take out enough funeral insurance to help cover a basic funeral or you may wish to take out a higher level of cover to help towards the extra costs.

As mentioned, the maximum cover amount available through Reassured is £20,000 depending on your age, smoking status and budget.

Tip: You may also want to factor in rising funeral costs when deciding how much cover you need. Due to inflation, the price of a funeral in the future may be much higher than that of today. According to SunLife, average funeral costs have increased 126% since 2004. Therefore, to ensure that your family have sufficient funds when the time comes, you could take this into account when securing life insurance to help cover funeral costs.

Funeral insurance calculator

Use our handy calculator to add up the costs you’d like your funeral insurance policy to cover and find out your ideal sum assured.

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According to Uswitch, it’s estimated that 23,000 people in the UK will still be paying off their mortgage by age 75.

Although an over 50s plan can’t cover the full cost of a mortgage (as cover is capped at £20,000), it could help to contribute some funds towards keeping your family in their home.
£
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Research by Saga shows that nearly 6 million over 50s owe money on credit cards and loans, with average debt amongst this age group totalling £12,000.

Depending on your personal circumstances, an over 50s plan may not be able to cover all debts (as cover is capped at £20,000) but it could allow you to cover some debts in your name.
£
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SunLife’s Cost of Dying 2023 report found that the average cost of a basic funeral is £3,953, with the overall cost of dying totalling £9,200.

A pay out from life insurance can help to cover all or some of these costs.
£
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Age UK have found that many over 50s and 60s will be reliant on their pension to get by.

Life insurance can provide your partner with a helping hand on top of their pension.
£
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An inheritance can provide your loved ones with a cash gift to spend as they wish.

Alternatively, you could leave a portion of your pay out to a charity that’s close to your heart.
£
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If you already have a life insurance (or other financial protection) policy in place, and/or you have your own savings, factoring these into your sum assured could reduce the level of cover you require - helping you to save money.
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Your total cover estimate

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How much does funeral insurance cost?

Funeral insurance monthly premiums are determined by your:

  • Age
  • Smoking status
  • Cover amount

Over 50s funeral insurance starts from just £5 a month through Reassured.

In the table below, we’ve provided examples of how much cover you could secure for £25 a month as a non-smoker:

Age50556065707580
Sum assured£8,743£7,181£6,118£4,978£3,581£2,539£1,829

Use our award-winning comparison service to get your free, personalised quotes.

What’s the difference between funeral insurance and a pre-paid funeral plan?

There are many differences between funeral insurance and a pre-paid funeral plan.

Here we explain some of the main differences:

Funeral insurance (over 50s life insurance)Pre-paid funeral plan
You pay a monthly premium that’s based on your age, smoking status and the level of cover you chooseComes at a fixed cost which you need to pay in full upfront or in monthly instalments (instalment fees may apply)
The pay out is made to your chosen beneficiary for them to spend how they wishThe pay out goes directly to a nominated funeral director when you pass away
Pay out is not tied to any specific costs, can be used for a range of expensesCovers the cost of specific funeral services that you choose in advance
Your loved ones will need to plan your funeral when the time comesYou pre-arrange your funeral as per your wishes, relieving this burden from loved ones
Doesn’t guarantee to cover the total cost of your funeralGuarantees to cover the total cost of services included in the plan

Pre-paid funeral plans tend to cost upwards of £4,000 and can be more expensive than funeral insurance as you’ll need to pay the fixed amount within an agreed time frame.

Funeral insurance can offer a low-cost monthly premium for a potentially larger pay out (depending on your age), making it a simple and affordable option for many.

How to find the best funeral insurance for you

Shopping around and comparing quotes can help you to find the right funeral insurance at the right price for you.

At Reassured, our funeral insurance comes in the form of an over 50s plan, which guarantees acceptance to those aged 50 - 85 and could provide up to £20,000 of cover.

The money could help to cover your funeral expenses or can be used for other things depending on your family’s needs.

We offer an award-winning broker service to help you compare quotes from top UK insurers and secure your perfect policy.

Simply click through to our online form and our expert team will be on hand to provide your free quotes.

Free Funeral Insurance Comparison » Get Our Best deal

Funeral insurance UK FAQs

Can you secure more than one funeral insurance policy?

Yes, it’s possible to take out multiple funeral insurance policies to secure multiple pay outs.

However, while you can have more than one policy, maximum cover limits for each insurer will still apply.

For example, if your cover limit is £10,000 with an insurer due to your age, you wouldn’t be able to secure more than this across all policies you take out with them.

However, you could take out multiple policies from different insurers if this is within your budget.

How much is funeral insurance per week?

Funeral insurance can cost from just 20p-a-day or £1.40 a week through Reassured.

However, exactly how much you’ll pay will depend on your age and how much cover you take out.

Can you get life insurance with funeral cover?

Yes, some over 50s life insurance policies come with optional funeral cover, commonly known as a ‘funeral benefit option’.

If you choose to add the funeral benefit option to your policy, it’s completely free and gives you up to £300 extra to help towards your funeral costs.

When you pass away, your over 50s life insurance pay out will go directly to an appointed funeral director who’ll carry out your funeral as per your wishes.

This could be a good option if you’re torn between taking out a funeral plan or life insurance policy. We have written a funeral benefit option guide for more details.

What is the difference between life insurance and funeral cover?

Life insurance is a type of policy that pays out if you pass away during a specified term (such as 30 years) and is often taken out to help protect a family or mortgage.

Funeral cover could describe different types of insurance taken out to help cover funeral costs, such as an over 50s plan, a specialised funeral insurance policy or a pre-paid funeral plan.

What is burial insurance?

Burial insurance is simply another term used to describe funeral insurance. It’s not a separate product available in the UK.

If your chosen funeral type is a burial and you want to help cover the cost, you may consider a form of funeral insurance or a pre-paid funeral plan.

Sources:

[1] https://www.sunlife.co.uk/funeral-costs/

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